Hi everyone, this may be a stupid question and people may have asked it before, but is there such a service that spots good value properties on a commission basis?
I am just starting out and having difficulty spotting good value investments in the market, so I thought the services of such a person could be quite valuable.
Regards,
Kristoffer Sheather.Hi Kristoffer,
Yes, there are bird-doggers out there – people who go out and search for properties, and pass some (or all) of these properties on to other people for a fee. This is often called ‘flipping’, but various regulations and law changes have made it more and more difficult to do.
There is also a type of Real Estate agent which can do this for you. They’re called “Buyers Agents”, and if you tell them what you’re after, they go out and look for it. If they find something which you then go on to buy, you pay them a commission.
However, you need to define what you’re after beforehand. “Good Value Investments” is too broad as a criteria. Are you after something which will appreciate in value soon, and will make a good short term deal? Or are you after long-term capital growth? Is a high rental yield a sign of a good value property?
I would recommend that before you consider any deals, look at your investing plan, and consider what due-diligence needs to be taken in order to ensure you get the best deal out there for you.
I hope this helps.
Brent
Brent, I agree and I will specify my parameters:
– 2 & 3 bedroom properties only
– value under 120k
– regional area with low unemployment level
– high rental / value ratioI’m thinking along the lines of lease option or wrapping, so cash flow is more important than capital gain, long term capital growth would be a bonus.
Sounds like you’ve got yourself a plan. What’s your next step? To find a region which fits your criteria, then look for a good buyers agent in the area?
Take action and go for it!You might consider grabbing a copy of Fast-Track. It talks about how Steve McKnight and David Bradley chose their niche area, and began investing.
One thing which only occurred to me a couple of months ago was that when you wrap a property, you are essentially guaranteeing yourself a capital gain.
When most people put a wrap together, they set a price for the purchaser which is higher than the price which they paid for the property. In essence, they are locking in the capital gains for the duration of the deal.
So who says you can’t get capital gains and positive cashflow? [
]I hope this has helped you in some way.
Brent
Hi Kristoffer,
this is an idea that I’ve been tossing over for some time.
While I’m not in a position to buy many properties at present, I am spending heaps of time out researching different areas, to gain a feel for those areas, and an appreciation of whats good or poor value in that market.
This will mean that come time to buy I’m fully prepared. However in the short term this is a costly process.
It would be of immense help to me if I could pass on some of the properties that I view(I look at 20+ most weekends)for a small commission or a spotters fee of some sort.
My main hesitation has been the legality of doing this as I’m not sure if it’s legal without a real estate license.
So if you or anyone else for that matter is interested, feel free to email at [email protected] to disscuss it further. I’m sure we can work something out.Regards,
Scott S“Aim for the stars and you’ll shoot the top of the telegraph pole. Aim for the top of the telegraph pole and you’ll shoot yourself in the foot!”
-anonScott,
Sounds like a great way to start out if you have the time available. I wish I did but as a contractor im quite often at work 7 days a week
Thus my idea of getting someone else to do some of the legwork for me. On another point if anyone knows the number for a good accountant and lawyer who is familiar with lease option and wrap contracts I would be thankfull if you could forward them to me in private
Regards,
Kristoffer Sheather.richmastery.com
are deal spotters. They charge 3-5 k. Mainly in NZ. though fully legit. They run seminars, as well as publish (or are somehow involved with) the excellent Kiwi Property Investor magazine.
I know someone (my buddy from last year’s property masters) that purchased a property from them.
I think they tie up the house and flip it.cheers-
MiniHi
I think people will have to be a bit wary of Richmastery and how they ‘value up’ their properties especially in NZ.
They use something called ‘Independent Market Valuation’ as opposed to the normal and accepted ‘Registered Valuation’
Note the ‘Independent’ in bold and italics… Enough said
Best to do extensive research before any purchase.
Cheers
David U
re: richmastery, one of the properties they’d tied up recently and were offering as a deal (for 2-3 K I think finder’s fee) was in NZ in a place called Putaruru. It was a unit, maybe a one-bedroom, but one of those low maintenance ones rented for somewhere around $100 per week. I think they had tied it up for $23K. I mean – it seemed like a good deal to me and it was one of the lowest-priced properties they had for sale. Then i had a squiz and managed to find it (or, an identical one) on realenz.co.nz.
I emailed the RE agent and enquired about the property. they said it was currently under offer. I told them to let me know if the deal fell over.So perhaps richmastery are legitimately finding cashflow positive properties, negotiating to buy them for a good price (? it seems?) and passing them on – so that even plus 2 or 3 K (I think they charge 5K finder’s fee if it’s a more expensive property) it’s still a good deal for someone with no time to look. However they don’t necessarily do all the due diligence for you i.e LIM report, builder’s report.
What I am trying to say here is that I think they really valid/legit.
it might be worth checking out what they consider to be good deals, by looking on their site
http://www.richmastery.co.nzeven if you don’t need a buyer’s agent, just to make you feel like you can find deals as good as theirs on your own.
cheers-
Mini.Hi Barbara
I have no doubt that Richmastery offers ‘good’ deals that are cashflow positive; but then again you and I know that we can find CF + properties in NZ ALL DAY LONG. It’s not difficult.
My issue is with the valuation of the properties. They refer to their valuation as ‘Independent’ rather than Registered and there is a VERY good reason for this.
When you have valuers on your team that will provide a valuation that you (The purchaser) requests; there must be some question regarding what is really independence and what is not.
My 2 cents
David U
Hi David,
I agree with them but the reason I stood up for them is the original question was to find a buyer’s agent, and i think they would be a good option for NZ property because you can look what they have with no obligation. Re: valuation, I realise it is a very grey area, the thing you can check though to make sure the deal is a good one is the ration of GV to actual purchase price in each area. Some areas sell on GV, others below, others above. I have been buying in areas that sell either on GV or 10 – 20 percent below. So you know that if they have tied a deal up for 30 percent below GV in a 20 percent below area you probably will end up ahead even after the commission.
cheers-
MiniHi Barb
I agree too… As a buyers agent, they are a good alternative for those with limited time…
Just need to make sure all other bases are covered
Cheers
David U
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