3 Things To Do When You Can’t Find Good Flip Deals Easily
The real estate market in many areas of the United States transitioned into a seller’s market (though not equally across geographies). This has resulted in getting harder to find good deals for flipping in many markets. What can you do? Here are three things to do when you can’t find good deals to flip.
1. Do more and different marketing Motivated sellers are born every day. That means that new opportunities for good real estate deals are created every day. The investors who get those deals are the ones actively prospecting for those deals. If your current marketing methods are not as effective as they used to be in uncovering the new deals that are created every day, maybe it’s time for you to expand the type of prospecting and message you are using to find the new deals that are popping up constantly.
Have you been relying on finding deals only on MLS or have you been sending direct mail marketing campaigns?
If you’re doing direct marketing, have you analyzed your message and format recently for relevance as the market conditions have changed?
Are you adequately targeting specific market segments of motivated buyers or are you doing shotgun marketing using bandit signs with a generic message?
Have you contacted divorce attorneys, bankruptcy attorneys or healthcare workers who might know of people who need to sell their houses?
Have you been asking your barber or hairdresser about who might need to sell their house?
Make a list of three creative networking activities you can do that will let people know you are able and willing to buy houses specific to your area.
2. Become a part-time investor When the market is tight for finding flipping deals, that is when you realize the great value of having multiple independent streams of income.
If all your streams of income are related to real estate, they may not be as independent as you think. If you’re a flipper, there is one area of real estate investing that provides a continuous source of income and that is described next. 3. Build your rental portfolio When you have even a small portfolio of rentals, you have a stream of passive income. If you are good at finding deals for flipping, you are good at finding deals for rentals. You can do this.
As we cite in other blog posts, 89% of landlords of single family home rentals, own 10 or less of such homes. In most cases, these are the same homes you have been targeting for flipping.
When you come across a deal that isn’t quite good enough to flip, have you analyzed the deal as a rental? Let’s say you find a property that can only generate $10,000 as a flip which means it is not worthwhile to buy-fix-sell. You should analyze the positive cash flow from that property after financing, taxes, insurance, vacancy, repairs and administration. If that single family home will generate $300-$700 per month of positive cash flow, then it might be a good candidate to start building a small portfolio of even 10 or less rentals that can generate several thousand dollars of passive income.
I never want to have more than 10 tenants (for happiness reasons) which is why I limit the size of my rental portfolio. I must admit that having $5,000-$6,000 per month of passive income doesn’t meet all my family’s needs, but it sure goes a long way when I have to take a few months off for various reasons such as to handle family matters (like when my parents needed help for an extended medical situation). When you generate a few thousand dollars per month of passive income through rentals, it takes some or much of the pressure off meeting routine financial needs as well as special financial needs, especially when the market changes and it is harder to find deals for flipping.
If you want to learn how to be a Smarter Investor for many ways to make money and achieve happiness through real estate investing, now purchase the Smarter Investing home study course that includes 4 hours of training on strategic decisions making for simultaneous happiness and prosperity for every day of the rest of your life, 10 hours of training describing the practical details of four primary real estate investment strategies (including advantages and disadvantages of each), 4 hours on financing (including self-directed IRA’s and Roth) and 4 hours on optimizing personal performance for all investors (including family members).
The detailed contents of the Smarter Investing home study course are as follows (duration hr:min in parentheses):
Achieve Financial Freedom Through Successful Part Time Real Estate Investing (1:36)
How to Measure and Set Achievable Goals for Happiness and Prosperity (1:27)
Should I Flip-Rent-Wholesale-or-Lease-Option (1:04)
Top 10 Essentials for Successful Flipping (1:33)
How to Choose Renovations for Profitable Flips and Rentals (1:08)
Fund a Rental With a Flip - Case History Analysis (1:17)
How to Choose Houses for Rentals (1:31)
How to Establish Acceptable Standards of Behavior with Tenants, Tenant-Buyers, Other People's Children and Other Humanoid Life Forms (1:30)
Wholesaling...From the Buyer's Perspective (0:45)
Overcome Barriers to Buying Your First or Next Investment Property (0:35)
Leverage of OPM - The Good, the Bad and the Ugly in Real Estate Investing (1:25)
Private Lending Is Great...Until It Isn't - 19 Things That Can Wrong When Private Lending and How to Avoid Them (1:23)
Self-Directed IRA's versus Self-Directed 401k's - Advantages, Disadvantages & Examples (1:09)
Self-Image Tune-Up to Improve Personal Performance (1:35)
Decision Making Happiness and Lifestyle Aspects of Real Estate Investing (1:11)
Understand and Improve ROI - Part 1 - Flips (0:41)
Understand and Improve ROI - Part 2 - Rentals (0:49)
Understand and Improve ROI - Part 3 - Decide Between Flip or Rental (0:34)
Should a Real Estate Investor Get a Real Estate License (0:40)
Don't waste another decade of your life seeking simultaneous happiness and prosperity. Now invest in yourself and purchase the Smarter Investing home study course