Developing an Effective Real Estate Investor Buyer Database
If your real estate investment strategy involves resale of properties to other investors, you will be much more successful if you maintain a detailed property investor database. It is your customer file for flipping or selling properties to others in the business.
You'll want to have ready access to all types of data about potential buyers, and you'll need to keep it up to date. When you see an opportunity, don't let it evaporate or turn south on you because you can't find the right buyer.
It's Not Just About Contact Information
Of course, like any good Customer Relationship Management (CRM) database, you'll want to have complete contact information, including addresses, phone numbers, and email addresses. But you'll have greater success and higher profits if you also maintain more detailed information about each buyer.
What do they specialize in? Do they have a preferred property type or area of town? Basic financial capabilities are good to know, such as "always has cash," or "needs time to get funding." Always record your experience in deals with each buyer, as you will want to remember problems or positives in the future.
Building Your Database With Buyers From Advertising
By advertising, we're talking about both directions: your ads to find buyers as well as ads you locate saying things like "I buy houses." Keep up your efforts, always watching the newspapers for ads that can point you to a buyer. Give them a call and start a relationship. You don't need a property right then. You can tell them that you've just finished some deals, but you have some prospects out there.
Run classified ads to let investors know that you have investment properties for sale. When you get that first call, it can make a year of ads worth the cost.
Join Real Estate Investment Clubs
This approach is one of the most fruitful. After all, who are the members of your local real estate investment clubs? They're other real estate investors or people who want to be. You can build relationships quickly, and with those who are most likely to be your customers in the future. These people are actively engaged in real estate investment, and the club helps to educate them, as well as to bring you together. Some resources include the REI Club and CRE Online. There are more. Just do a Google search for "real estate investment clubs."
Setting up a Database
Which program is best for your property investor database? This one's up to you. A database program such as Microsoft Access works well, but it has a bit of a learning curve. You can also use a spreadsheet program like Microsoft Excel to create a simple database. Another option is purchasing CRM software, which may have features to help you follow up with potential buyers. By creating a database with a record for each buyer, and fields in that record for all of the data you want to maintain, you'll be able to locate the right buyer easily with a quick search.
Why Develop a Database?
It's just part of supply and demand. You will be locating properties to purchase, place under assignment, or just refer to other investors for a quick sale and profits. If your buyer database has 10 buyers in it, you'll be a lot less successful than if there are 100. By properly cataloging their interests, requirements, and funding ability, you'll have ready access to a very focused list of potential customers for your next property.
Diligently build and maintain your buyer database. The key is to match your property opportunities to buyers, usually even before you get involved. Nothing will give you greater confidence in the outcome of a deal than knowing you've found a deep discount property that will be in demand by multiple buyers in your database.