Should You STOP Looking For Deals? (3 Stages of a Dealmaker)
By Steve Cook

Consider This:

If you're convinced that you should be constantly out there looking for deals, you may have it all wrong.

OK, I know the idea may seem a little counterintuitive. After all, what is a real estate investor, if not the engineer of highly profitable deals? Isn’t the business of real estate investing itself all about hunting and finding the best possible deals, and generating a dazzling income in the process?

Well, yes…and no.

There is no dispute that it is the collection of profitable, well-crafted deals that the savvy real estate entrepreneur will wisely leverage in achieving the personal and financial freedom he or she so desires.

But I would suggest that the best, most experienced investors out there do NOT spend most of their time hunting down deals. Rather, in reality the deals typically hunt down the investor.

The Stage 1 Dealmaker

When I first started in this business, I did, in fact, have to go out and hit the streets looking for deals. What I lacked in real world experience I made up for in sincere motivation and fierce determination. I was out there really digging, scratching and fighting for deals. This is what you might call a “Stage 1 Dealmaker”.

However let me clarify that I wasn’t looking so much for houses. I knew enough from what I had studied to know that what I should really be hunting for were motivated sellers – that is, people with “situations” and “problems” that made them highly motivated to sell their house to someone exactly like me.

“Stage 1” is where I was out looking for the right people with the right circumstances; motivated people who truly NEED someone like me to come and solve their house problem; people who are often willing to go out of their way to find someone like me to buy it from them, and at a below-market price.

Dealmaker, Stage 2

It didn’t take long for me to want to move from the “beating the streets” approach of stage 1 to the much more strategic approach and time-leveraged approach of “Stage 2 Dealmaker”.

Instead of beating the pavement, “Stage 2” focuses primarily on basic but effective marketing strategies or the same motivated sellers. But your time is spent much more wisely, and more effectively. I recommend investors transition from Stage 1 to Stage 2 just as soon as it’s financially practical – and start there if at all possible.

You see, motivated sellers are the people who see the “bandit sign” and think of it as a possible answer to prayer instead of an unsightly bother. They’ll actually call the “we buy houses” ads in the Sunday paper. They list their properties with an agent, just hoping and praying to be handed a ready, willing and able buyer. They often respond to the “Stop Foreclosure!” mailings they receive, or scribble the number from a TV ad they see promising a “written offer within 24 hours.”

These are the tools of leverage for a “Stage 2 Dealmaker”, who is focused on getting their marketing message out, and attracting motivated sellers to call them about their house problem. They’re spending their time screening leads who respond to their marketing rather than beating the streets for another deal.

But the “Stage 2” dealmaker also has to face the daunting task of figuring out which marketing methods are most effective in their market, and which they can reasonably afford. So often, for the Stage 2 Dealmaker, it usually comes down to focusing on a couple of key marketing methods and making them really work for you. You have to pick something and run with it, and try not to spread yourself too thin.

Stage 3: My Favorite

Yes, there is an even better way. And it’s one I seldom hear many people “teach” on. It may take a little time to put together, but when you do, it will generate an ongoing income through a steady stream solid deals with very little effort on your part.

Sound unbelievable? It’s not – it’s real. I call this my “deal network”, and it’s the earmark of the “Stage 3 Dealmaker”.

Instead of running ads in all of the papers and putting signs up on every corner, running television and radio ads, and sending 1000’s of postcards per month, I have taken the time to teach others to do these things. And basically my deal with these investors is that I will pay them a substantial amount of money (not just a small finders fee) for each and every deal that they refer and I purchase.

My network blankets the area with their own marketing, and as a result they come across a number of excellent deals. And because I offer them so much inventive, in most cases, I happen to get first dibbs on all of the choice deals they want to wholesale. I literally cherry pick the grand slam deals and often pass leave the “good ones” to the next guy. I’m also committed to helping my network to move their properties that I do not purchase along to other investors so that they can continue to make money.

It’s in my best interest that these people are as profitable as possible. The more money they make because of me, the more money they will bring me in home run referrals.

Not Deal Hunting or Marketing = 3 to 5 Leads Per Day?

This network, as long as I continue nurturing it, continues like clockwork to produce for me about 3-5 leads per day.

Now as I said, this may not be something you can build overnight. But believe me, you can build it. Becoming a “Stage 3 Dealmaker” with a killer network is just a matter of taking the time to develop solid relationships, helping people succeed, and having the right attitude about doing deals in general. And nurturing your network is nothing more then touching base with your partners every once in awhile to see how they are doing, letting them know that you are in a “buying mode” and that you would like to know what you can do to help them out.

If you take the time to build your deal network, you too can make the kind of income those who are not willing to work for it will never make. And you can position yourself to enjoy a form of “passive” deal hunting that only the savviest investors enjoy.

Blessings,

Steve Cook