OFFERS THRU BROKERS NOT WORKING

Are you following all the properties that you made offers on and
Finding out what other investors are paying?

You'll have to Adjust accordingly to your market. If buyers are paying 70-75% of ARV, come in just under that. Test the waters & always keep adjusting.

I went through the same problem here in San Diego. Buyers are paying top dollar & most will pay 80% here. Hard to compete on MLS properties.

Yes Jason, i follow up on my offers almost every day. I'm in the Rhode island & Massachusetts area, where the market is really down. My offers are usually 70% of list price or lower after repairs,and ive made 100sss of offers, no lie 500 offers and been offering 70% of market,or list price for one yr straight thru My buyers brokers,and ive only done one deal this whole year. MLS listings with brokers are just not working here for me. Brokers just make offers,and laugh, saying thats very low, but i'll submit your offer. ALL COME BACK WITH NO ON MY OFFERS.

The definition of insanity is doing the same thing over and over and expecting a different result.

Louie, you need to change your program with the real estate agents if you want some purchases. I don't know exactly how to change your program as I am not where you are, but, get some feedback from your agent and regroup your effort.

Your offers are too low, obviously.

If you are taking a percentage off list, that usually does not work. What if the property is already listed at 15% under market and you make a 65% offer on a property that is already discounted? Base you offers on ARV if you are wholesaling or rehabbing.

Some one is buying these properties. You need to research and find out what the properties you offer on actually sold for. Then find out what the investor sold it for after rehab/remodel.

With all that said, most investors I work with say once it hits the MLS, goodbye deal!! That has been my experience here also. I make 2 to 3 REO offers a day and have only gotten 5 this year. I picked them up at 72% to 75% of ARV. More than I like to pay, but better than nothing!

The banks are nuts these days! Shadow inventory-HA! Its there but they ain't releasing it! UNLISTED motivated sellers are where I get the 65% of ARV deals.
Use bandit signs and NOD notices! I don't know what else you want to hear?

Time for a strategy change!

Michael Mangham
MD Home Acquisitions LLC

Trust what am i doing wrong? I make my offers thru my broker who sends me tons of motivated seller leads, and i make my offers at 30% below list price or Market value, minus repairs,and all get rejected. Brokers are laughing at me, saying is this guy foreal. I been thru tons of brokers working for me,and eventually we part ways. MLS Listings are just not working for me out here in RI,and Ma. Bank owned are not working either. I dont know what more to do. Tried sale by owners from the websites that have sale by owners listed,and no go there either. Tried bandit signs in my area, no go there either. I am doing everything i should be doing, to no avail. I make 200 plus offers and all get rejected. I'VE done 1 deal so far thru the MLS,and thats it. What am i doing wrong to have that bad of a success rate? Any tip would be appreciated?

Mike i make my offers based on comps my brokers give me,or doing my own due diligence,and either way, 30% under that, still not working. Brokers laugh at me. Grrrr !! My offers are on probates,and and properties that have motivated seller in the ad from the MLS. Help please?

Are you submitting offers with non attractive terms for the seller? What kind of Earnest money are you putting on your offers? Are you buying these properties for your own investment portfolio or assignment to others?

500 Earnest Money, after acceptance i put in my contract. Buying to assign, but broker, or seller i do not tell that to.

You might want to adjust your strategy a little bit. Instead of targetting MLS properties, try Craigslist FSBOs, or local websites to target other motivated sellers who dont want to pay a commission to a realtor. If you are looking for Foreclosures, you could also talk to your local banks and check on "other" REOS they have. If you are looking for Probates, go on craigslist and check who is doing Estate Sales and visit them. They might be selling the house too. I am sure once the property hits MLS, everyone will have access to them, and you probably get into a multiple buyer situation missing the chance to get it. This multiple buyer situation normally drives prices higher on properties. Hope this helps...

1.) Like Michael said in the above post, Some one is buying these properties. You need to research and find out what the properties you offered on, actually sold for. Then find out what the investor sold it for after rehab/remodel.
Follow all the offers you made "which can be a lot of work" & it will explain why you didn't get any excepted.

