122: How I have Been Getting Great Deals on Investment Properties

So far, I have bought 25 properties in 2017: 23 flips and 2 rentals. This is buy far the most properties I have ever purchased in one year, and I still have a few months to go. For me to be able to buy that many houses and commercial properties, I have had to expand the way I find deals. I have bought properties from the MLS, wholesalers, Zillow, direct marketing, networking, and auctions—all this year. On this episode of the InvestFourMore Podcast, I talk about how I get deals from all of these sources. I also discuss how the ways I find deals have evolved over the years.

How did I start buying deals early in my career?

I started working with my dad right after college in 2001. He occasionally flipped houses and had always found them at the local Public Trustee Auction. I helped him expand the flipping business by purchasing more properties. One way we did that was by expanding the way we found deals. We started to buy properties from the MLS, and it is a good thing we did because deals at the foreclosure auction dried up. More investors started to buy at the auction, which pushed prices too high for us to get a good deal.

After I bought the business from my father, I expanded how I found deals even more. I found wholesalers, started direct marketing, and looked for other off-market properties.

Can you still get a good deal in today’s real estate market?

Obviously, I can still get a good deal in today’s real estate market since I have bought 25 houses this year, but many people claim finding deals in their market is impossible. Fortunately, the my Colorado market is one of the hottest in the country. In my town  of 100,000 people (Greeley), we have routinely had less than 100 properties for sale in the entire town. That is an incredibly low amount and makes finding deals tough. However, I am still buying flips and rentals in the area, and I have not sacrificed my profit margins. I have bought 8 of my active 19 fix-and-flip properties from the MLS. You can get a great deal in any market if you know how to find them. In this podcast, I talk about how I find deals and how I negotiate with sellers to get those deals.

To see all my active house flips, check out this page.

How have I learned new techniques to buy more properties?

There are ups and downs in the real estate business. When I was relying on just the auctions the MLS to find deals, it was hard to know how many deals I would get each month. Some months, I would buy five houses, and other months, I would buy none. I knew if I wanted to have a consistent business, I needed to expand how I find deals. Here is what I have done in the last two years to get more deals:

  • Buy from wholesalers: Finding good wholesalers is tough, but they can be an awesome source of deals when you find the right one. Four of my 19 active flips were bought from wholesalers, and I was buying many more earlier in the year.
  • Use direct marketing: I used direct marketing a couple of years ago with some success. I did not like the postcards I sent out or the angry calls I got. This year, I was approached by a wholesaler and flipper who helped other investors use direct marketing. He created envelopes, letters, a list, and even takes calls for me. The best part is the notes are sincere, and I no longer receive angry calls!
  • Networking: I get a lot of deals from other real estate agents, professionals, and even friends of people I have bought houses from. I always go above and beyond to do business the right way. Other people see that and are comfortable referring sellers to me.
  • Other sources: I have also bought for-sale-by-owner properties from Zillow and Facebook this year. There are deals everywhere if you know how to look for them.