We’ve been searching for a property to flip for several months, consistently doing viewings and putting in offers. But, our offers are always rejected.
We’ve done our due diligence so know what our maximum is to make a decent profit. We follow up properties that we’ve offered on and have broadened our area with no luck.
How do we get vendors to accept our offers? We viewed over 50 and made offers on many without having any of them accepted by the vendor. Any help/advice is gratefully received.
You are doing nothing wrong and plenty right, but an understanding of human behaviour will enable you to get a better perspective. It’s human nature to over-value what you own already and under-value what you seek to own.
Whilst your calculation of what you need to pay for a property is probably accurate, it is not matching seller’s expectation of the sale price that they can achieve.
If your offers were being readily accepted, there would be something wrong, because it would mean that you were offering too much for the property. So rejected offers aren’t necessarily a bad sign.
Recently marketed properties will have a significantly reduced chance of a below asking price offer being accepted.
The essence of acquiring a property at an acceptable price needs you to be as patient as a cat stalking its prey. You simply have to let vendors become gradually acclimatised to the price the market will pay for a property - there is no short cut to this, you have to let each vendor work this out for themselves.
For some vendors, this will exceed the gestation period of an elephant (nearly two years!)
Learn from those who have mastered the art of patience in stalking vendors until they get an acceptable price. Learn or observe how long they will wait to obtain a desired property at a desired price – months, certainly, and years in some cases.
Patience and persistence are your friends.
The patience to wait, serenely, whilst the vendors gain understanding of what they can reasonably expect to sell the property for becomes more closely aligned to the offer they rejected from you.
The persistence to doggedly follow up regularly to see if any other buyer offering in excess of your rejected offer appears.
A property is only worth what someone is willing to pay for it. If no other buyer shows up and completes at a price higher than your maximum offer, then - eventually - your rejected, but still 'on the table', offer will become less and less unpalatable to the vendor with the passage of time - until the point where there natural decision is to accept what they previously declined to accept.
The only thing to add to what you are doing is a robust system to follow up each and every offer made until one of only two possible outcomes occur.
You will lose out on some properties and it is natural that you do so. Other buyers will have different motivations. They may want to live in it themselves and have no need to make a profit. They may just not have calculated the true value as accurately as you have and end up making little or no profit from the deal.
Maybe expand your property search to include so-called ‘unmortgageable’ properties, which will reduce the competition and these are often available well below marketing value.
Stick with it and wait for the rewards that will eventually be yours.