NEW INVESTOR TRYING TO BUILD A BUYER'S LIST. SUGGESTIONS?

[SecondGREI]

I am a new investor that is interested in probate properties.  I am trying to build a buyer's list.  There are two towns within 90 minutes of here that have a population of about 60,000+ each.  There are no REI clubs within a reasonable distance of here.  What do you all suggest I do to find investors to partner with ( I plan on assigning contracts )?

[kdhastedt]

I'd run a 'blind ad' in the local free papers and on Craig's list that you're selling a property that is similar to htose that you would be buying and see what interest you stir...

Keith

[WTSinvestor]

The above advice is what many people do but its a bait and switch tactic that is unethical and in my opinion unnecessary. 

Why not post an ad regarding the service you are going to provide and your experience and maybe an example of a deal you have done already and start off with investors in your area with a completely transparent and honest approach.

Unfortunately the bait and switch technique is quite effective and many people will be fooled by it.  I think you will miss out on truly smart investors because they will smell you out on first contact.

my 2 cents

[kdhastedt]

Not true:

http://en.wikipedia.org/wiki/Bait-and-switch

http://www.marketing-register.com/glossary/b/Blind_Ads/index.shtml

Not the same at all and certainly not unethical in any sense of the word.

What is the caller out except a few minutes of their time?  You then ask if they are interested in future properties that you may have and collect the information as to what they are looking for.

Bait and switch is intentionally deceptive in an attmpt to get you to buy a higher priced piece of merchandise on the spot...


Keith

[WTSinvestor]

From wiki "First, customers are "baited" by advertising for a product or service at a low price; second, the customers discover that the advertised good is not available and are "switched" to a costlier product."

Instead of switching the 'customer' (responder to your fake ad) to a costlier product you switch them from the product you advertised to your services for which you charge a fee.  Will the small time investor go to jail for this? certainly not, but nontheless draw your own conclusions.

From your second link: "Also, products marketed by blind ads tend to be suspect in terms of quality or effectiveness. Many are outright scams and rip-offs. "

again a technique that is extremely common but nontheless you can do better especially if your trying to establish a working relationship with a investor.

my 2cents

[rmcleaird]

Yeah I'm going to agree that you're not pulling a bait and switch. You're building a buyers list. Anyone who's been around investing knows they're bound to call one of these guys from time to time and it's part of the deal. You sign up on their buyers list and then you get their next property when they find one. If you get turned off everytime you call someone and they 'already sold that house' (standard response) then you're going to be upset quite a bit in this business.

Anyway, to answer the original question: not only can you run the blind ad in the paper - but you can create reverse bandit signs as well. there is a local wholesale company who does this ALL the time. Sample sign:

Investor Special
Cost: $45k Value: $130k
Phone #

Simple and to the point and your phone will ring. Good luck

[kdhastedt]

From wiki "First, customers are "baited" by advertising for a product or service at a low price; second, the customers discover that the advertised good is not available and are "switched" to a costlier product."

Instead of switching the 'customer' (responder to your fake ad) to a costlier product you switch them from the product you advertised to your services for which you charge a fee.  Will the small time investor go to jail for this? certainly not, but nontheless draw your own conclusions.

From your second link: "Also, products marketed by blind ads tend to be suspect in terms of quality or effectiveness. Many are outright scams and rip-offs. "

again a technique that is extremely common but nontheless you can do better especially if your trying to establish a working relationship with a investor.

my 2cents

There is no 'switch involved'...also, what fee would I be charging?

I would not charge anyone to add them to a list of potential buyers for a property that I would have in the future.

Keith

[WTSinvestor]

We are the most dangerous beings on the planet because of our ability to rationalize favorably.

If you believe that posting an ad for sale of a property you do not own or have any right to sell or in some cases a property that does not even exist is not baiting then lets agree to disagree.

This reminds me of the time I met Craig of Craigslist.  I was working as a rental agent in NYC and I bumped into him at a luxury rental building in the financial district.  We got to talking mainly being new to the industry I was upset that craigslist that I loved would charge me such a high fee for placing my rental ads on the site.  He countered that one of his visits was due to the fact that his staff was getting so many complaints regarding fake/untrue, bait and switch type RE rental ads on craigslist in NYC.  I was completely honest with him and told him that most agents take a listing and then to be competitive on the site lower the numbers to the point where it screams great deal to generate the phone calls.  Once the phone rings the agent quickly moves the customers focus by telling him "that specific apartment is gone" but if you tell me what you are looking for I will contact you with similar properties I have.  Also agents used to have a file of hundreds of pictures and just build any random apartment ad they wanted.  Totally fictional but with the right price it generated phone calls.

I use craigslist.  I am an investor, admittedly pretty new.  But I wish a wholesaler or a bird dog would just post an ad illustrating their services.  I would surely call.

[nsu1997]

Is it kinda sneaky, sure...so are bandit signs...so are yellow letters...but I could care less...landing a cash buyer to me is much more important than whatever moral quandry I'd have for posting a blind ad. Besides, only I would know there was never a house for sale, and ultimately if they buy a deal from me in the future and make themselves $50k I'm sure they'll be glad they called that blind ad. It's a win-win...no one loses. Even if we never do business at all.

