How To Find Great Deals From Property Managers
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Read Transcript for “How To Find Great Deals From Property Managers”
Joe: Welcome to the new series of video blog questions. I sent out an email and asked you guys to send me all of your questions about real estate, so I’ve got all kinds of things here that I’m going to try to cover over the next few weeks one by one, and hopefully I’ll be able to get to your question as well, or at least a question that was very similar to yours. We tried to filter out some of the ones that were similar to try to get them all into the same batch.
“I love your program and it’s gone really well so far. I do have one question, though. A lot of the for rent homes in Las Vegas use property managers. Is it smart for me to contact them about the rent to buy program, and if so, what’s the best way to go about it?” – Devette Webelle
Joe: Absolutely – property managers can be a great source of leads. People would think, ‘A property manager makes money by filling properties,’ and that’s true – they do usually charge the landlord a fee to fill a property, but most property managers that I know don’t enjoy that process very much and they have a lot of pressure from their investor to get those properties filled as quickly as possible.
Joe: We can fill those properties. Even with a lease option, it makes sense because the property manager gets the property filled; they get it taken care of.
Joe: You get business from them over and over again. As those properties go vacant, you can fill them again. If they have other properties, and let’s say they have up to 500 properties, you can keep filling those properties for them and put lease option tenants in them.
Joe: We know that less than 30% of lease option buyers will actually exercise the option, which is usually okay for the lease option buyer (and we talk about why in other videos) but it’s also good for the landlord because it puts somebody in that property who’s going to take care of it more than if they were just a renter.
Joe: You know the old saying: “You never wash a rental car.” You’re going to take care of the things that you own, but you’re not going to take care of things that aren’t as much.
Joe: So I say it does make sense to do it. Property managers will work with you if they believe that you’re competent and you can do the task that they would prefer not to do. They would prefer to make money by just letting that property collect the 10% that they get every month. You can make that possible for them by filling that property and getting paid the lease option fee as you fill those properties.
Joe: It doesn’t matter whether you’re in Las Vegas or in New York or Indiana or Kentucky – it doesn’t matter where you’re at – property managers are in the same situation and it makes sense to follow up with them.
Joe: Now, as far as dealing with realtors, I would suggest that, as a beginner, you don’t deal with realtors. They’ve got a different agenda. They’re trying to accomplish something different, and if you don’t explain yourself properly, they may at some point accuse you of practicing real estate without a license (which is against the law). You want to make sure that you can explain to them the way you do it and the way you’re working as a principle.
Joe: It is legal for a principle in a transaction to sell their own property – that’s why you have for sale by owners in every state of the union, and its legal for you to do it as long as you become a principle.
Joe: That’s what the “For Rent Method” is doing – it’s making you a principle in the transaction and making it legal for you to sell that property. If you don’t have the lease option memo signed, you’re not doing it legally, so make sure that if you’re doing this, that you do it the proper way (the way that I teach in this method). Alright, I hope that helps. Good luck.