“It takes money to make money” I am sure you have never heard that. If I bought into this way of thinking, I would never be a real estate investor working the hours I choose to work. I would not be able to travel or do what I want when I want. I would likely be in a suit working in a big building downtown, making other people rich, and not wearing flip flops writing this article.
I talk a lot about ways to buy real estate with little or no money, and I sometimes talk about ways to find these deals. At the upcoming Success Summits, in Denver and Minnesota, I will be discussing how to negotiate the deals once you locate them. In this article, I want to focus on
more strategic ways to find deals. The strategy I am talking about is how to find them without spending any money. In the first few years of my investing career, I did not have money to spend on marketing. Heck, I barely had money to spend on dinner, so I was forced to find inexpensive or free ways to generate leads.
Calling for Cash: This has been, by far, my favorite way to find deals on a budget. The idea with any marketing is to talk to sellers that want to sell you their house. What better way to talk to someone than to just pick up the phone and call them? You will likely make a ton of calls to sellers that are not motivated enough to negotiate with you, but this is a numbers game and some will be motivated. The more sellers you talk to, the closer you get to finding the one that will sell you the house at a price or terms that will make you money. You can get lists of people to call from ‘for sale by owner’ websites, ‘for rent by owner’ sites, and online classifieds such as Craigslist. Sometimes there will be phone numbers in foreclosure listings, which you can get for free at the county building or get for a nominal fee from a title company (or free if you know people who get those lists from the title company and would not mind sharing). If you drive neighborhoods or go for walks or bike rides, you can get phone numbers from ‘For Sale By Owner’ or’ For Rent’ signs too.
Door Knocking: Although I like calls better, this may be the best way to land the most profitable deals. The only reason I like calls better is I can touch more people in an extremely short period of time. If you have the time, I recommend knocking on doors. I know investors that end their day with this. They may knock on 5-10 doors an afternoon on their way home from the office. They are among the most successful investors I know. The doors that you will want to consider knocking on are any that you would consider mailing to. Foreclosures seem to be a popular one, but evictions, probate, and code violations all work well too. Another strategy is to just go to a neighborhood that you like and knock on every door. I have done this with some success. I tell them I am interested in buying a house in the area and ask if they know anyone wanting to sell. I thought I would get people that would want to sell me their house, but what I ended up getting was a lot of gossip about neighbors and I got to know who was in trouble and might NEED to sell.
Flyers: There are a lot of ways to use flyers without it costing you money, aside from the money it costs to print. There was a time when I would walk neighborhoods and place flyers on each door myself. It was good exercise and it was a good way for me to meet the neighbors and get to know an area. You can also hang flyers on community boards like grocery stores and coffee shops. Again this is free,so even if it does not work well, you should be doing it. I think a picture of you on the flyer works best if you are hanging them on community boards.
Networking: The only costs here should be your business cards. You can do this without them, but you shouldn’t. Business cards are cheap, so get good ones. The idea here is to tell everyone you know what you do. This is easier at networking events, but even going to a ball game or riding the bus gives you an opportunity to tell someone what you do. Although I think you should let people know that you can pay them a large referral fee, I have found that the best deals come from people that are really trying to help someone they know out. So when you explain what you do, be sure to focus on the problems you can solve.
Online Classifieds: Many of these are free, so I would suggest posting ads. You are going to be on the sites getting phone numbers to call anyway, you might as wells go ahead and post a free advertisement. It works best to refresh or post a new ad every few days.
Direct Mail: This is a real creative way to get your message out there. For one stamp, you can send six pages. It is possible to partner with other advertisers and have them pay for your campaign. The way this will work is you put together everything, including the list you want to market to, and be sure that the mailings go out. Then you find 4-5 other non-competing business that would be interested in marketing to the same list. They each pay a portion to participate, and you get the campaign for free. Obviously being the only message in the envelope is best, but this a sweet way to get a message out there for free.
You can probably see that each of the ways we discussed takes effort. It really bothers me to see how lazy some new investors are. They expect this business to be easy, like they see on TV or heard at the last seminar they went to. It does not take a lot of capital, but this business does take effort, especially in the beginning. If you have money and not as much time, you can find ways to get marketing done with little to no effort on your part, but if you are broke, don’t expect this to be easy. If you want this bad enough, if you will find a way to make it work. As long as you hustle now, you can create any life you want.
“It takes money to make money” I am sure you have never heard that. If I bought into this way of thinking, I would never be a real estate investor working the hours I choose to work. I would not be able to travel or do what I want when I want. I would likely be in a suit working in a big building downtown, making other people rich, and not wearing flip flops writing this article.
