Real Estate Acquisition: Finding Apartments and Houses with Good Real Estate Returns
Real Estate Acquisition – Finding profitable real estate is your goal? For your very first real estate as an investment and maybe also for the second, third or fourth real estate as an investment. Finding real estate bargains, affordable apartments and cheap houses is not that easy. What you need above all is 1) a personal network and 2) the right tools.
Preparation for Real Estate Acquisition
Before you start actively acquiring real estate, you need to know which location and what type of property you want to buy.
Therefore, two questions are particularly central. First, 1) which location will you buy in and 2) what type of property will you buy?
Where to buy? Making a Location Decision
Fundamentally, your individual real estate criteria are always the basis for selection (here you can find the 11-step checklist). Some prefer newer properties in good locations, while others have good contacts with tradespeople and can buy cheaper properties, which then require work through renovation, repair and/or renovation. Both cases lead to an increase in value and rental price adjustment. As a result, the real estate yield, that is, what you “earn” with your property, increases.
Proximity to real estate ownership is always practical, for example within a radius of 80 kilometers. But also proximity to places where your family lives, where you are often professionally active, with a bit more distance.
Learn more about location choice here:
Which Property? Decision for an Investment
When buying real estate, you have the dilemma of choice without prior experience: Should you buy a single-family home, just a row house, or an apartment? In our guide “Types of Real Estate: Which to Buy,” we have already explained in detail that there is a type of real estate that has many advantages – condominiumapartments.
One of the major advantages of condominiums for your first investment is the maintenance costs, with which you, as a landlord, will eventually be confronted. Roof, attic, masonry, facade, heating, what does maintenance cost over the years? You are also among the risks when buying real estate. As a homeowner, you are responsible for 100% of the costs! As an apartment owner, you are part of a homeowners’ association. As a result, you only pay costs proportionally.
Why and how, all criteria:
The first two, central questions should now be answered by you in order to start the real estate acquisition process.
Starting the acquisition: Realtor, network and portals
To find profitable real estate, you have many options: local real estate agents, a personal network, the various real estate portals, and also acquisition tools.
Options: Finding real estate with strategy
There is no single way, no one strategy that will quickly lead you to success. Take your time, even if you’re looking for real estate while working a job, because you will need time.
Real estate markets differ, as do the conditions. Some people have time to check real estate portals multiple times a day. Others have demanding jobs and are looking for their first property alongside their career.
You should cast a wide net and make use of the mix of possibilities.
Acquisition channels:
- Professional realtors
- Personal network
- Real estate portals
- Also eBay Kleinanzeigen
- Local newspapers (if you really have a lot of time)
Off-Market and On-Market
Have you ever heard of Off Market and On Market? Not all Real Estate can be found on Real Estate portals. Many Real Estate properties are sold before they officially go on the market.
Off-Market – When Real Estate is sold without becoming public (newspaper to Real Estate portal), it is referred to as “Off Market Real Estate”. The term “Off” itself comes from English and means “away”, “off” or “removed”.
Typical cases are Real Estate sold among friends, when one person knows that the other knows someone who knows someone who is currently looking to sell. Ideally, even quickly. In such a situation, you can make real Real Estate deals. Or even more directly, if a friend or neighbor asks you if you want to buy their property.
That’s why it’s also so important that you build your own personal network on-site, from which you may be able to acquire Real Estate under certain circumstances.
In addition to friends or also Realtors, an extreme example could also be a friend who is an attorney who is early on in divorces and separations.
On-Market – As soon as a Realtor becomes aware of a property and presents it to 3, 4 contacts, you can no longer speak of “Off Market”. From this point on, a property is “On Market”. With the commission of a Real Estate agent, advertisements on Real Estate portals, on eBay Kleinanzeigen or also in other media (apps, newspapers), the properties are in the publicly accessible Real Estate market.
Can you still make real deals here? You will often hear that you can no longer make “real deals” on Real Estate portals – is that true? More on that shortly!
To summarize once again:
Sales channels:
- Off-Market – Direct, no competition from buyers
- On-Market – Published (Newspaper to Online Portal)
Get to know a real estate agent
Before you come across real estate through a personal network “around the corner,” you should definitely speak to and get to know real estate agents in your area. If you build a good relationship with one or more real estate agents, you will receive some property offers in advance – before they are published on a real estate portal.
Therefore, a strategic measure should always involve getting to know real estate agents. After all, who do most real estate sellers contact first? Real estate agents.
On average, 72 % of all real estate is sold through agents (Source: Federal Statistical Office).
