The current market is full of amazing deals, and the US market is full of even more interesting buying strategies that the Canadian market. Getting an offer that’s anything more complicated than 10% below asking accepted is complicated. Now I’m just going to talk the Canadian real estate market for a second, because that’s the only place I buy, and I don’t mess with short sales, forclosures or pre-forclosures.
Some great ways to buy creatively.
- Vendor Take Back Mortgages (I’ve heard of huge VTB’s, zero interest with a 3-5 year balloon payment)
- Lease-options (aka the Rent to Own)
- Existing tenant rent-to-own
- Buying in bulk (the speculator who bought 7 units in the same pre-build)
- And the good old fashioned hard work finding a motivated vendor.
But I stumbled across this interesting video from Jason Hanson’s BiggerPockets blog.
Four tips we can learn from Jason:
- Let the other person talk. A lot. Keep what you say to an absolute minimum, and don’t be afraid of the silence. When there’s silence, the first one to talk is the loser. Don’t be afraid to break it off, hang up the phone and move on. There’s a lot of other listings, and breaking it of is often a good strategy with motivated vendors.
- The Seller named a price first. They who quoth thine desired price first shall loseth thy negotiation. She asked $550,000, he came back around $300,000, which set him up to pitch the lease option, which is what Jason wanted.
- Jason offered a written proposal of his offer. If you’re thinking lease-options or vendor take-back mortgages, you should know how to explain them but you should have it in writing. They’re never easy to explain and there can be a lot of variables.
- End by giving them something. All Jason did was give them another way to contact him, although a more personal one. By moving from the regular office contact information to his personal cell phone number, you make the seller feel more important. He also used the term ‘Ma’am’ towards the end: sucking up a little never hurt!
Now go watch the video, all 7 minutes of it!