Getting a good deal

How do you get a good deal in buying a property?
It's through buying from sellers who are really keen to sell their home - i.e. a "motivated" seller. This is where you really ask for higher "discount" or making a "lowball" offer to purchase from the seller.

Who are motivated sellers?

1. They are people who are moving jobs and are moving to a different area and really needs to complete the sale as fast as possible.

2. This is pretty common - you will find sellers who can't afford to make payments to the bank any longer and the longer they wait, they run risk of the bank foreclosing and auctioning their home.

3. At most times too, you will find sellers who are moving up - to a bigger house - or maybe to a better area.  And they don't want to hold on to the property any longer - this is a low motivating factor. But if the seller has just contracted to buy his/her new house and is short on finances and he/she has to close that deal fast - they might sell it to you for a bargain especially when they need that down-payment from you to pay for their own down-payment!

4. The seller has just lost his job and really needs to tighten his budget or raise cash quickly.

5. Many a times too, you will find bargains from sellers who has just gone through a divorce. The seller is in no mood to hold any longer the property which use to be his/her matrimonial home. He/she wants to sell the property quickly and split the cash to go on with their lives!

Buy and then sell for a quick profit

Buying your property and quickly selling it during a boom period is a good way of making a decent cash profit which you can use to provide you with an income source. Or you can use that cash to make a down payment for another property. Not all properties that you buy will be good for a quick sale. The strategy for making money from property is a combination of holding, renting out and then selling for a profit. If you buy, say a RM200,000 property and then selling for just a RM10,000 gain after holding for a year - then that's not the property you want to buy to make a quick sale - you are probably better off renting it out and sell it much  later for a higher profit.

Tips to make money from property: Location (you already know this right?)

If you look for property such as houses to invest in, look for those in good neighbourhoods. If you buy property in the best neigbourhoods, where homes are at the top end of the market, it will be too expensive for you to able to rent it and cover your costs. Unless you want to quickly flip it in a hot market then you should buy in the best neigbourhood - provided you got it at a bargain! What constitutes a good neigbourhood? Look for homes that are uniform - if houses in these areas are hodgepodge - various schemes say mixed with low cost and medium costs or icky bungalows with bad individual designs- Avoid! If the areas is scattered with cars parked everywhere - and bad roads or narrow roads - Avoid these too. Find homes where there are nice and well maintained landscapes. Look for areas where there are good schools. If the area has poor schools then it's a poor neigbourhood.

Buy more to make more

I am sure you have seen your home increased if not shot up in value since the first time you moved into your home. And then you start thinking about the gain you are making on your home. But how do you make the profit when you are living in your home. You will need to find another place to live in order for you to sell and make a gain on your home. In most cases, people will buy another home that is more expensive to live in. The way to success in real estate is to buy a second, a third, maybe a fourth or maybe more homes. When you do that, you can then treat these additional purchases as true investments which you can either sell or rent.

Why Invest in Property?

For years, people with average income became rich by buying houses for rentals or selling them for a gain. Some have invested in landed properties and some have bought apartments. For some people, they also bought into commercial properties such as shop-offices and office units in office towers. In many occasions, their returns say over a 5 year period has exceeded that of investing in shares and unit trusts or similar investments plans. For these people, investing in properties has mostly been without any downside risks associated with investing in shares.

A lot of the time, when people invest in property they have no intention to become millionaires although I know a few of my friends becoming millionaires by doing so. As in my case, people invest in property because they want to pay for their childrens' university education, to have a comfortable savings in the future or just to maintain a cushy lifestyle. All these are achieved from the selling the properties that they own at a reasonable profit or getting monthly rentals from the properties they own.