If you’re a real estate agent with a phone and good real estate investment software then you have the tools you need to convert a property owner into a rental property owner. It will require some long hours on the phone along with true grit, but it is possible if you want it bad enough.
Here’s how you do it.
- Research the money market – call several lenders in your area and ask them what rates they’re offering to refinance a home along with rates to purchase income property. You will probably discover that rates are extremely favorable.
- Research the income property market – make note of what properties are currently available for sale. Use your real estate investment software to prepare cash flow analysis presentations on each one and highlight those of particular interest.
- Call your homeowner customers one-by-one – let them know what you’ve uncovered and suggest that they consider pulling some money out of their home to make an investment in rental income property. Be gracious to take no for an answer, but at the same time be prepared to make a lasting impression when the iron is hot. Offer to send them an APOD and Proforma you created on the income properties currently for sale.
Is it too simplistic? Not really…remember what you learned about cold calling—that it takes an average of one hundred calls to close one transaction. And in this case, that one transaction, being able to sell one income property, can result in a hefty commission. So don’t get discouraged, keep your eye on the prize because it’s worth it.
You might even be surprised by the opportunities you’re presented by a simple phone call. A colleague of mine, for example, ended up listing several hundred units as the result of a cold call to a FSBO concerning a small plot of vacant land. I have had similar experiences. When you make that call, you just don’t know what the needs of that person on the other side of the phone is.
Okay, but we mustn’t gloss over the importance of being able to make clear and concise real estate analysis presentations. You do need good real estate investment software to make your presentations; otherwise, you’ll appear to the customer simply as a hungry agent looking for a deal. Bear in mind that customers respond to knowledgeable information.
The bottom line is that you must convey information. In this economy everyone is looking for a floatation device; no one wants to loose his or her money. When you’re adequately prepared to show a reasonable thinker how to take advantage of this market, rather than to be victimized by it, you will create a win-win scenario that both your customer and you will enjoy.