In today’s blog, rent to rent expert Kevin McDonnell is answering common community questions on how to find and negotiate rent to rent deals.
Don’t think there are deals to be made in your areas? You’re looking at it all wrong!
Never assume that what a landlord or agent wants is all they will settle for, you have to keep pushing. Kevin will show you how he presents a deal to secure properties- and make a profit on them:
What if the numbers don’t work?
You are looking at the wrong numbers! Don’t think about what the landlords are asking for, think about what you can afford. Reverse engineer the process, I offer what works for me, not what the landlords are asking for. What a tenant pays is not what the landlord gets, so usually what you want to pay isn’t too far off what the landlord gets. Focus on what you want, not what the landlord wants
Learn how to structure your offer
Take fees that the landlord would otherwise pay off your offer, this will bring down how much they would usually receive by a big chunk, and all of a sudden the price looks like a much better deal.
Don’t make a good deal a bad one
Know when to walk away. Always stick to your offer, it’s a numbers game. It can be difficult when you become committed to a property, and you could be tempted to up your offer after seeing you are not far off what the landlord wants. But this could be a very bad move, and could wipe any profit away- what is the point of that?
How to negotiate creative finance with an estate agent
NEVER NEVER NEVER cut an agent out of a deal – but where possible start the negotiations without an agent. Try to go directly to the vendor where possible. Most agents are not professional investors – and they won’t understand what you are offering. You need to position the offer yourself, and show the landlord their pleasure and pain points.
There is only one chance to make a first impression with an offer, and it can lose you a deal if you don’t do it face to face. How do you know how the offer is being received? You can’t see someone’s face over email! Negotiating is a skill, and nothing can replace seeing your landlord face to face.
If an agent says no, always try to talk them around. You can show them how they can make more money by working with you. Did you know that even though agents can’t charge fees to tenants anymore, they can charge limited companies? This is a huge bonus for them- let them know they can use it!
And remember, houses are like buses, if you don’t get the one you want, another one will come along.
This post has been originally featured in Progressive Property