Traditional Property Investing and Creative Property Investing
Is creative property investing for you or should you go the traditional property investing route? You’ll discover the differences, the pros and the cons of both approaches and which one is right for you.
First let’s take a look at what each one looks like:
With traditional Property an investor…
- Buys investment properties on Rightmove
- Finds deals by calling up a real estate agent.
- Buys foreclosures that are listed on Rightmove.
- Buys foreclosures at the foreclosure auction sale.
- Buys properties from wholesalers.
- Gets into bidding wars with other buyers.
- Uses big earnest money checks to get properties under contract.
- Puts down big down payments.
- Applies for investor bank loans.
- Gives loan underwriters their proverbial first born child.
- Makes tons of offers to get a few accepted.
- Constantly looks at deals, on the web and in person.
- Negotiates deals based on price.
- Only looks for buy to let
With creative property, an investor…
- Finds deals by marketing for motivated sellers.
- Gets to the deals before anyone else knows about them.
- Has little or no competition.
- Works with sellers directly without agents involved in the purchase.
- Usually puts up very little earnest money (i.e. $10).
- Rarely needs down payments.
- Doesn’t fill out loan applications.
- Buys properties with owner financing.
- Takes over existing mortgages subject to.
- Makes several offers on the same property.
- Creates bidding wars when selling their deals to others.
- Turns every lead into money by assigning the bad ones to agents.
- Uses transactional funding, hard and private money.
- Rarely looks at properties unless to get it under contract.
- Negotiates deals based on terms, price or both.
- Invests in Professional HMOs and or Social Housing HMOs
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