Do you have your Realtor license?
Well, if you’ve listened to my podcasts or read my emails, you know that I often encourage investors to get licensed.
In my opinion, it’s well worth the time and cost. And, it helps you stay of trouble with the Board of Realtors, and gives you some accountability, which is important.
Okay, if you’ve been around me for a minute, you also know that I LOVE lease options. It’s my favorite strategy. 🙂
So, this is cool… there’s a guy who’s a Realtor doing lease-option sales here in my local area of St. Louis.
And let me just tell you—he’s crushing it in this niche. Has been for years.
He’s got this amazing system that’s simple but powerfully effective. And, he spends very little on advertising and/or marketing. It’s genius…
He advertises to find tenant-buyers on Facebook, Craigslist and does bandit signs… he interviews them, and then he goes and finds a house for them (he flips them a lease option deal).
Here’s the rub… you can’t do that unless you’re a licensed Realtor. That’s brokering, folks.
So one reason his advertising for tenant-buyers is so effective is because he includes a property in that ad.
Beware: Advertising a property that isn’t yours is illegal.
So, he simply reaches out to other agents and asks if he can advertise their properties. And the way he uses other agents’ properties in his tenant-buyer ads is simply saying that type of property is available as an option for the tenant-buyer—it may not be that exact property, but they can get into something similar…
Like I said, he’s barely spending any money on marketing and he’s finding a ton of tenant-buyers and deals. After he qualifies them, he sends them options of properties and tells them to choose a handful they like, and he makes an offer on it for them.
Look, tenant-buyers are everywhere!
There are tons of people who want to buy a house, but can’t due to credit issues. And there’s barely anyone offering these people houses anyway.
But, most have enough cash for a lease-option deposit and are about a year or two away from being able to get financing.
As far as I’m concerned, if your house is priced competitively, finding tenant-buyers is one of the easiest things to do.
In other words, if market rents are $1,200/mo. and you’re asking $1,400/mo. — you’re going to struggle. Don’t do that. Price it right.
So, how does this guys make money?
- He charges the tenant-buyer a little money upfront to apply for his program, which basically covers his expenses.
- He gets commission on the listing agent side from the seller upfront.
- When the tenant-buyer does get financing in a couple years, he gets the rest of his commission then.
I’m telling you… if you’re a licensed agent or are thinking about becoming one and you’re interested in doing lease options—get licensed and do this.
See, just like with wholesaling, the fastest way to do deals is by finding the buyers first. Stop trying to sell buyers what you have… find out what they want and go shopping for those properties.
Same for lease options—find the tenant-buyer first.
So, if you get licensed and use this lease option strategy, I foresee lots of terrific deals in your future.