As the creator of the “Buy Your First Apartment Building Online Course”, I have many potential students and beginning investors ask me: “How do I find motivated apartment building sellers?”
There are many ways investors use to find motivated sellers, however what I see happening a lot with beginners is that They start looking for properties to buy before they fully understand how to identify a truly profitable opportunity. Here are my recommendations on how to start learning about multi-family investing, and then how to find motivated salespeople.
Get started by learning what makes multi-family ownership profitable by following these steps:
- Study and learn what makes an apartment building profitable.
- Read as many books as possible on real estate investing and investing in apartment buildings. It is much easier to learn from other people’s mistakes. There is no need to reinvent the wheel.
- Find a reputable real estate investment club in your geographic area and meet with commercial investor members. These “veterans” are a valuable source of market information.
After the aspiring multi-family property buyer has received a thorough education by reading books, industry magazines, and networking with other commercial real estate investors, you are ready to begin the process of finding a real property to buy.
Contact commercial real estate agents
A great reference source for finding well-trained commercial real estate agents is the CCIM website. The CCIM is a professional designation that qualifies a commercial real estate professional as capable and knowledgeable in the field. You can also find commercial real estate agents through a simple web search.
When looking for a commercial real estate agent, follow these steps:
- Talk to several commercial real estate agents in the area and ask about “pocket listings.” Pockets listings are apartment building owners the seasoned realtor might know who are serious about selling their building, but have not yet listed the property.
- Find a commercial real estate agent who specializes in multi-family investments. A good commercial real estate agent who specializes in multi-family properties should have a great understanding of the prices of apartment buildings that have recently sold.
Alternative strategies for finding apartment building deals:
- Place an ad on Craigslist that indicates what you are looking for:
- You can also place the same ad in the commercial real estate section of your local newspaper, but be prepared to pay a hefty sum for the ad and also be ready for unsolicited calls from real estate agents. Newspaper ads work, but it’s best to use free or more direct methods, such as direct mail.
- Another strategy is to contact commercial property owners directly. This can be done in many ways. Multi-family homeowners can be located by researching the tax records of a metropolitan area. Typically, the owner of the record will appear along with their contact information. The next step is to write a letter that explains who you are and what you are trying to achieve. The purpose of the letter is for many interested apartment building owners to contact you. You must leave your phone number, postal address, and email address for sellers to contact you. You should make it easy for sellers to contact you. Remember, you will need to look at dozens of offers and sellers before you find the one that meets your investment criteria. You can also contact the owners directly by phone. Keep in mind that multi-family property owners are often very busy, so you may want to write a script or have written talking points so you can get straight to the point and get your message across accurately.
“Are you looking to sell your apartment building? I am a commercial real estate investor interested in purchasing a multi-family property in Philadelphia between 5 and 100 units. I am seeking five year owner financing with a 5% down payment or will buy with a twenty%”. down payment and a bank loan. ”
Or, here’s an ad I copied straight from Craigslist this morning:
I BUY MULTI-FAMILY PROPERTIES WITH SELLER FINANCING OR QUICK CASH. Do you need to sell? Moving? Are tax benefits running out? call me for an offer.