Looking to find a good deal on real estate for sale in a hot market? Whether you plan to hold real estate property for renting, flip it, or want to go for something completely different, buying an investment property can be very challenging. To get a good deal on real estate for sale becomes even more challenging when you’re in a hot market. That’s because, typically, making money in real estate requires investors to find a fixer upper investment property located in prime areas or take advantage of real estate investments that are below market value. This can be rather difficult when you’re competing with other property buyers or in a market with high prices.
But if you desire to have immediate equity in your investment property by buying cheap property for sale, you should strive to find great real estate deals. With the following tips, you can get a good deal on real estate for sale in a hot market and avoid settling for paying the market price for an investment property.
1. Collaborate with a Good Real Estate Agent
One important strategy you can use to find a good deal in a hot market is seeking professional advice from an experienced real estate agent. You need to develop a relationship with a listing agent to secure good real estate deals.
An agent can even hear about listings the moment they hit the market, or even before to make sure you get ahead of the competition. By working with a knowledgeable real estate agent, you are able to get a lot of information on real estate for sale and guidance on how to tailor your offer. He or she will also help you find the best places to invest in real estate. Moreover, a real estate agent will help you come up with a strong competitive offer and offer you some useful negotiating tips.
Be sure to find experienced real estate agents that have a good a track record, winning at least half of their offers. Having the right professionals to guide you through the process can not only help you get good deals but also save you a lot of wasted money and time. Never be apprehensive to seek help and advice whenever in doubt.
Find a top performing real estate agent near you.
Related: The Best Ways to Find a Real Estate Agent
2. Look at Numerous Deals
Finding good deals on real estate for sale is essentially a numbers game. It is important to spend some time looking over available listings before getting serious with any of them. You can do this by scanning real estate websites for new listings or touring open houses.
Avoid the temptation of falling in love with the first property you find. By doing so, you are likely to overlook its problems and probably make a bad offer. The idea is to have a good understanding of the local market without the unnecessary pressure of feeling like you have to make an offer. Furthermore, you will be able to learn about the types of neighborhoods and properties that will have a high ROI, and the features that matter to your bottom line.
3. Use Mashvisor’s Tools
Real estate investing is a lengthy process that requires a lot of knowledge and effort to be successful. However, thanks to technology and the internet, you don’t need to spend many hours searching for profitable real estate for sale. There are several sites like Mashvisor.com that offer tools which investors can use to quickly find affordable properties with positive cash flow. The procedures that would otherwise take a real estate investor hours, days, weeks or even months can now be completed within a few minutes.
Mashvisor has a number of reliable analytical tools to help you in finding the best real estate deals in the US housing market based on your budget and financial goals:
Mashvisor’s heat map analysis can help you find cheap property for sale in any location by setting a filter for listing price. You can then view neighborhoods where the property is cheaper.
Alternatively, you can use the property finder tool to set your desired budget and find properties with a high ROI.
Using the rental property calculator to evaluate investment property based on metrics like cash on cash return, cap rate, average occupancy rate, monthly expenses, and average rental income will ensure you’re not just buying an affordable property- you’re buying one that will make money.
To start looking for and analyzing the best investment properties in your city and neighborhood of choice, click here.
Related: 8 Must-Have Real Estate Investment Tools
4. Buy with Cash
Many real estate sellers will go for a lower cash offer over an offer that is slightly higher but has a mortgage attached. Cash deals are often attractive to sellers since they decrease the risk of the deal failing and alleviate delays while waiting for mortgage underwriting by banks. However, since real estate properties are quite expensive in a hot market, not everyone may have enough cash available to use this strategy.
Related: When Is Buying Property with Cash for Investment Purposes a Good Idea?
5. Obtain a Pre-approval Letter
For those who cannot afford cash deals, you would need a pre-approval letter to increase the odds of you beating other buyers that are also eyeing the property. The pre-approval letter shows the seller of the property that you are professional, have been financially vetted and can make your mortgage payments on time. It also gives the buyer a clue of the price range that they can afford so that they can zero in on real estate for sale that is within that price range. Having an already underwritten application that is simply pending an appraisal will strengthen your offer and enable you to buy the investment property faster.
6. Waive Some of Your Contingencies
Sellers often have the upper hand in a hot housing market, especially if it is a multiple bid situation. To combat this, you need to avoid contingency clauses in your contract. A contingency clause usually gives parties the freedom of retreating from the deal under certain circumstances. Waiving some of your contingencies makes your offer more attractive to the real estate sellers and makes you more competitive. For example, you can waive the inspection contingency by making a payment up front.
Conclusion
The process of finding a good deal on real estate for sale in a hot market can be draining. However, with the above strategies, you can successfully find a good deal on real estate for sale even in the hottest real estate markets. Skilled real estate investors use these strategies and have excellent negotiation skills to beat the competition and purchase profitable investment properties at a bargain.