Most major markets around the country are fiercely competitive right now. Houses are getting sold for over the asking price all the time in my market, which is insane.
It makes me wonder, how am I supposed to find good deals when there are so many fools with money, making offers far above anything that makes financial sense for an investor?
I might have just found a way.
As of late, I’ve been writing personalized letters to the sellers to accompany my offers. Not just a boilerplate template, but something that I put actual thought and feeling into.
Rather than just sending a cold purchase agreement with a number on it like everyone else does, I’ve been trying to put some real emotion and personality, so the seller can get to know me and understand why I like their property, how I plan to use it and what a difference it will make if they decide to sell it to me. I basically give them a compelling story and a reason to say yes to me, which is something almost no other investors are doing in my market.
I was able to get a deal under contract this way even though the seller had other “better” offers from other people. I’m going to keep trying it, since the concept has been proven in at least once case. I figured I would drop the idea here, in case anyone else finds it useful.
@charlotteirwin i truly believe it can work. I only think at it as a different business model as you probably can’t reach as many people as you normally would do with a standard campaign mail. It’s not a numbers game anymore but a very targeted approach and i can see its validity, especially if you have writing skills and can select the most appropriate potential customers. Let us know how your experiment goes and good luck with that😉.
@Danielle I have not been doing this with land yet. Only with houses so far.
This approach seems a bit less practical for a land flipper because of how many offers need to be sent out. The whole approach and mentality is just completely different.
With these houses I’ve been writing letters for, I’m willing to at least come close to the seller’s asking price. These are situations where I’m competing with other buyers who are asking well-over the seller’s asking price, and I’m just trying to get them to consider me as a viable offer.
With land deals, I am clearly low-balling my offer and the seller’s asking price is mostly irrelevant. From what I can tell, the people who accept these offers are doing so because they just want the cash and they want to be done with their land. If this isn’t already their frame of mind. a nice letter from me wouldn’t be a big enough motivator to get them to consider me.
Thanks for sharing this idea @charlotteirwin! I can totally see this working. Not that it will always work, but if there’s any doubt, it probably can’t hurt to try.
We actually got our current house (my primary residence) by doing this. Funny thing is, we didn’t even write the letter. We told our realtor the story of how much we wanted the house (I literally had my eye on it for years) and then he wrote the letter for us (this guy was a top-notch agent, he went above and beyond like that).
There was another competing offer that came in at our same price, and because our agent took this extra step, we ended up getting it.