If you're a budding entrepreneur interested in pursuing real estate investment as a possible business idea, one of the best ways to get started with little money is by first working as a real estate bird-dog. Quite simply a real estate bird-dog goes out and finds properties for other real estate investors, points them out to those investors, and then is paid a referral fee if and when the investor buys that property. Since many investors are busy working their current deals, it makes good sense for them to generously compensate real estate bird-dogs and others who are able to find excellent deals. Here are a few tips to quick start your success as a real estate bird-dog.
Know What are People Looking For
First, you need to learn what types of properties investors are looking for. Some investors might have specific criteria in terms of the actual numbers on the property, the amount of repairs the property needs, or based on what their intended exit strategy is. By networking with other investors in your local area, at local real estate investor association meetings and other events, you'll quickly find out what the majority of investors in your area are looking for. In most parts of the country, there are certain strategies that work better than others and what's working in your area will quickly become obvious once you start talking to other investors. It's important to know what is working in your area since the investor's strategy for purchasing or getting rid of a property has a large impact on the types of properties they look for in the first place.
Know Where are People Willing to Buy
Next you'll need to know what areas of your city or town investors are interested in. Like most parts of the country, I'm sure your city or town has good areas, bad areas, and areas that are middle-of-the-road. The type of area that a property is located in will also impact the strategy an investor might use to acquire it and how interested they might be in a particular property or area of town.
See What Potential Deals Can You Identify In Those Areas
Once you know what types of properties people are looking for and in what areas, pick a few of those areas and start scouting around for deals. This can be as simple as taking time during lunch if you happen to work near one of these areas. Or you can take a few hours during your weekend or after work to become familiar with those areas and see if there are any obvious deals. Since it might take time to find an attractive deal, you should also make sure to let everyone know the types of properties you are looking for. Of course this includes your friends and family, but don't forget to include individuals you might come in contact with as you're scouting your farm area. It's a good idea to have a big stack of business cards handy so that if you run into a mailman, UPS driver, convenience store worker, etc. you'll be able to let them know what type of properties you're looking for. Since you'll be getting a hefty fee for referring those deals to your network of investors, you can offer these people a handsome reward for tipping you off to any prospective deals and still have plenty of money left over.
You should also talk with other entrepreneurs working as real estate bird-dogs in your area. While some might see them as competition, you should also view them as an excellent source of insider information that could be useful in helping you build your own business.
Hopefully by following these simple steps, within a short period of time you'll be able to find your first deal and reap the rewards while providing a valuable service.
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