2.) Hang out & build relationships with those investors in your area & find out whats working for them.

3.) What are you using for POF? what are you putting on your contracts?

Simply comes down to what is other investors paying & how strong is there offers compared to yours.

Investors in my area come in with All CASH, 2 day inspection, 10 day closings, 10-20k EMD & they are known for being a serious buyer & they get the phone call when the seller is now motivated to sell at a discount. Also a lot of properties are falling out of escrow & most investors are saying, after the 3rd time it falls out, is when they are getting a decent deal.

What your running into, is the same thing that happened to me over year ago & this is why I shifted strategies in my area & now focus on Home Owners directly & that's when things changed for me. The best Deals, don't even make it to the MLS.

Hope this helps! I do understand the frustration of working hard with no results, but it sounds like you need to network more with the investors in your area & hang out with them. That's another thing I had to do, to figure out where I needed to be.

Michael Mangham and the other superstars!!! Your offers are too low if they are not being accepted by motivated sellers.

As was mentioned, find out what the wholesalers are paying and work from there. You may be able to buy at list price because it is already priced at 30% below ARV. Obviously a blanket offer formula of -30% isn't working. Due more due diligence and learn the market.
You may also be in a market that is not condusive for what you are trying to due. You may need to adjust your strategy or target market.

Just a suggestion...

Andy Sager
DG's AndyS

OK I'll tell you all how i make my offers

FIRST OFF PROPERTIES ARE LISTED UNDER ASSESSED VALUE HERE.

1) I fill out the exact purchase and sale the brokers use myself,and submit

2) in the earnest money, i put $500, but i send them a promissory note payable 10 days after acceptance, or this contract is null and void

3) Price is 30% below market, not listing, minus repairs

4) CONTINGENCY clause i use is subject to my approval of a 10 day inspection

5) Close in 2 weeks Cash

RESPONSE FROM BROKERS: OFFER IS TOO LOW= REJECTED

HOW AM I TO PASS TO MY BUYERS IF I CANT BUY 30% BELOW MARKET?

MY BUYERS DONT WANT ANYTHING ABOVE 30%. SO I'M STUCK, LIKE A FLAT TIRE TRUCK

WHAT DO I DO WITH THAT? THIS IS ALL MLS WORKING WITH A BROKER

TIPS WELCOME DGF ?

The motivated sellers are a joke. The properties here most are selling under assessed value, but these motivated sellers are trying to get over the assessed value,and above the market value. Makes no sense

Ask your agents how other investors are making money. Or at your REI club you could ask the other investors how they are making money.
In my town, what a lot of investors are doing, is buying, holding, and renting. They are mostly buying repossessed homes, not really directly from owners.
Just ask; this is what an agent told me.
Hope this helps.

RENinja

you're not doing whats right.

You're trying to put a square block in a round peg

If after 25 tries you got nothing, that should have been a sign for you to adjust your strategy.

All this talk about agents not doing this and doing that is an excuse for what really happened; you came into this with the wrong strategy.

Adjust your offers to what will make the deal; if you keep throwing a specific offer into everyone and its not going through, who's at blame??? Not the sellers.

Just because a seller is motivated doesn't mean they're needy and willing to take anything. big difference.

Before you present another offer, think wisely and speak with your agent(s) so as you're not wasting anymore peoples time.

Hope this helps.

THANKS ELIX, YOUR PARTLY RIGHT. I SEE MOTIVATED SELLER IN THE AD, AND INSTEAD OF REALLY DIGGING DEEPER TALKING TO THE BROKER, I AUTOMATICALLY MAKE THE OFFER, THEN DISCUSS IT WITH BROKER, AFTER ITS BEEN REJECTED.

I'm completely right, because you completely agreed with me lol

When you get a property, tell the agent what you want to offer and why. Then let him tell you what he thinks, ask him to speak with agent to discuss offer without doing the paperwork. This is normally what I do and this recently was the case;

An unlisted 2 family home from one of my investors wants to flip for $210k

I speak with one of my buyers. He says offer $160K. I tell him let me see.

"Joe, can I get it for $160k???"

No absolutely not, other people have to eat

"Whats the minimum??"

