Buying Real Estate When It's Not For Sale

Buying real estate can start with a look in the newspaper, a visit to a broker, or a search online. These are all good ways to find your next investment property. You're looking at the same properties as every other investor, of course, so it's not always easy to beat the competition to a great buy.

A better way to find good real estate investments is to look for properties that aren't yet for sale, and make an offer. I bought my first home this way. I put an ad in the paper stating what I was looking for, and soon had a call from an old couple that had been thinking about selling. I bought their place at a good price, and they saved a broker's commission.

Buying investment real estate that isn't for sale starts with a three step search process. First decide what you are looking for. Single family rentals or apartment buildings? Then start looking for properties that fit your criteria. Then contact the owners.

Buying Real Estate From Non-Sellers

Don't limit yourself to "fixer-uppers" or other "problem" properties that seem more likely to have owners willing to sell. Many owners of investment real estate have thought of selling, so you can start with almost any building you like. You never know beforehand if or why a landlord is ready to call it quits. You find out by asking.

Tact is necessary here. Call the owner and tell him you're an investor, not a broker. Let him know that you like what you see. Tell him you can have an offer ready in a week if he's interested. NEVER EVER MENTION THE PRICE VERBALLY AND IF YOU WANT TO RAISE YOUR CHANCES OF GETTING THE PROPERTY, "DO NOT" GO ANY FURTHER IN THE CONVERSATION AT THIS POINT....The seller will do all he can to find out what you had in mind, and tell him first, you wanted to find out if the seller was even interested in selling....and every time there is a question about price or about what your offer will look like, say, "ya know what, since you sound interested, I'll take a day or two, have an offer in writing for you, and let's go from there...."

At this point, this is where you call a BUYERS AGENT (If you are in WA State, call Beryl Gosney at 425-344-2222, a leading buyers agent on Internet and serves Western Washington).....

DO NOT, UNDER ANY CIRCUMSTANCES start negotitating with the seller yourself...I don't care how many homes you've owned, or if you are a seasoned sales person or not, selling homes is unique. Home selling experience specifically, truely makes a difference in the outcome of your deal ---- especially when the buyers agent representing you, is paid by the seller! You see, it most all cases, the buyers agent commision has already been pre-determined in the sellers listing contract, that a commission would be going to the seller agents broker, from the sellers proceeds.

If the seller is not interested, thank him politely when you made the initial call and hang up, an d share the contact info with your buyers agent and ask them to send the homeowner a card or a letter on your behalf. Many investors have bought from owners that changed their minds.

Naturally if you are buying a rental unit, we'll need to see the books. Specifically, you'll need to see the rent roll, listing the units and what they rent for, plus current occupancy, and operating expenses for the last year.

The buyers agent needs to have a confidentiality agreement ready for you to sign and attach with your offer. Your agent should let the owner know that you'll sign it and the agent will deliver it to him before you see the books. He may not want to let the tenants know he's thinking of selling, so inspecting the units may have to wait until you make an offer. Just make an acceptable inspection a contingency in the offer.

Why buy investment properties this way? No competition means you may get a better price. Also, instead of waiting for that perfect property to be listed for sale, you just find it now. Why wait until it's for sale before buying real estate?