Do you ever wonder how real estate investors find good deals? Do you want to know how to find the best deals in real estate for yourself? It’s simple, ask the right questions! Below are questions to ask a seller of real estate.
Firstly, stop buying houses and start buying situations. This one concept alone can make you a fortune if you do it right often enough. Situations exist in every level of the real estate market. Do you think, situations like divorce only exist in one strata of the market? Of course not.
Expose the “Why”
Learning why a seller is selling is so important, because it exposes their real situation. Simply put, you’re looking for someone who needs to get rid of their situation more than they need high profits.
Asking the following questions will help expose the “Why”.
Do you currently have your property listed with a real estate agent? If yes, how long?
It is better to work without a real estate agent involved. Mostly likely you will be paying more because of brokers fees.
However, I have worked through real estate agents and found deals good enough to justify the fee. It does not hurt to make friends with real estate agents as they are often exposed to potential deals you might not find yourself.
Are you the owner on title or is someone else?
Asking this questions makes sure you are talking with the person who has legal authority to make decisions.
How longs has this property been listed for sale?
The longer the property has been listed for sale, the more motivated a seller with a problem becomes.
How many offers have you had for your property? Why didn’t you accept them?
If the owner has declined serveral offers it is likely that he/she is not that motivated. Your time might be better spent somewhere else.
On the other hand if the owner has had no offers, you can determine that the price is too high or it’s inadequatly exposed to the market. This is an oportunity to ask them, why do think your house has not sold yet?
How much did you pay for the property?
This question should only be asked once you have established some rapport with the seller. If he/she tells you they paid a much lower price, then you will need to find out why they are asking so much more. This question will help you determine their level of motivation.
How much did you spend on repairs and capital improvements during your ownership?
If they say none and are asking for a higher price than they purchased it for, it opens a conversation as to why the higher price. Again, this question helps you to determine motivation and flexibility.
Have you made any structural changes?
If the seller made any structural changes without permits, this could cause you a major headache down the road. It may be better for you to move on.
If they made the changes with the proper permits then it could explain why the higher asking price.
What is the worse thing you can think about your ownership of this house?
I like this question because it is a gentle way of exposing potential flaws in the house. Also, it helps to destroy the owners expectation of high profit.
Are there any major improvements that will have to be made shortly?
Again, another good question that lowers the sellers expectation of high profits. And let’s you know what you will have to contend with if you buy it.
What would happen if you didn’t sell your house for six months?
This question above all others exposes the sellers level of motivation. It could also open up oportunities to work with the seller to find sollutions to their real problem.
What is the lowest cash price you would be willing to take if I give you all of your equity withing 48 hours?
Obviously, this questions aims to expose the lowest price. It also adds a time element to it that may motivate the seller to accept a lower price.
What if the seller is offended by your questions?
If the seller balks at any of these questions, ask him/her “is there any reason why I shouldn’t know that informations? Will the answer to that question keep me from buying your property?
I believe that it is extremely important to buld repoir with the seller first. At no time should your questions seem robot like. Let your questions flow with the natural chorus of conversation. It should not be mechanical.
At this point, I just want to emphasize that you are not trying to steal someone elses property. You are only looking for a solution to their problem that also works for your investment needs. In other words, a deal that works for them and makes sense to you financially.
It is important to note, that not all sellers are highly motivated. For those sellers, I only need to talk to them long enough to determine that they are not highly motivated. And for both of our sakes, we just move on quickly. To push any further would only be an irritating waste of time.
Now that I’ve shared with you some questions to ask a seller of real estate, choose the set of questions that feels right to you. Remember your investment objectives and never get attached to a property.
Build rapport with the seller first then expose why they are selling and how motivated they are. Have the mindset of a problem solver, not a thief.
To learn more about real estate investment, read my sister article; Residential Real Estate Investment Tips.
If you have any questions or insights, please join the conversation by leaving a comment below.