with Beau Beery
Target your time in attacking specific assets rather than randomly going after assets you think you like or waiting for deals to be brought to you.
In this video I’m going to teach you the sniper method of finding multi-family real estate
deals.
The sniper method is a database driven approach, that allows you to be far more efficient with your time in attacking assets rather than randomly going after assets you think you like or waiting for deals to be brought to you.
Now I’m not going to lie, this is going to seem easy because it's a short, but this method takes a tremendous amount of time and effort to initially set up, but I have found if it's easy everybody would be doing it.
Step number one.
You're going to visit every property tax assessor website and you're going to export every single multifamily complex in that market into an excel spreadsheet. Some tax assessor websites don't have the ability to export, so then you would call them directly and see if they can download those to excel and email them to you. If that doesn't work
then you're going to have to resolve subscribing and paying for third-party property database websites that have at least most of this information.
Once you have a nice clean spreadsheet with all of the column headings perfect and all of the information filled in for each of those categories, next you're going to import all that information all at one time, nice and easy, into a CRM.
What I want you to focus on is how powerful it is to create a targeted approach to go after targeted assets, so you can buy way more than everybody else.
Now that you've imported all the records you can see I’ve got 1920 properties that we've
imported let's pretend that we buy b-class student housing assets over 200 beds in the Tallahassee market. So we'll go into the ‘type’ query as ‘student’ we're going to drill down in the query and watch the 1920 go to 217 already.
Now we want to go into the classifications so we're going to put a B as we're going to want the B+plus and we're going to want the B- minus.
Now watch what happens to the 217… now we're down to 146. ,
Next we want to do this in the Tallahassee market only, so we're going to go into is Tallahassee. 146 becomes 75.
We said we wanted to buy over 200 beds, so we query greater than or equal to 200,
drill down 75 becomes 35, we're getting there.
Now, let's pretend that we like to buy assets that were built between 1980 and 2015. so we query is between 1980 and 2015 and now we're down to 29 assets and now let's target assets that haven't already sold in the last two years, because those properties are going to be more difficult to buy for a reasonable price.
If we go into the transaction date and we query: we want less than or equal to 1217- 2018, the drill down 29 becomes 25… but wait there's more! I like to go ahead and view that in a list form, which is right here and then I’m going to export this into excel to show you a couple more exercises that I do with the excel spreadsheet in order to further
narrow down the list.
You can see how this becomes very powerful. To be able to buy in this manner I’m going to show you the excel spreadsheet now and how I can further narrow down
to the exact assets I want to buy.
Here's the exported version showing all of the same categories we just went over including units, beds, when it last sold and what it sold for.
What I like to do next is eliminate those owners who I know just being in the business are not owners who typically look at off-market offers versus listing with a broker and exposing it to the market.
The easiest way to do that is to come into the owner column let's sort them alphabetically, so we have them all in order I know in my markets American campus communities.
The Collier companies and the Scion group are probably not going to do a deal directly with a buyer who calls them out of nowhere, so then when you eliminate that you're
down to 15 listings.
Remember the line one is the actual categories then you may create an additional column, that is the dollar per bed closing price and sort them and you may say to yourself: “I'm not looking at any deals that have closed in the past for more than 60 thousand dollars a bed”, if that's the case then you've deleted a few more, you may
drill down even further and create another column. That is the bed to unit ratio and you
may say: “I'm not buying anything that has a bedroom to unit ratio bigger than three because I like one bedroom and two bedrooms more for this market”
If that's the case, then you're coming across here and deleting all of these we've got only six properties left do you understand what just happened you took an entire northern half of a state and narrowed it down from 1,900 plus properties to only six properties.
That you could legitimately buy based on that specific criteria now realistically because I know my market so well I could further narrow down that list by eliminating those owners who own assets in long-term funds and that fund is not up yet for sale or
that own assets that have already been value added.
If I was hoping to add value to it, I know I used a pretty specific criteria in this exercise,
but the point is in almost all cases you can dramatically narrow down every asset in a market to a very small data set so that you can more effectively and efficiently focus your mind on those assets.
Now this approach takes a tremendous amount of upfront effort, and it requires a little
bit of work every day because keep in mind you've got to update when properties sell change hands to different owners contact information researching what those closing prices are sometimes unit numbers change.
If they're adding units or subtracting units and the list goes on using the sniper approach to find more deals is effective but let me tell you something very important that I hope you won't take as some cheap ploy to gain more business for myself the number one most effective way to find more deals than anyone else in your market is to develop a reputation that compels every broker in the market to bring you all of their listings.
First multi-family brokers procure over 90 of all closings over 10 units if you can become a magnet for every broker's listings and you master the sniper's approach to finding deals to buy game over for the competition.
Connect with Beau Beery at Website: https://www.beaubeery.com/
Comments