Dean Dretske » Residential http://deandretske.com Intersection of Software Development, Internet Marketing and Real Estate Investing, Martial Arts, and all of my other interests! Sat, 05 May 2012 22:30:09 +0000 en hourly 1 http://wordpress.org/?v=3.3.2 New Active Property http://deandretske.com/new-active-property http://deandretske.com/new-active-property#comments Tue, 20 Jul 2010 19:13:10 +0000 Dean Dretske http://deandretske.com/?p=421

The ‘Active Properties’ page of Real Estate For Fun And Profit was updated with a new hot REO that was listed in my office. Here is a brief walk thru that I did yesterday:

Click here to get more information about this property.

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]]> http://deandretske.com/new-active-property/feed 0 D3TV – Reluctant Negotiating http://deandretske.com/d3tv-reluctant-negotiating http://deandretske.com/d3tv-reluctant-negotiating#comments Wed, 30 Jun 2010 19:30:39 +0000 Dean Dretske http://deandretske.com/?p=413

Negotiating as the more reluctant party is a powerful strategy for getting what you want.

As real estate investors, it is easy to be chasing the other party.  They are reluctant and this puts us to a disadvantage.

I talk to a lot of people who want to sell their houses.  Some of them are motivated to sell and some are curious about what they can get.  I only have so much time and money available, so I need to focus my efforts on those that are truly motivated.

I realize now that putting myself in the reluctant position is way to filter out the simply curious.  If I take a moment in our conversation to explain a bit about my business model and then ask the seller how their house will fit in that model, then the sellers filter themselves.  The motivated will work with me to make it work.  The curious will not play.

In my case, I buy houses to rehab/flip or rent.  I explain to the seller that I can’t buy at retail prices – I need to fix the house and then sell it and still make money.  I also tell them that if I have to give them cash up front, then my costs are higher and I will not be able to pay them as much.  I can pay more if I get to make payments over time – either seller financing or delayed payment.  Then I ask them how they can adjust to make this work for both of us.

They need to convince me.  The simply curious do not care about any of this.  They just want their price or they want me to just make an offer.  The motivated understand that solving their problem is going to require them to work with me to come up with a solution.

Have you had a similar experience?

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]]> http://deandretske.com/d3tv-reluctant-negotiating/feed 0 Updated Properties http://deandretske.com/updated-properties http://deandretske.com/updated-properties#comments Tue, 22 Jun 2010 23:23:15 +0000 Dean Dretske http://deandretske.com/?p=405

Just wanted to let you know that the active properties page over at RealEstateForFunAndProfit.com got updated. There are some great deals there!

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]]> http://deandretske.com/updated-properties/feed 0 D3TV – Can We Help These Sellers? http://deandretske.com/d3tv-can-we-help-these-sellers http://deandretske.com/d3tv-can-we-help-these-sellers#comments Fri, 14 May 2010 17:31:27 +0000 Dean Dretske http://deandretske.com/?p=394


Case studies of 2 sellers who are motivated to sell their houses. Can we help them out?

The second case that I talk about is a seller who bought a house to rehab it 2 years ago. She has not done any of the work and now needs to sell since she is going to move to another town. The problem is that there is not much margin in the deal.

In the past, I did not have enough lead generation working for my business. When you have few leads, it is easy to get fixated on deals that are difficult and not very profitable. The key is to focus on lead generation so that you see more situations and can find the better deals.

Anybody else have this problem?

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]]> http://deandretske.com/d3tv-can-we-help-these-sellers/feed 2 Tulsa House For Sale – 3 Bed – 1 Bath – 1 car garage http://deandretske.com/tulsa-house-for-sale-3-bed-1-bath-1-car-garage http://deandretske.com/tulsa-house-for-sale-3-bed-1-bath-1-car-garage#comments Tue, 26 Jan 2010 07:44:25 +0000 Dean Dretske http://deandretske.com/?p=291

Enjoy the comfort and affordability of this home with casual living room, inside laundry, inviting kitchen with refrigerator, breakfast area, electric range, new carpet and interior paint, updated bathroom, and new roof in April 2009. Single car garage with nice deck on back. Good sized fenced yard.

Highly motivated seller – wants quick closing. Great starter house. Rent ready.

Click Here to Find Out More!

]]> http://deandretske.com/tulsa-house-for-sale-3-bed-1-bath-1-car-garage/feed 0 Parable of the Chrome-Plated Printing Press http://deandretske.com/parable-of-the-chrome-plated-printing-press http://deandretske.com/parable-of-the-chrome-plated-printing-press#comments Sat, 17 Oct 2009 08:02:55 +0000 Dean Dretske http://deandretske.com/?p=285

There once was a kindly seller who wanted to sell his nice printing press.  The printing press was chrome plated and everything, so it must be worth a LOT – let’s say $1,000,000 (why am I picking my teeth with my pinky :>). 

One day, a cold hearted buyer came around and offered the kindly seller a measly $500,000.  Oh, the insult!  The outrage!  The seller stomped his foot and rejected the offer.  He even refused to talk to that buyer ever again.

When the buyer walked away, he was asked by the seller’s neighbor why he would insult the seller so.  The buyer replied that although the printing press was very pretty, if he was going to spend $1M, he would rather buy the printing press in the next town.  After all, that printing press could print twice as fast.

Okay, as a parable, it stinks.  As a lesson in real estate, it is spot on.  Let me explain in two arenas.

1. Residential real estate.  Many agents can tell you that they have lived with this parable when they try to get a listing (or a price reduction).  The market is loudly saying that the price of the house is X, but the seller wants more.  Often for the reasons that they just spent $30K on new furniture, or their bold paint colors were the height of fashion 5 years ago, or they need $50K in profit so that they can buy a new car.  None of these things matter to a buyer who can find another similar house for less.  So what that it is ‘chrome plated’ – why is that a benefit to the buyer and why would they pay more for that?

2. Commercial real estate.  In many ways, commercial real estate is just like a printing press.  The buyer is looking to buy a cash flow that will take no more work than a similar investment.  Sellers in the commercial arena often talk about potential rents or ability to expand as reasons to pay them more for their properties.  Why is the buyer going to pay the seller for work that the buyer will need to perform?  If the buyer needs to raise the rents, and suffer the turnover that may happen, then why should the seller get more money?  Likewise, if the buyer is going to have to build new buildings to expand, or change the zoning to allow expansion, then why should the seller receive more money?  This would only make sense if this property is unique in its ability to expand or receive more rent.  How often is that the case?

Say you have the ability to pay up to $1M for a commercial property.  You look around and find 2 that appeal to you.  One of these properties has a cash flow of $10,000 per month and the other property has a cash flow of $5000.  Which one would you buy?  If the second property owner told you that you could increase the rents or that there is room to expand the buildings (you will need to spend more money to do this) and that you should be able to get the cash flow up to the $10,000/month range, then would you change your mind about which one to buy?

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