What is it that we like to do every spring? Many people till up some ground, remove the weeds, add a little fertilizer, plant the seeds and wait for them to sprout and grow.
Real estate investing is like planting a garden. We find a good location and eliminate the properties that do not fit our plan. We locate properties that are promising and begin the process of assessment and negotiation .
I have found that creating what I call my “Real Estate Garden Book” helps me keep track of the properties I am watching or considering as I cultivate the deals just like cultivating sprouting seeds in a garden.
Here’s how it works.
Use a loose leaf notebook with tabbed dividers for your Garden Book. In it you will collect information on the property(s) you care considering. You will be removing and adding properties over time.
Determine the outcome for the property. Will it be a wholesale property, a buy, rehab and sell property, or a property that would be a rental? Create a Garden Book for each category of properties you are considering.
Snap a quick photo with a digital or camera phone . I download it to your computer and add the photo to a data page. MLS listings already have a photo and basic information on the listing sheet. So simply copy this sheet and include it in your book
For MLS listings, keep track of the list price, changes, if it goes off the market and why, number of days on the market, etc. Your agent should be able to assist you with information on the listing history of the property.
Include information on comps in the area. What are rental rates in the area? Ask your agent to assist you with these.
Look up the county records, copy the information and add it to the materials. This should give me the current owners address and basic information on the property.
Check with Code Enforcement for any outstanding violations.
Include a page to notes on the property from the initial observation and then from any conversations with the owner or agent and later from visits you may make to the property.
Give each property a rating. High, medium, low. Color code each rating with different color highlighters to designate each property.
Some of the properties will be purchased by other buyers or removed from the market by the owner. You will eventually weed out more of the properties in your book…and what will be remaining will be the cream of the crop.
What we are trying to accomplish is to find the best property with the most potential for creating a profit or long term return on our investment.