Finding Motivated Sellers

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From: Mickey Wong


Hi Everyone,

Other than calling vendors/owners direct on newspaper advertisements on FSBO houses, are there any other options of finding motivated sellers here in Melbourne?

Read some posts in Richdad.com and the americans have a system where they go to the country courthouse or recorder's office to obtain information on unpaid property taxes, foreclosures and mortgage payment defaults.
Was wondering if that sort of method is applicable here. If so, do we just go to the city council and obtain this information.
Just wondering if anyone who has used this method to obtain information motivated sellers.

Thanks
Mickey
 
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Reply: 1
From: Jeremy Laws


MOtivated sellers in hot markets are pretty hard to find. Try inner city Sydney, or maybe Melbourne. Sheriffs type auctions do not happen here......
 
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Reply: 1.1
From: Mickey Wong


THanks for your reply Jeremy,

Melbourne is really a hot market now, with certain areas you can expect up to $1000 increase in capital gain in a month.

Not really referring to sheriff auctions, but more to pre-foreclosure and really motivated sellers, for eg, out of state owners, vacant houses, divorce, unable to pay mortgages, decease in family etc. where the house needs to be sold or put into the market for quick funds.

Have not really spoke to or seen anyone here in Melbourne or heard anyone else in Australia trying to use any of the methods used by the Americans to get creative deals.
Then again, I might be looking hard enough. Just wondering if anyone has done it before or heard of someone doing it be it an investor or just someone adopting these creative techniques used in the US.

Had a job interview with a property buyer's agent and spoke a little about investment, she reckons it's illegal( but she has no evidence or law to back it up). Interview went quite sour of her trying to back up her argument, guess I don't need the job anyway.

Cheers,
Mickey
 
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Reply: 1.1.1
From: Wei Ng


I'm sure there are lots of divorce/out of state owners/ whatever out there. Question is not whether they are available. Question is HOW you go about looking for them. Don't let anyone tell you that you can't. I'm in the same boat as you are.

What I'm doing now (besides researching a suitable wrap area AS WELL AS looking for a home) is to send letters to owners of run down properties to gauge their interest in selling. Drop me a mail- we met during the last Freestyler's.


Cheers
Wei
 
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Reply: 1.2
From: Kristine .


Sorry Jeremy

On 7/15/02 10:19:00 PM, Jeremy Laws wrote:
>MOtivated sellers in hot
>markets are pretty hard to
>find. Try inner city Sydney,
>or maybe Melbourne. Sheriffs
>type auctions do not happen
>here......

But actually, if you care to look in 'Public Notices' in the daily papers you will find that the Sheriffs Court often publicizes notice of auction of property in order to satisfy debt.

The main drawback is the Australian pattern of buying property in the name of both spouses. Therefore, if one spouse defaults on a debt, it is only their share of the property which can be seized by the sheriff. Would you really want to buy 'half a house' in that circumstance?

And Mickey, there are plenty of deals to be done out there. You don't need to act like a vulture to find them. However, there is no substitute for legwork, phone calls and networking. It won't happen sitting at home wondering where to start. But if you make it a habit to go to eg not less than three open for inspection or auctions each Saturday and another two each Sunday, you'll soon get a feel for the market and be amazed how many fantastic deals are out there.

Remember the KISS principle. People have been buying and selling property since Adam was a boy. Get your finances in order, put your cheque book in your pocket (not your credit card, remember) and start knocking on agent's doors. Agents get their listings from knocking on doors, too, a lot of their time is spent prospecting for listings and rentals,and they are prepared to literally walk the streets to do that. Just today I received a 'cold call' from one of my local agents, looking for listings.

Success, the old saying goes, is 10% inspiration and 90% perspiration. I wish you luck with your search - your good fortune could be just around the corner (literally).

Cheers

Kristine
 
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Reply: 1.2.1
From: Mike .


Hi Mickey,

Beware the downside of suggesting to RE agents or vendors various creative finance strategies. They may take the attitude that you are too difficult and overlook you in preference to someone who will take a more conventional approach. To accept a creative deal from a buyer means the vendor usually has no other potential buyers and is desparate to sell. Keep It Simple is a better policy.

How to find good deals and motivated sellers?

1) Advertising

2) Pick an area near you which is affordable, and where most properties sell in under 3 months. Don't pick drug or crime areas.

3) Become an expert in that area. Learn all the property types and which ones will bring a profit for makeovers or renovations. I doubt Housing Commission flats will.

4) Drive through regularly and note properties with peeling paint, overgrown lawns, generally untidy appearances. Chances are that finances are tight for the vendor who may sell the property to you. Alternatively, offer them finance at better terms than the banks to fund repairs to the property.

5) Enlist spotters like newspaper boys/girls, tradesmen who see inside the places, postman etc, anybody working in the area. Give them a spotters fee for giving you leads on distressed property. Offer them a bonus if their lead is bought.

6) Do a deal with RE agents that you will sell through them if they provide you with leads. Make sure you can buy a lot of their stuff though, otherwise, they may lose interest in you.

7) Do mail drops to these properties. Chances are many will be rented so landlord owner won't be there. Use Online Title searches to get info about owner's address.

Hope some of this helps.

Regards, Mike
 
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How to find motivated sellers.. REAL examples !!!

Reply: 2
From: Ross Sondergeld


Hi Mickey,


How to find motivated sellers.. REAL examples !!!


You said, "Other than calling vendors/owners direct on newspaper
advertisements on FSBO houses, are there any other options of finding
motivated sellers (...here in Melbourne)?"