- Berlin with agent: 78.6 %
- Düsseldorf with a Realtor: 76.0 %
- Hamburg with a Realtor: 65.1 %
- Cologne with a Realtor: 63.0 %
- Stuttgart with a Realtor: 56.8 %
- Munich with a Realtor: 55.2 %
- Frankfurt with a Realtor: 53.3 %
Getting to know one or two Realtors personally is therefore so important. Just as important as expanding personal contacts.
Personal Network: Acquaintances and New Acquaintances
Simply put: If one or two people know that you are buying real estate, offers will probably be brought to your attention. If no one knows that you are buying real estate, no one will think of telling you about an offer!
So you make sure to expand your network and talk to people who might come into contact with properties for sale, sooner or later. As mentioned before, this could be a lawyer dealing with divorces. It could be a real estate appraiser, an architect, or even a tradesman who is constantly in private homes and knows before anyone else if a property might be in such a state of disrepair that it needs to be sold soon.
- You are buying real estate – people need to know this
- Tell friends, maybe they hear something
- Acquaintances – From the explicit divorce lawyer to the tradesman
Real Estate Portals
Sometimes you’ll hear that all “good real estate” doesn’t end up on real estate portals. That’s not entirely true, because maybe the realtor doesn’t have the right clients to sell them in his own network.
But sometimes it’s also private individuals who post listings online. The photos are unflattering, the information about the property is incomplete. Upon closer inspection of a few listings, you might still find aspects that make them a profitable real estate investment.
Profitable real estate can therefore not only be found in personal networks, you could also find bargains and buy on real estate portals – but for that you need to invest 1) time and 2) be quick when you find a “bargain”! More on that shortly.
Photo: Dragan Grkic / Shutterstock
Regional Newspapers (if you really have a lot of time)
Local real estate agents, a personal network, the various real estate portals, and also acquisition tools – if you still find time among all these options, you can also use regional and local newspapers.
By the way, many newspapers now present their real estate offers online. A short Google search for local newspapers that also present real estate online is therefore worthwhile. Here, the competition is often somewhat lower than on the major real estate portals.
Tools for Real Estate Search
In the guide Buy real estate cheaply we also present 3 practical tools that allow you to compare current land prices in regions. The Future Atlas, Price Atlas, and Boris (standard land value information system).
Real Estate Search: Find and convince – Tips
On the way to profitable real estate, there is only one way: Stay involved. As soon as you find something good, it’s about speed and commitment, towards the realtor and/or seller directly.
Our 3 tips:
- Stay involved – find time and invest
- Commitment – convince the realtor/seller
- Financing confirmation and reservation agreement
Find a bargain? Portals and push notifications
Damit du Schnäppchen findest, solltest du also auch auf Portalen schauen, nicht nur auf das persönliche Netzwerk vertrauen. Lässt du dich von den Portalen 2x bis 5x täglich Push-Notifications senden (Benachrichtigung via E-Mail). Immer dann, wenn der Quadratmeterpreis stimmt, in Abhängigkeit zur Lage, telefonierst du mit dem Immobilienmakler oder Verkäufer und gibst direkt eine Reservierung ab.
Tipp zur Reservierungsvereinbarung: Gekauft wird, erst beim Notar.
Bei Immobilien und Lage mit hoher Nachfrage solltest du dich – für echte Schnäppchen – mehr als 2x am Tag benachrichtigen lassen. Das sind beispielsweise 1-Zimmer oder 2-Zimmer-Wohnungen unter 50 m² zum guten Quadratmeterpreis. Hier solltest du dich besser 10x am Tag benachrichtigen lassen. Die Konkurrenz ist hoch, das heißt für dich viele Anrufe, denn alle wollen kaufen, oft auch ohne Besichtigung!
Wenn du gute Handwerker Kontakte hast und gegebenenfalls auch nach sanierungsbedürftigen Wohnungen oder auch Mehrfamilienhäusern suchst, genügt es, 2x am Tag benachrichtigt zu werden.
Wichtig ist, bring Zeit mit.
Viele suchen, viele steigen aus. Nutzt du die Zeit für 1) Netzwerkaufbau und 2) Marktkenntnisse.
Geschwindigkeit und Verbindlichkeit im Kaufprozess
At the latest, when a good offer goes online, the race of buyers on site begins. As mentioned earlier, finding and buying a bargain means you must 1) invest time and 2) be quick when you find a “bargain”!
Speed is very important
And
Commitment is very important.
Tip! Financing confirmation and reservation agreement
Ideally, as soon as you discover the listing, you pick up the phone and call the seller, whether private or a realtor. The more committed you appear from this moment on, the better. Ideally, you already have a financing confirmation from your bank for an amount of X – what could be better for the seller than direct proof of capital?
This is followed by the viewing. Tip! If you feel that based on the numbers and facts from the listing you have a real real estate bargain in front of you, you make a reservation agreement directly with the realtor.
Photo: Freedomz / Shutterstock.com
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