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Good techniques will help you make more with real estate consistently. Being a wealthy full time investor isn’t for everyone, however, it is still worth your time and effort to know a few techniques to save money on property. Here are the 7 most important real estate investing secrets for free that will show you how to find a better deal.

1. Get a discount on that property or don’t buy it

Getting a property for lower than market value can be achieved a number of ways. One example is getting your property for favourable terms as many buyers do not realize that price and terms are essentially the same thing. The important thing is to understand what variables would cause a seller to sell their property for less than it is worth. Knowing this will allow you to find the right set of circumstances that will allow you to profit. That’s the advantage to a great set of real estate investing secrets. The circumstances of the seller will determine when a good deal is possible as the home location is usually irrelevant. Great investors are always marketing to attract the right circumstances.

2. Know how cheap the seller will before you even show up on the scene

The “asking price” and the “selling price” are completely different things. Any good investor will tell you that an asking price is relatively meaningless. If it really meant anything, asking price would be the “getting price” and it rarely is. Without ruining the negotiation, here’s how you can get a cheaper price on a desired property. Make a lowball offer on the home through a third party (that you know) that can be voided. That way, they won’t have to actually buy the property and you’ll know if the seller is offended by that offer. It gives you insight to know just how flexible the seller is on their price. The asking price will often be countered at 10-20% off. You’ll actually walk in your negotiation with a clean slate but you’ll have a better idea of what the seller will actually accept. When you know ahead of time that your seller will come down 10%, you can save yourself 10s of $1000s and a lot of wasted time. In their mind the lowball offer didn’t come from you either so if they get offended, they won’t be offended at you.

3. Write a contract that has an escape

Most residential real estate deals have clauses that say things like “offer conditional upon home inspection within XX days.” You’ll want to include a similar escape clause in your deals. You do not need to prove you did a home inspection or that it actually met your terms. You can use this as an escape to make an offer and then back out if you are unable to sell the home for a higher price. Good investors make offers all the time that they can back out of because they know the value that controlling a property represents. Resell the property first for more money or back out of the contract which takes all the risk out of investing.

4. Homes aren’t like playing the lottery

“Hey, I am taken by the brochure of that mutual company so I will buy some shares.” It sounds “investors” don’t give much more business analysis than that to real estate investing. It the numbers don’t indicate that it will be profitable, actually crunch the numbers or just don’t buy it. A second property can have a large time commitment involved so just imagine if you were going to lose money on it. Buying a home without analyzing the numbers is just like buying from the company brochure.

5. Have multiple exit strategies

You’ve probably heard on the TV to “buy, fix up, and flip.” Unfortunately, most spoon-fed ideas to the public are really not that profitable. For instance, selling a property and holding a second mortgage often pays the same cash returns that a rental property does without all the added management. Before you take title on a property, know at least of your creative options. You’re already well behind if you go looking for a renter after you’ve already invested in a piece of real estate. In your repertoire, at least know how to lease-purchase, create paper and wholesale before you just buy and hold.

6. Landlording is rarely as good as it’s professed to be

Typically, 10% profit on rents is what’s expected on a 2nd rental property. That means that if you’re renting for $1000/month, you can anticipate about $100 profit per month. Is a ten percent spread really worth that much of your time? Are you willing to fix toilets, porches and flooring for $1200 per year? Creative investors use creative strategies for a reason. The bank makes a huge profit on your home without any real management and physical labor. Learn to make a profit without spending all of your time.

7. Marketing

You can either go out and find a great deal or you can learn to market so that great deals come to you. business professionals like mortgage brokers and real estate agents keeping their eyes peeled for you for the right fit. If you want to make the big money though, you need to know how to creatively do deals and market for them. Realtors and brokers don’t really do any investing so although they can find some good deals, the best deals aren’t something they are accustomed to investing in. That means that the best deals go through investors who market to attract them instead of through realtors.

The major secret is that the best deals always go through investors who know how to find them.

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