Building a Buyer’s List
By: Scott Costello, founder of Struggling Investor.com
Your buyers list is your black book, it’s a guide to how much you are gonna pay for a house and what part of town the house can be in. You NEED a good buyers list in order to be successful at wholesaling real estate. Think of it this way, how much easier is it to pick up the correct groceries when your wife gives you a list as opposed to trying to “think” of what she wants? Try the latter and it is a quick way to getting into trouble…haha
You should have a wide array of buyers. Buyers for low-end homes, high-end homes, rentals, multi-units, rehabbers, newbies, and as many cash buyers as you can find. These guys make life easy!
Here is a great list of places you can look to find buyers…
Run ads in your local classifieds
These ads should be simple and to the point. Use a generic ad like “House for sale – 60% ARV in Goodtown Town”. When people call just tell them you currently don’t have any but will call them when you get your next property
Run the same ads you place in the classifieds here. Put a phone number and email address in your ads or better yet create a squeeze page and direct them there to sign up. Just remember that keep the ad simple, people tend to stop reading if the ad is to long or complex.
Call For rent signs/ads
Why would you call for rent signs you might ask? Well because the person renting the place, the landlord, might be an active investor and looking for more properties. If you area is a high rental area you’ll find so many buyers it’ll be funny.
Call for sale ads
While you are calling the for rent signs you might as well call for sale ads. Keep track of the seller and if you find multiple houses being sold by the same person/company you know you have yourself an investor.
We Buy Houses Signs
These are obviously investors and if they are active and looking for houses you want them on your list.
Who has access to the most buyers? Realtors! Every agent your meet ask them if they have any cash buyers. If they do get their information or have the Realtor give them one of your cards.
Ask your buyers
They may be very protective of their buyers lists, but it can’t hurt to ask. You might even consider paying a few bucks for their list. Just make sure it’s legit.
Local REI meetings
Where all the investors gather. No place better to find a buyer then at one of these meetings. Pass around a sign-up form and also meet as many of the other investors as possible.
If you have a house for sale, put a brochure box outside of it so any investor that comes by can get your information and contact you for other deals you might have or come across.
Court House Step Auctions
Another gathering place for investors. You basically want to go where ever investors might be and hand out your business card as well as collect business cards.
Create a Blog
This will build your credibility as well as help you network with other investors. Those relationships you build here will definitely lead to buyers in the future. This is more of a long term strategy that should be used along with the others mentioned above.
Hard Money Lenders
Investors need to borrow the money from someplace, so you know hard money lenders have a long list of clients that they would probably share with you or at least pass your card along to.
MLS looking for cash buyers
In some MLS systems they keep track of the way the house was bought. Was it payed for with cash? if so you possibly have an investor, A CASH BUYING INVESTOR. Make sure you contact this person and see if they are buying more.
That list above should really get you a very good buyers list. Remember though you should always be working at adding buyers to your list as investors come and go.
Now you want to know what information you should get from your potential buyers when they contact you. I usually ask the following..
- I usually ask them whether they are still buying,
- what they are looking for,
- what percentage up FMV they are typically paying,
- what areas of town they want to buy in.
Also you need contact information, so get these items…
- Email address
- Company Name
- First and Last Name
- Company Address
- Preferred Phone
- Type of property they are interested in: Single Family, Multi-Family, Commercial
- Cash buyer
- What level of Rehab are they comfortable with?
About the Author:
Scott Costello is a real estate investor in Northern New Jersey market. He struggled to get started in the business and shares his experiences with others in order to make it easier for those who follow. Learn more about Scott and his struggles on his blog “Struggling to Get Started: Making Mistakes but falling forward” at Struggling Investor.com.