Being a finder/sourcing agent is one of the best ways to get started in real estate. The reason for this is twofold:
- First, you can charge a finder’s fee. This fee is normally set by you and varies depending on how much work you had to put into the deal.
- Second, you are gaining invaluable experience by learning how to analyze offers and put them together.
As a property finder you can charge from £75 and up. Many property finders charge a flat fee between £1,000 and £2,500. Others charge between 1% – 2% of the price of the property. As you can imagine, this can be quite lucrative if the property is worth £750,000.
Most property seekers would consider being flexible with the fee, depending on the type of service they had to provide. For example, they would charge you more if they had to search for a property and find out how much work is needed to renovate/restore it, go out and get quotes from the builders and then negotiate a discount that is right for you, than if they just went and found a property below the market value in an area of your choice.
The great thing about being a property finder is that as a beginner you don’t really need any startup capital and you’re learning all the time how to analyze and build deals. You will be looking for investors, so you will very quickly learn about the criteria they use and since they are very likely to be successful themselves, you will be able to analyze their purchase criteria and use them as potential criteria for the properties you plan to buy. buy in the future for you.
When looking for investors, especially early on, you will bring them deals that they will reject. But they’ll usually tell you exactly why they’re being turned down, so you don’t bring them the same offers again. So there’s probably no better or faster way for you to learn which offers are profitable and why, and which offers look good on the surface, but once you dig deeper, they’re best avoided.
There are two possible ways to configure yourself as a property search engine:
- Simply start looking for potentially profitable properties that you think investors or developers will be interested in. Once you find them, educate yourself on them and discuss the deal as if you were buying it yourself. This includes details of the local community, any regeneration planned for the area, shops and transport links, crime, rental prices etc. You will approach professional investors, so they will want to know all the ins and outs. Once you have all the relevant information, try to contact investors and tell them that you have a potentially very profitable deal. The best way to get in touch with investors is to post messages on real estate forum pages and meet them at real estate clubs and networking events. If you’ve done your homework correctly and have a good offer, it shouldn’t be too difficult to find investors willing to consider the offer you’re offering.
- The other alternative is to post messages on property forums or chat pages, and network with property investors, telling them you are a property seeker and finding out what their individual criteria are. You should get as much information as possible from them, build a database of each investor and their specific criteria and strategies, and then source properties according to your specific needs. If you do it right, it will be difficult for them to resist the offers you present to them, because you will only present them with offers that you already know match their strategy.
One thing to keep in mind as a property finder, especially as a beginner, is that it is much easier to search for properties near where you live. So if it’s possible for you to find profitable businesses near where you live, make it your first priority. But if you’re struggling to get the Buy-to-Let numbers near your home to add up, you may have to look a field further afield: sometimes a field much further afield.
But don’t forget, just because the figures don’t add up on a buy-to-let basis, doesn’t mean they won’t add up for a developer who just wants to buy a property, go ahead and sell it outright. us. So don’t write off the area you live in right away, because no matter where you live, there are sure to be some really good quick-change (buy, fix, and sell outright) opportunities that pop up from time to time. weather.
Being a prospector goes hand-in-hand with contract trading, where you can make thousands of dollars on property without everyone actually owning it. So if you fancy making money from property, but don’t really want to be an investor or developer, you might consider one or both ways to make money. You would need to be fairly skilled at any of them and be able to access the real estate market well, but there is the possibility of starting a business as a property finder/provider and having regular clients who would normally be investors or developers. You would know their buying strategy inside out, you would know exactly what they are looking for and you would just go out and find these properties for them. In the short term, this is definitely something you could do in addition to your normal day job.