Communicating Value

[Douglas Vogel]

Hello everyone. I am in real estate and enjoy adding value to people’s lives improving where they live and spend their free time. I believe a lot of the time the value I add to my tenants and buyers is somewhat self evident based on condition of the property, marketing messages etc.

One thing I tend to struggle with more is communicating the value I add to sellers by problem solving. A lot of sellers are hesitant to give their reason “why” for selling in fear of opening themselves up to negotiation. I’m curious how others communicate value to sellers in order to acquire properties and thus add even more value to more people. How do you get sellers talking to you and how do you communicate your perceived value to them?

 

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[SteveO]

Do you mean how to convince someone to sell to you? Convey that in your offer or subsequent counters. If there are agents involved, you will not likely have a direct path of communication. I like to figure out the motivations in order to use it to my advantage. So, yeah, both sides are usually better off holding their cards out of view of the other side.

 

[SteveO]

There are a number of investors that look for distressed situations. In some of those cases the owners are facing the reality of losing their properties. A buyer that has resources and knowledge of the process can frequently help in these situations if they can figure out how to get the sellers something.

I have lease/optioned apartment buildings in the past. These were losing money. I took them over with a contract and assumed the liability of the negative income. But, got the gains in value after turning them around. The seller had to be convinced in my ability or the project could end up in foreclosure with the seller on the hook. I had to give them some cash up front which is what they were looking for from the start. I was in direct negotiation with the seller from the start. He realized that a buyer would not be able to get financing with the operating numbers at the time.

 

[Douglas Vogel]

Do you mean how to convince someone to sell to you? Convey that in your offer or subsequent counters. If there are agents involved, you will not likely have a direct path of communication. I like to figure out the motivations in order to use it to my advantage. So, yeah, both sides are usually better off holding their cards out of view of the other side.

Yes to sell to me. I use agents in order to free my time but definitely at a cost. Looking for ways to actively show I can add value by giving cash, getting the seller out of the property due to their life circumstances. Everyone has a reason to sell or buy, some more strongly than others but it’s difficult to convey without alienation or the feeling like someone is taking advantage of the other.

 

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[SteveO]

Yes to sell to me. I use agents in order to free my time but definitely at a cost. Looking for ways to actively show I can add value by giving cash, getting the seller out of the property due to their life circumstances. Everyone has a reason to sell or buy, some more strongly than others but it’s difficult to convey without alienation or the feeling like someone is taking advantage of the other.

What you are talking about is the foreclosure process or the challenge of locating long term owners of dilapidated houses. These are time consuming and challenging processes. Going into someone's home to convince them that you are there to help is difficult but doable. There are plenty of books written on this topic. And yeah, the majority of the world is going to view you as someone taking advantage of the situation. People losing their homes don't always see the reality of what it happening. If you can quickly assess, communicate, and put the resources into place, there may be a win-win. But, you will always be fighting perception.