Finding house flipping deals is arguably one of the most intimidating and difficult parts of flipping houses. There are tons of reasons people get into flipping houses, you might be a contractor who wants to DIY the whole project, you might a savvy investor with deep pockets, or you’re just someone who really likes HGTV shows and has an eye for design. But no matter what everyone struggles with consistently finding house flipping deals that are profitable, home run, projects. Here’s a few strategies that I use in my business and you can too!
Local and Intermediate Referral Network
– The number one way to finding good house flipping deals is through your own network of family and friends. These individuals know you best and want you to succeed, so letting them know you’re in the house-flipping business is number one. Then, asking them to keep you in mind when they hear about or see properties in distress is the second tip for winning these house flipping deals. It’s also not a bad idea to include a finders fee for someone who brings you a deal. At Brownstone we offer a “bird dog bonus” of $1,000 if someone brings us a deal and this can really get people fired up to find you some house flipping deals. You may tell thirty people that you’re in the market for deals and maybe ten of them will remember when they see a house that needs work. But if you tell all thirty of those people you’re offering $1,000 just for making a connection, you better believe all thirty of those people will remember and a few of them will definitely do some legwork for you.
Real Estate Agents
– Real Estate Agents have their fingers on the pulse of the real estate market and are GREAT at finding house flipping deals both on the market and BEFORE they hit the market (hint: you’re interested in the latter). They are always meeting with buyers and sellers and seeing properties everyday so developing solid win-win relationships with top agents in the areas you want to work in is key. The other thing you should be thinking about is “how can I make this a win-win,” you need to add value to the agent’s business if they’re going to want to bring you deals. Think of “the big 3” time, effort, and money, if you can save someone any of these they’ll be much more likely to work with you. A ready, willing and able real estate investor is gold to a real estate agent because of the amount of deals you can provide them so be sure to have your finances and protocols in place before recruiting agents to help you with the lead generation aspect of your flipping business.
– Attorneys are an excellent source of finding house flipping deals for a real estate investor and this includes probate, estate, divorce and real estate Attorneys. They are usually working with their clients and their best interest but they may have a situation where the client’s best option is to sell to a real estate investor due to the inhabitable nature of the property. It’s less advantageous for an Attorney than it is a Real Estate Agent to have rehabbers on hand but it can still be a win-win situation especially if you’re known for being a fast decision maker and quick to close. Be sure to have attorney’s in your sphere of influence and networking group as they will provide you with some leads as well.
For more on this you can check out another one of our blog posts, How To Find House Flipping Deals Without Any Real Estate Knowledge
Utilizing Neighborhood Tours on Current Project to Find your Next One
– A successful project can be a great tool to leverage through neighborhood open houses to show a successful project. These neighbors have seen these houses in disarray for years and once they see the finished product, they will usually be open to suggesting another house they know that could use your help. They will sometimes turn into champions for repairing their neighborhood and will look at you as a great solution to fixing those dilapidated homes. Don’t forget to mention your own “bird dog bonus” to really motivate them!
– Wholesalers are great leads for real estate rehabbers as they are great at finding house flipping deals and getting them under contract. They then need proven real estate investors to bring the project to the finish line so they can get paid. Make contact with some good wholesalers so you’re on their call list the next time they have a project to sell. Once again this comes back to networking! Attend REIA meetings and other professional Real Estate groups and you’re sure to find tons of wholesalers. Another good place to find wholesalers is at auctions, read more about that here
– Believe it or not other real estate investors are great resources for deals as they can sometimes have more than they are willing to take on and looking to partner or sell a deal. Especially since the vast majority of house flippers eventually fail, there will always be a need for someone to come in and clean up their mess or purchase a house from them that they don’t have the funds to finish.