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Bird Dogging as a concept is a recent innovation. Simply put, a Bird Dogger will scout around a neighbourhood for financially distressed home owners. Many of these are, or soon will be, motivated sellers. The Bird Dogger will then investigate the potential sale by looking closely at the condition of the property and talking to the potential seller. The goal is to get control of the property either through an option or a signed purchase contract. Then the Bird Dogger will sell the option or contract to an investor for quick cash. The Bird Dogger makes money because he has located the property for the investor, and can therefore charge what amounts to a 'finder's fee'. There are a few other variations on Bird Dogging but that is the crux of it. The goal is to eventually learn enough about investing while making these deals, so that at some point in the future you can do it for yourself. Many Bird Doggers become very skilled and is is generally viewed as an excellent way to gain paid experience in the arena of real estate investment. There are a few issues and potential problems that all Bird Doggers face at some point in the process, especially in the early days of their experience. Managing these issues effectively will not only point you towards the money, but also ensure that you gain as much from the education as you can. Because a good Bird Dogger sells profitable deals to others he or she must make sure that the investor is fully informed of any rehabbing that is required and about how much it may cost. Of course, investors are responsible for their own due diligence, but to build profitable relationships the Bird Dog should provide as much information as possible Properties that fall into the Bird Dogging area will, nine times out of ten, be distressed and be owned by motivated sellers. If you can't recognize and estimate needed repairs accurately, how is the whole process going to make anyone any money? If you sign a property over to an investor who then finds that $5,000 worth of obvious repairs are required, you won't last long in this line of work. Good Bird Doggers can correctly determine a purchase price that will leave a nice profit for the investor. You make your profit when you buy, so you must buy right. Only then will you be able to find investors willing to buy quickly. In most cases the investor will be prepared to hold the property for a few months while it is brought up to current standards. Then it will be sold and the investor will get to his profit. The Bird Dog must provide the investor with an equity cushion large enough to cover all repair and holding costs and still produce a profit. Experienced investors know how to crunch the numbers so that they can avoid bad deals. If you can't deliver profitable deals you just won't find investors. The key is to talk to lots of distressed home owners every week. The truth is that only one out of ten will be a good deal or that the owner will be willing to do business with you. By consistently talking to home owners you will be able to find a steady stream of profitable deals and soon you will have investors lining up to do business with you. Be professional in your approach. You are essentially a finder and that is a very valuable service to active investors. They have the money, but most don't have the time to scout out the best deals. Don't contact them without working out the numbers first. And, perhaps most importantly, don't show up thinking every investor is going to buy every deal. Many investors specialize in certain types of property or certain areas. You will soon learn who wants what and you will save time by offering the right property to the right investor. The biggest mistake a Bird Dogger can make is to expect all of your deals to close. Investigate as many properties as possible and do all the legwork. Then, expect some of them to fall through. That's just how real estate works. You protect yourself by having a contingence clause in your contract or option that let's you get out of your deal with the seller if you can't find an investor/buyer within a certain period of time. Investors do not throw money around, so don't expect them to. Do your best, most professional job at all times and stay realistic. Soon you will have the most valuable skill in real estate investing - the ability to find good deals on demand. And that's what leads to real estate investing superstardom!
Article Source: http://www.bharatbhasha.net Article Url: http://www.bharatbhasha.net/real-estate.php/86039 Article Added on Friday, July 18, 2008
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