But I also agree that the whole scheme is totally unnecessary. If a blind ad presents a moral dilemma for anyone, may I suggest calling other wholesalers and ask them would they give you the opportunity to help them market their deals. You could simply call We Buy Houses bandit signs. Simply ask them would they give you a cut  if you bring them a buyer, or you can also mark up their price a lil bit. Tell them if they find a buyer before you then you're out so they have nothing at risk...you're not "tying up" their deal, only helping them sell it. Get a Flex Option Agreement (just google it) signed by the wholesaler.

Now simply market THAT house. Not only will you be building your buyers list, you'll also be sending out a REAL deal AND possibly make money all at the same time.

For any newbie wholesaler out there who's never done a deal, I can't think of an easier way to get your first one other than what I just described.

[SecondGREI]

Is it kinda sneaky, sure...so are bandit signs...so are yellow letters...but I could care less...landing a cash buyer to me is much more important than whatever moral quandry I'd have for posting a blind ad. Besides, only I would know there was never a house for sale, and ultimately if they buy a deal from me in the future and make themselves $50k I'm sure they'll be glad they called that blind ad. It's a win-win...no one loses. Even if we never do business at all.

But I also agree that the whole scheme is totally unnecessary. If a blind ad presents a moral dilemma for anyone, may I suggest calling other wholesalers and ask them would they give you the opportunity to help them market their deals. You could simply call We Buy Houses bandit signs. Simply ask them would they give you a cut  if you bring them a buyer, or you can also mark up their price a lil bit. Tell them if they find a buyer before you then you're out so they have nothing at risk...you're not "tying up" their deal, only helping them sell it. Get a Flex Option Agreement (just google it) signed by the wholesaler.

Now simply market THAT house. Not only will you be building your buyers list, you'll also be sending out a REAL deal AND possibly make money all at the same time.

For any newbie wholesaler out there who's never done a deal, I can't think of an easier way to get your first one other than what I just described.

Thank you nsu1997!  I have never heard of the "Flex Option" until now.  Do any of you all use these?  How do you make sure that if you do find a buyer, you don't end up disappointing him/her by having to tell him/her that the seller found someone else at the last minute?

[ethomson]

I personally don't have a problem with blind ads but i feel like 95% of people responding to your ads will not be investors.  For that reason you may want to do like the one person said and advertise that you are looking for investors to add to your networking list.  Put it in your signature here with your contact info.

[Mr Investor]

Is it kinda sneaky, sure...so are bandit signs...so are yellow letters...but I could care less...landing a cash buyer to me is much more important than whatever moral quandry I'd have for posting a blind ad. Besides, only I would know there was never a house for sale, and ultimately if they buy a deal from me in the future and make themselves $50k I'm sure they'll be glad they called that blind ad. It's a win-win...no one loses. Even if we never do business at all.

But I also agree that the whole scheme is totally unnecessary. If a blind ad presents a moral dilemma for anyone, may I suggest calling other wholesalers and ask them would they give you the opportunity to help them market their deals. You could simply call We Buy Houses bandit signs. Simply ask them would they give you a cut  if you bring them a buyer, or you can also mark up their price a lil bit. Tell them if they find a buyer before you then you're out so they have nothing at risk...you're not "tying up" their deal, only helping them sell it. Get a Flex Option Agreement (just google it) signed by the wholesaler.

Now simply market THAT house. Not only will you be building your buyers list, you'll also be sending out a REAL deal AND possibly make money all at the same time.

For any newbie wholesaler out there who's never done a deal, I can't think of an easier way to get your first one other than what I just described.

How are yellow letters sneaky?

[nsu1997]

Is it kinda sneaky, sure...so are bandit signs...so are yellow letters...but I could care less...landing a cash buyer to me is much more important than whatever moral quandry I'd have for posting a blind ad. Besides, only I would know there was never a house for sale, and ultimately if they buy a deal from me in the future and make themselves $50k I'm sure they'll be glad they called that blind ad. It's a win-win...no one loses. Even if we never do business at all.

But I also agree that the whole scheme is totally unnecessary. If a blind ad presents a moral dilemma for anyone, may I suggest calling other wholesalers and ask them would they give you the opportunity to help them market their deals. You could simply call We Buy Houses bandit signs. Simply ask them would they give you a cut  if you bring them a buyer, or you can also mark up their price a lil bit. Tell them if they find a buyer before you then you're out so they have nothing at risk...you're not "tying up" their deal, only helping them sell it. Get a Flex Option Agreement (just google it) signed by the wholesaler.

Now simply market THAT house. Not only will you be building your buyers list, you'll also be sending out a REAL deal AND possibly make money all at the same time.

For any newbie wholesaler out there who's never done a deal, I can't think of an easier way to get your first one other than what I just described.

How are yellow letters sneaky?

People think it's from someone they know or think money is possibly in there.

[Aces]

Believe me or not, but the best way to be successful is to be honest with your business

[THATREIGUY]

you can also leverage other wholesalers buyers til you have your own..  network with wholesalers find out what there buyers are looking for and find properties for there buyers present them to the wholesaler and split the profit and also make sure you market that property yourself to pick up any extra buyers along the way..cause hey a good deal is a good deal depending on the area..