For the real estate investor, finding buyers in a slow economy is often a bigger challenge than finding sellers. Buying a house is a financial investment that some people are afraid to make in a slow economy. However, there are buyers out there who you need to attract.
A good first step is to hire a realtor that has extensive experience in selling the type of home that you have and is a full time realtor. Realtors are especially helpful if you are flipping properties because they know that you will have consistent product for them to sell. As a result, they should be constantly marketing for potential buyers and keeping those potential buyers abreast of the properties that are in the pipe line. This will increase the likely hood of having multiple buyers in different stages of the buying process at the same time and increasing the odds that one of those buyers will be the right one for your property. You want a realtor that is pro-active and aggressive. Just putting an ad in the paper or on the MLS is not enough: the realtor should be holding open houses, sending out flyers to the community, finding local hot spots with high traffic and have an extensive network of lead generating connections. In addition, they should be technologically adept, posting on craigslist, backpage, Ebay, and the MLS or have a system already in place that does this for them because the majority of potential buyers now look on the internet first before ever contacting a realtor.
You can also create relationships with realtors who are moving properties in your area by inviting them to a showing of the house before you list it. You can offer an extra bonus if they bring a buyer in a certain time frame, but even if they don’t, it is still advantageous to create a working relationship with the local realtors. It will give you credibility if you plan to do more sales in the area, as they will know who you are and the quality of your properties.
Generally, expect a much longer timeline to find a buyer in a slow economy. Make sure you budget these additional expenses into your overall evaluation of the property before you make the purchase. Keep in mind as well that there will be more houses on the market and greater choices for the buyer. So if you want to get your house sold quickly, develop a plan to make your house stand out in the crowd from the very beginning. If the house is still taking a long time to sell, reducing the price may help. But make sure that when you initially price the house; that you are comfortably in the local market range and not over pricing. Over pricing in this economic environment could mean the kiss of death. Check up on your realtor to ensure that he or she is being as aggressive as possible, and evaluate feedback from showings. What are you hearing on a repeated basis? Is there anything you can do to address the concern? Listening to you potential customer feedback will provide insight as to what you may need to adjust. Often, it is only something minor and thereby finding the buyer you’ve been waiting for.
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Based out of Indiana, Jay Redding is a real estate entrepreneur, with experience in single family and multi-family investing.
