3-Step Playbook to Land More Real Estate Investing Deals
Real estate investing is an effective strategy for building financial freedom. However, many find themselves facing challenges when searching for market deals that yield the desired cash flow. This guide is specifically designed for those interested in real estate investing but struggling to find 'good' deals.
David Lecko's Journey in Real Estate Investment
Since 2017, David Lecko, CEO of DealMachine, has navigated the complex world of real estate investment. Driven by the ambition to directly benefit from his hard work, Lecko was inspired by both his investor boss and the influential book "Rich Dad, Poor Dad". He set a personal goal: to own approximately 15 rental properties to secure an annual retirement income of $70,000 to $100,000, post-expenses.
However, Lecko encountered a common obstacle. While researching properties in Indianapolis on Zillow, he realized that the costs associated with these properties – including mortgage taxes and insurance – were often higher than potential rental income.
This challenge led him to a pivotal realization at a local investors' meetup: the effectiveness of driving for dollars. This approach involves seeking rundown properties and contacting owners directly, often finding those willing to sell at a discount due to urgent financial needs or an unwillingness to invest in repairs.
Innovation and Strategic Development
Capitalizing on this strategy, Lecko developed an application that made it easier to identify property owners and initiate contact through direct mail. This innovation laid the foundation for DealMachine, which has since facilitated over 10,000 deals across 50 US states.
David Lecko's 3-Step Playbook
Drawing from his experiences and the success of others using DealMachine, Lecko formulated a three-step playbook for real estate investing success:
- Finding the Right Leads: Key to this step is the focus on rundown properties, high equity listings, expired listings, or tax delinquencies. The goal is to pinpoint motivated sellers rather than just any property listing.
- Consistent Marketing: Persistence in marketing is crucial. Data shows that about 46% of property owners respond by the third postcard. Maintaining regular communication channels is vital.
- Closing the Deal: For beginners, finalizing deals can be challenging. Lecko's strategy involves analyzing recently sold properties in the vicinity to determine the average price per square foot, which helps in estimating the after-repair value of a property.
Lecko stresses that the key to success in real estate investing lies in taking decisive action and learning from each experience. He advises against falling into 'analysis paralysis' and encourages continuous forward movement. For those seeking further guidance, the DealMachine Masterclass, recommended by Lecko, offers expert advice and detailed steps to navigate through complex investment scenarios.
This 3-step playbook is designed to assist investors in uncovering valuable off-market deals, paving the way for success and financial independence in real estate investing.
About Benjy Nichols
Benjy has been a media specialist at DealMachine for the last 2.5 years. He produces, writes, shoots, and edits our media content for our member's DealMachine and Real Estate education.