Buyers for Rental Properties
As you build your Power Team you may want to have several questions that you ask each potential member. We value having Buyers as part of our overall real estate power team. We have a few type of Buyers we will discuss. In Power Team Questions # 9, I discussed the Cash Buyer that want to buy, fix and resell, also called a BFF for Buy, Fix and Flip. In this posting we will discuss Cash Investors that want to purchase properties to hold as rental units. We can call these buyers our B&H for Buy and Holds or Landlord Buyers.
These are Cash Investors or also stated as Cash Buyers that want to purchase deals using all cash. By cash we mean liquid cash, cash in the bank, cash in a stock brokerage account, or even cash in the Mattress! Remember a Buyer that is pre-approved by a bank to buy, is not a cash Buyer.
These buyers will want deals that they can hold as a rental property. These type of buyers usually look at the positive cash flow of a property. This can also be said as how much cash they will make each month after they pay all the expenses from the rental revenue they take in. For example, if a home rents for $1,000 per month and all the expenses equal $800 per month, they have a positive cash flow of $200 per month or $2,400 per year.
There is not an exact script to interview your Cash Investor Buyer, but here are several questions you can consider asking your Landlord Buyer that is looking for more rental units:
1. What market areas are you most interested in?
2. What areas do you prefer to stay out of?
3. What are the types of properties you are most interested in? (Single Family Home, Townhouse, Condo or Multi-family).
4. Are they any properties you would never buy? For example, a property that had a fire, structural damage or a certain part of town.
5. What features do you prefer in a property? For example: garage, fenced yard, basement, central air conditioning, etc.
6. What percentage of equity are you looking for in a deal? For example they may state they want to pay 80 cents on the dollar for a deal. Thus, a home that might have a value of $100,000 they want to pay no more than $80,000 and have $20,000 in equity
7. Are you okay with making repairs to a property? If so to what extent of repairs? (Light, Medium or Heavy)
8. Do you have a budgeted dollar amount? For example, they do not want to put more than $10,000 in a rental property.
9. How many deals per month or year can you handle?
10. How many days would it take you to close a deal with me?
11. Can I get an email and secondary number, either cell phone number or office phone, to contact you with further questions?
12. If I find a deal that meets your criteria, how do you want me to present it to you? (Email, Text Message or Phone Call)
13. Do you prefer your deals to have a tenant already in place or do you want the units vacant?
THIS IS MY BUSINESS!
Remember every day you need to say and repeat…THIS IS MY BUSINESS! Keep working on ways to make your business better. Each day do one thing to get you closer to your dreams because if you do today what others are not willing to do, then tomorrow you can do those things that others are only dreaming about doing! Follow your passion and make your dreams a reality! Follow your real estate passion and make a change to make it happen! Live your life in the moment with no regrets!
Building your Real Estate Power Team with the best members will make it easier for you to scale and operate your real estate business. The key is building a successful power team is to find the best qualified people available to help you build your real estate business. If you help your power team grow their business and make money by providing them with opportunities, then you will be working on building a successful business for yourself.
Real Estate Investing can be FUN and a Real Adventure! Live your life in the moment with no regrets! Believe and Achieve! – Joe Jurek
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