$195k

I tell my buyer, he says he'll do $180k can close next friday and $10k for me

I tell Joe $180k and he can close next friday. Joe calls back $185k. I tell him my guy can't go over $180k, he says ok

Done deal

Take your time, and have a plan for each individual property; throwing to see what sticks doesn't work.

Louie,

I know a lot of people offer on owner/occ. properties through an agent but for me this has been a total waste of time. They do not accept low ball offers 99% of the time. Maybe you will get one or two a year but that is no way to build a consistent business.
REOs are tough right now, but those are the properties I offer on, most often directly with the LISTING agent. Short sales and HUDs too. Those are the only kind of offers I make through an agent.

I find DISTRESSED, MOTIVATED home owners through my own marketing. I use my own contracts and work directly with them, NO AGENT INVOLVED. These contracts are by far the easiest to assign (They state they are assignable) No agent or bank can complain!!

Again, time for a strategy change!!!!! The properties/sellers are out there.

Michael Mangham
MD Home Acquisitions LLC

I am an agent and can tell you from experience that you will not get very many offers accepted the way you are doing your offers. First off, when an agent puts motivated seller on a listing that means the seller is willing to go down a couple of thousand dollars. Their version of a deep discount and an investors idea of it are usually very different. After a while you will get black listed because they think your are an unreal buyer.
Having said that, if your agent knows how to use the MLS, you can find many deals.
I have been buying, rehabbing and selling properties for 15 years, have had my agents license for 5 years. I used to send out a bunch of low offers like you are and I would occasionally get one accepted, but I learned, after I got my license, that there is a more efficient way to work.
I have always, almost exclusively, bought REO's. I have done a couple of estate sales and short sales, but they are few and far between. Short sales can take a year to get approved and estate sales can have, and usually do have siblings fighting to get an extra nickel out of the property. So stick to REO's when using an agent. In my area there are only a handful of agents who get those listings and after a while you get to know which ones have a clue as to how to price them to sell at a price that makes sense for the condition of the property.
I also know what I am looking for. Because of that, I get 75-80% of all offers I submit for myself and my clients accepted.
I frequenlty get proerties at 40-50 cents on the dollar. I find 5-15 of these per month in my area, so I put out very few offers. This is much more efficient and takes a lot less time. Trust me the great deals are out there.
Look at the price of the listing and what it can sell for (ARV). You will know almost immediately if it makes sense to make an offer. I have found that if you can get it 10-15% below list price, you are doing very well. I typically buy houses at $30-50k and resell them at $80-105k). Sometimes I will offer a little above asking price if I know it is a good deal, because there will be multiple offers on it, but it still makes sense.
You really have to know your market, how much profit you want to make, what the rehabe costs are... Something else to remember when doing this strategy, you cannot assign the contract when buying REO's. The banks won't let you. But you can do a double closing to accomplish the same thing.
I hope this helps.
Much luck to you.
Don't give up.
jbezoski

I want to thank you JBEZOSKI,and everyone for your support,help,and feedback, regarding my problem i was having making offers,and not getting many acceptances. Today i took everyones advice, and got better responses to my offers today. Instead of just making 20 low ball offers a day as i been doing, i made just 2 today after discussing my offer to the listing broker, and they basically told me, the lowest offer seller could take. Most i passed on, and just 2 looked promising, numbers worked,and made the offer. Now just waiting for the response. I feel more confident now, making my offer the way you all told me. Thank you all so much. I will let you all know when i do my next deal.

...you took our advice. Sometimes you just need to tweak the presentation
I know when I sold my Mom's house last Dec., the eventual buyer started out making a very low offer. I responded to my agent that I would not listen to any offer under XXX dollars. As these people were end buyers they changed their offering method and wound up with a great house. You may have been getting the same treatment by your sellers. Just because it's a buyer's market doesn't mean that sellers are giving away their properties. We're seeing that here in my part of FL. In some areas, even the banks aren't giving away the properties. You can still make money tho with the right strategy. It's all about helping people solving their problem.

Best of luck and we look forward to hearing about your closings

Andy Sager
DG's AndyS

Thanks for the inspiration Andy