5 ways to buy a property below market value (BMV) by finding motivated sellers
One of the areas we covered was finding motivated sellers, you can buy a property below market value , using this idea.
In a recent blog, we answered the question: What is a BMV deal and does it really exist?
Motivated sellers are people who are looking to sell quickly and, if needed, below market value. So, how do you find them?
The key for you to buy a property below market value is to understand the different types of situations that a vendor may find themselves in. By understanding their unique set of circumstances, you can look to solve their problem (such as getting a quick, cash sale) and, hopefully, get a BMV deal in the process. Here’s how …
Offer speed / creative solutions
There could be many reasons why someone needs a speedy house sale, for example:
- people in debt who need money quickly. (Figures from The Money Charity highlight a 14.3% increase in debt enquiries handled by Citizens Advice in September 2019 in England and Wales, compared with the same period in 2018.
- a vendor’s chain has broken, but they still want to proceed – so you can step in and buy the property. (Recent figures revealed that 29% of house sales between July 2018 and July 2019 fell through).
No capital for repairs or new infrastructure – so they can’t extend or improve
Other vendors who may be willing to accept a BMV deal could perhaps be those whose property is in dire need or repair, or where they need more space, (recent HMO regulations have constrained some landlords by not allowing them to rent too small rooms) but these Landlords don’t have the capital to extend or improve.
Where a couple are going through a divorce, they may want to sell the marital home as soon as possible – so that they can both move on and start again.
Similarly, someone who has inherited a probate property may want to make a quick sale as the house may hold sad memories.
Even Landlords can have had a bad experience with a tenant and may have lots of emotional tension around their investments.
An existing landlord with no capital to refurbish
In some cases, an existing landlord may have no capital to refurbish. This gets them into the position of only being able to get low-quality tenants and low rents. Or, they may have problem tenants or long voids.
By taking the property off of them, you are solving the landlord’s problem.
Landlords leaving the buy to let (BTL) market
An existing landlord may be looking for a quick sale due to perhaps ill-health; downsizing their portfolio; or, retiring.
A quick cash sale, with no chain, enables them to quickly move the property on – something they may consider selling at below market value for.
Finding motivated sellers
We hope this has given you some ideas of who a motivated seller may be. Talk to people in your property network, talk to estate agents and, do leaflet drops and local advertising to locate those vendors who have a property sale problem that you can solve.
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