#22 Making The Low Ball Offer Without Feeling Embarrassed. I Will Show You How

In today’s episode of Property Sourcing Profits, David discusses making the lowball offer to secure your deals. How do you make a low ball offer without ruining the relationship you have with the estate agent? David gives you a helpful script that he uses in this type of situation.KEY TAKEAWAYS• Lowball Offer. This is a very powerful strategy. You need it in your criteria. How do you summon up the nerve to make a really low ball offer? What is the right number? What is the number that you can put forward in good faith maintain your relationship with the estate agent and serve your investor too so that you get paid. Gross Yield. This is a concept that everyone in property understands and should understand. The total gross rent roll. The total gross rental. No deductions. The gross rent that is achievable for that property. You divide the gross rent by the cost of the acquisition. So that's the cost of the property, the price that you pay and all the transactional costs associated with the purchase. Reverse Engineering. This is what David uses when he wants to make a low ball offer. Brexit. This is having an effect on the property market. This is not a political point. This is about real-world property stuff. There is a pause. Investors are holding back. There is uncertainty. They don’t know what is going to happen. But you can use this to your advantage in your negotiation. Remember that Brexit is your friend. Justify your offers. The important word in making a low ball offer is justification.  You got to be able to justify your offer. If you can justify your offer to yourself and to the estate agent, then there is no need to be embarrassed about it because you are a property professional. The estate agent knows you're going to be looking for a discount if you looking for a significant discount and all you got to do is justify it.BEST MOMENTS “Deal packaging. This is about people and arithmetic.” “You gotta try and get towards double-digit growth you 10%.” “I believe this with volition is that the most houses that you will see in the shop window will not achieve 100% the offer price. They won’t.”“They may accept it. They may not accept it. But here's the thing, you have justified the offer you have.” “Use every tool that you have available when speaking to estate agents to get the discount in the deal for your investors. The more you can say for your investor the more impressed they will be, the more professional they think you are. However, you can't just walk into the estate agent who you also need an existing relationship with and just make a low ball offer on top of lowball offer with no justification.”ABOUT THE HOSTDavid is a property expert with over 25 years’ experience and his own portfolio of 26 units. His current rent roll is in excess of £10k per month. He is also a partner in a Deal Sourcing and Packaging business in the North West of England and has sourced over 250 properties for investors since 2004.In recent years he has, by necessity, had to develop an expertise in LHA strategies. This area is increasingly becoming a niche for him and he enjoys empowering other landlords by sharing the knowledge he has gained.The ultimate purpose when sourcing properties in this sector for investors is to minimise risk while maximising profit. He has had to find answers to the challenges of Tenant Find, Management, ensuring rents are paid and the transition to Universal Credit. These are strategies he uses in his own business and also on behalf of investors. His investor clients regularly achieve annual gross yields of over 20% with high occupancy rates and voids resolved, sometimes within hours.CONTACT METHODDavid’s LinkedInDavid’s Facebook