As a real estate investor, you certainly are always seeking good deals when it comes to purchasing property – and one great way to do so is to find a motivated seller. But how do you know if a seller is really motivated?
For example, you might look at the asking price of a property that has been on the market for a year. If the price started out at $150,000 last year, and today there is little to no price reduction, then that seller is not likely very motivated to sell the property. However, if that same property has had a considerable reduction in price over time, the story could be different.
Often, you can determine whether or not a seller is motivated if you can find out their reason for selling the property. For example, if the home is about to go into foreclosure, the seller will likely be more motivated to sell than if they are just wanting to “test the waters” and see what they may be able to get for it in a buyer’s market.
With that in mind, there are some ways that you can find out just where the seller – and you – may stand in terms of either obtaining the property, or moving on to another potential deal. These include:
- Asking the seller (or the listing agent) why they are selling the property. If there is no specific reason, then it isn’t likely that they are very motivated, and they probably won’t be lowering the price or accepting any offers that are lower than list price.
- Consider making a low offer in order to see how the seller responds. If they make a counter offer, they may be somewhat motivated. However, if they simply reject the offer, then you have your answer.
- See if you can find any other motivating factors aside from price, such as a quick closing date or the ability to rent the property back from you. Opening up the lines of negotiation can be extremely helpful in finding out what the seller’s true motivations for selling the property might be.
If the sale does work out, you will be able to then move forward with another investment. Doing so could require the services of a property manager so that you can free up time and continue to shop for future deals. For information on the benefits of working with a professional property management company, Contact Us.