Tell me if this sounds familiar to you:

‍“There’s no good deals out there!”

“Everything is too expensive!”

“There’s nothing to buy!”‍

Sound familiar to you? Because it sounds familiar to me. I’ve been hearing that almost every day since I started back in 2012. And I remember that when I would hear that in the beginning I would think:

‍“Oh maybe they’re right… maybe there’s nothing to buy?” 🤔

But here’s what I learned these past few years. Buying Real Estate is not a spectator sport. You’re not going to find the perfect deal sitting on the sidelines. Its not going to just come to you. It doesn’t work that way.

I actually love it now when someone tells me that ‘there’s nothing to buy’ because I tell them the exact same thing every single time. I tell them:

‍“You don’t find deals, you create them!” 😏

Sometimes they’re a little confused by that so I say to them:

‍“Look… the deals that sell… for the prices 💷 you want… happen because someone put in the work….” 💪🏻

Let me tell you a little story to show you what I mean…. 📖

Creating the Deal

In 2014 I had a property listed on the market for about a year. It got some offers and had some interest but nothing serious - granted it was listed about $75,000 above market. But the point is that this deal was available to the world, anyone had access to it and everyone saw it. From the outside looking in 👀, it wasn’t a deal at all…

One day one of my clients calls me after he had just finished refinancing a building that I had sold to him about a year ago. He says:

‍“Hey Edward I need to buy again and its sorta urgent. My condo lease is about to expire and I can’t renew because the owner wants it back. I need to find a fourplex ASAP for me to move into” 😰

And so I responded:

‍“Look I got this deal thats close to Echo Park...the area is up-and-coming! Its not really on anyone’s radar right now but I bet you that will change. Why don’t we put our heads together and see what we can do?” 🤓

So he puts the property in escrow and while were in escrow he requests that the 3bedroom+1bath be delivered vacant because he was purchasing with an FHA loan. I go to the sellers and I say:

‍“Look he’s paying your price… he’s serious…he’s qualified… and I’ve worked with him before. Lets talk to the tenants. As a matter of fact I’ll talk to them! If they say no well then no harm no foul, at least we tried” 🙏🏻

So then I negotiate with the tenants and get them to agree!! Now let me explain to you what just happened and the value that was added through that successful negotiation. By him getting that 3bedroom+1bath vacant he added about $200,000 worth of value while in escrow! Let me break down the numbers to you even more. He bought the property for $825,000 and today its worth about $1,400,000. Now keep in mind he only put 10% down because of FHA which means his original $80,000 investment grew to almost $600,000 in less than 6 years. That’s a 7.5x return!!

Real Estate Is Not a Spectator Sport

Case in point: You don’t find deals, you create them. He didn’t find that deal, he CREATED IT. Everyone had access to that deal…. And the world passed on it. It wasn’t a deal when it was on the market but it became one when we got into escrow. Plenty of buyers kept asking if we can deliver units vacant, and without being in escrow the sellers would always say no. It wasn’t until someone put skin in the game that they were more flexible. Which is why I said in the beginning, Real Estate is not a spectator sport… the perfect deal won’t fall on your lap by sitting on the sidelines. You gotta put properties in escrow and do the work. Its not sexy and it takes a lot of time – but its worth it.

My client always jokes with me now by saying:

‍“Was this a better investment than bitcoin or nah?” 😂