The thought keeping many real estate investors up and night right now is where they’re going to find their next deal. Scorching hot markets, like the one we’ve been experiencing in North Texas, can be great for building equity and enhancing cash flow. On the other hand, it’s been increasingly hard to find new opportunities as prices continue to rise and inventory remains low. That’s why it’s crucial, in times like these, to have a systematic approach to your lead generation and pipeline building. Here are our best tips for finding deals in tight markets.
Speed Is Everything
First and foremost, you have to be willing to move fast. When a property does become available that meets your investment criteria, you need to be prepared to make an offer immediately. In many cases, there will be multiple offers on the table, so you can’t afford to hesitate. In order be able to move quickly, your investment strategy and underwriting methods have to be on point. It’s good practice to underwrite opportunities even if they don’t match your criteria perfectly as a way to stay sharp and efficient. Oftentimes we get out of practice by not going through the process of underwriting deals on a regular basis that when a good opportunity comes along we’re slow to react. Practice makes perfect so keep sharpening your skills in all market environments.
Your Relationships Are Your Business
Your deal flow will only ever be as good as the network it’s created by. When opportunity is light we tend to become discouraged and get out of our normal routines. Going to meetup groups, staying active on message boards or in wholesale communities, it can all seem frivolous when the market is tight. The truth, however, is that’s exactly what most other investors are thinking and it’s taking them out of the action. Don’t shy away from your networking habits because deal flow is slow, lean into them as hard as you can and you’ll be rewarded.
Not all markets are created equal. North Texas happens to be a hotspot for activity right now, making it difficult to compete for a limited number of deals. But not every market is this hectic, and the next up and coming area is out there somewhere. Now may be the perfect time to start thinking about investing in new markets. If you’ve never invested outside of your local area this will require you to expand your comfort zone just a bit. But, hey, it’s better than twiddling your thumbs and waiting for the next deal to show up at your doorstep. Take massive action!
If you’ve taken a more passive approach to your lead generation in the past, buying off the open market or through wholesalers, now may be the perfect time to start going direct to sellers. Whether that’s through direct mail campaigns, phone prospecting, or good old-fashioned door knocking, tight markets reward those who are willing to do wha others aren’t.
While the market may be slim with deals at the moment, it will always reward those that treat their business like a business in all stages of the economic cycle. And part of treating your business like a business is working with the right partners to manage your assets with the utmost professionalism and care.
If you’re looking for a team seasoned professionals to manage your portfolio give us a call at 469-649-7666 today!
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