Although I don't deal in Melbourne. I say that the market is HOT !
Therefore, you have very few opportunities to find bargains.


Anyway...

Here's a REAL example from the Gold Coast in Queensland.


# 1 The foreign owner...


Foreign seller owns a rental property in a prestige pocket, with a "funny"
residential lease attached to the property.

Funny? Yep... tenant has a 5 year lease with conditions attached to the
agreement. For example... NO real estate signs in the yard and NO
advertising that the property was for sale... (plus he was the only party
that had the keys!)

Anyway... i knew it was for sale. (I was acting as a buyer agent.)

When we tried to do an inspection... the tenant said, "No inspections
allowed." But my guys put in an offer straight to the foreign owner and the
offer was accepted. (Sight unseen... no building inspection, etc.)

NOTE - I'd seen it 1 year earlier when the tenant was a little nicer.

Anyway... it was bought for $470k in 2001. (Today $650,000 plus.)


Summary - Uneducated seller... unusual tenant... some risk = Bargain.




Ross Sondergeld ~ Buyer Agent

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
" Imagine buying real estate the easy way...
...with a Buyer Agent on your side!!! "

Buyerside Real Estate Mobile 0412 289 464
Office 9b, 34 Glenferrie Drive Office (07) 5562 1555
East Quay Corporate Park Fax (07) 5562 1248
Robina QLD 4226, Gold Coast Buyerside@hotmail.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~


_________________________________________________________________
Join the world’s largest e-mail service with MSN Hotmail.
http://www.hotmail.com
 
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Reply: 3
From: Mickey Wong


Thanks very much Ross, Mike and Kristine , really do appreciate all the feedback and advices.

I'm lacking in capital and finance and therefore would not possibly qualify for loan, (just working partime). My strategy is flipping for building capital and accumulating cash at the same time learning more on real estate.

I have actually a booklet of information on pdf format by an American investor who is an expert in preforeclosures and flipping in general. I'll be welcomed to give you the link to the site. Just drop me an email if you're interested.

The market in Melbourne is overheating according to everyone you speak to on the street, but, I'm very sure there's a deal out there lurking day in day out. Well, the due diligence part is for me to unveil them, i guess being a newbie, this is the challenging part. I went to 3 home inspections during the weekend, went to one in Glen Waverley where the agent told me you can't get anything lower than 400K in that suburb, the vacant land next to the house just got sold for 300+K.

Due to my age, I doubt any agent will take me seriously, well not to mention my finances as well, but I'm doing all it takes to build up my capital, I'm also networking and meeting up with private investors who I can try to partner with when I find bargains or flip them the property with a finders' fee.

By the way, how do you make a title search online? I'm going to the city council tomorrow to find out more on searching for properties.

Thanks for your time and advice,

Cheers,
Mickey
 
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Reply: 3.1
From: Mike .


Hi Mickey,

I have to admire your enthusiasn to find ways to get started despite the lack of capital. I'm also considering Flipping here in London. Good way to learn about the property market, makeovers and renovations.

If you find a great deal why don't you use Caveat Emptor to find a money partner to fund the reno? The profit ratio should be based on who carries most risk ie who is risking their capital.

If you have no money in the deal, perhaps you can take 20-25% of profits. As your capital grows and you can invest a greater share then take a larger slice of the profits. Eventually, you won't need money partners.

I also have a couple of good PDF docs by an American - David Whisnant. Is that the guy you are referring to?

As far as online Title searches are concerned try:

http://www.land.vic.gov.au/web/root/domino/cm_da/lcnlc2.nsf/VP/titles,+plans+and+certificates-property+titles

Also of interest:

http://www.business.gov.au/BEP/Search/0,1317,a12%253D86%2526a5%253D5%2526a7%253D1%2526a8%253D%2526a9%253D%2526a0%253D83%2526a1%253D%2526a2%253D%2526a10%253D5,00.html

]http://www.nre.vic.gov.au/web/root/domino/cm_da/nrenptm.nsf/frameset/NRE+Property+Titles+and+Map+Info?OpenDocument&[/4A25676D00243E09/BCVIEW/3893BAE48901ECAC4A256785001CD816?OPENDOCUMENT]

http://www.land.vic.gov.au/web/root/domino/cm_da/lcnlc2.nsf/cd/Land_Channel_Start?OpenDocument

Best Wishes - Mike
 
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Reply: 3.1.1
From: Mickey Wong


Hi Mike,

How's the weather in London mate? Into football? I'm a big Chelsea fan myself.

Anyways, thanks for the reply and the useful title searching links you provided. It's getting late now, almost 3 am, so I think I will be trying on it tomorrow.

By the way, the PDF link is by an American investor who frequents the richdad.com forum by the nick name of UtahInvestor. Recently they had a gathering of RE investors in Las Vegas which turned out very well. Heard several RE investors from Australia were there as well.

I've been told that flipping might bear several tax consequences and licensing issues. I'm not too sure about that, need to do more due diligence but the property transactions here in Oz seems a little tight as in everything has to be licensed, I've still yet to meet a flipper who has 'been there done that' here in Melbourne. Everyone is taught to negative gear here.

Anyways, thanks very much for replying and the links you gave.
Cheerio,
Mickey
 
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Reply: 3.1.1.1
From: Jeremy Laws


Kristine, nothing like foreclosure sales exist in Aus. I have bought foreclosures in US cos I couldnt get the in AUs. The market here (although I am in London atm) is too small. Have a look at www.foreclosureworld.net to wet your appetite.
 
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