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When I Start investing in real estate first. Property Research It’s the area where I wasted the most time.
Before I feel willing to send a quote, I think I have to know everything About property. The nuances of each partition, every easement, every possible red flag – I’m not shaken.
Now, it’s not a bad thing at all. But I eventually realized that my overly cautious approach made me back.
To run a profitable business, I have to get a quote and Close the transaction. However, every accepted offer costs dozens of quotes. In this volume, spending hours studying each property is unsustainable before an offer is made. Mathematics doesn’t work!
If I want to make progress, I have to change something.
The truth is, when you send a quote (like me) to a small part of the market value of each property, most people say “no”. This is how it works when you try to find a motivated seller – you throw away a lot of lines, but only a few will bite.
Related: How much should you provide for this property?
Speed up the due diligence process
Once I realized this, I knew I had to reduce fat from the research process.
I can’t spend an hour studying every property I encounter. If I hadn’t made a huge change, I wouldn’t be able to survive as a real estate investor.
After a lot of fine-tuning and experimentation, I reduced the research process to what I think is the most important factor. These are the basic information I need to know:
- Whether to make an offer
- How many are provided
The video below outlines this list of “Bare Essentials”, the list I followed when studying each attribute. (Tip: View this video in full screen to see all details.)
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Related: Are you using the best real estate data?
Want to use my property research spreadsheet?
If you are looking for a “Naked Essentials” due diligence worksheet, like the one I use, you can subscribe to the retimpter email list and download it for free here:
Achieve “good enough”
Now… is this process perfect? No.
But, does it tell the story and quickly get to the bottom of the most common questions, allowing me to send it out 10 times more discount therefore? Yes.
I felt comfortable collecting only basic information about nudes because I had a purchase contract which gave me a “back door”. In order to send dozens of quotes at the same time, no Locked in everyone, there must be a way to make a non-exchange offer (think of it as a “letter of intent”), while being very clear about this fact and getting the seller’s consent.
This allowed me to go further in the acquisition process No I have to spend countless hours investing my time before I make a reciprocal commitment to the sell direction. With this approach, I can make an offer on each property forward I know the last detail about it and put the rest together back I got every acceptance forward I finished the deal.
Consider the insights of Ken McElroy, author of Real Estate Investment ABC:
“Analytics are paralyzed. When I know 70% of everything, I keep trading. It takes too long and less risk.”
We don’t need perfection. We need enough information to present a reasonable education.
Related: All you have to do is 3 things you have to make an offer (easier than you think!)
Keep it simple
I wasted more time studying dead-end deals than time I wanted to admit. Many hours of my life have been lost by rabbit holes and red herring. What about now? I keep it simple.
This is my way: I won’t spend more than 15 minutes digging the property before making an offer.
If I can’t get the basics in that time window (preferably less) (market value, size, location, any obvious red flags), it’s not worth it.
Once accepted, I’m willing to go deeper, but they’re only worth my time when I see that I’m dealing with a property and someone who deals with me.
I’m not saying that this has to be your process. Maybe you like spreadsheets and due diligence marathons (if you do, God bless you!). But after years of every seller quote in the sunshine, I learned to protect my time like gold, Because it is!