Deal sourcing has rapidly become of the most lucrative property strategies in the UK. What is sourcing?
Sourcing is finding good deals and passing them on to investors for a fee. You will need to present key information along with the deal such as what the rental income will be. Proving to the investor that you have done all of your due diligence not only on the property but also the area.
The fees you can expect to get due to sourcing can range between £2K to £5K per deal. So sourcing one deal a month will be enough to cover a month’s salary of a regular 9-5 job.
When sourcing you will need to follow a few guidelines. Samuel has outlined a few important ones following these will help you get started on your sourcing journey and you maximize your investments.
Finding good Deals: In order to be a success, you need to be able to find good deals. As this will have a huge influence on the number of investors you are able to attract.
Investors: Once you’ve done your due diligence and have your deals set up. You will need someone to sell them too. Building your Investors list can be done at various PIN events, training events, and social media. Let people that you’re a sourcer and looking to make deals.
Compliant: Due to the amount of money that can be made through sourcing. There are many rules and regulations that have been laid out to prevent people from losing money by being sold bad deals. You will need indemnity insurance, have a limited company set up, a business account. Finally, you will need to be registered with the redress ombudsman scheme.
Good reputation: Sometimes all it will take is one person to give you a glowing recommendation. In property, this can go along way and can result in repeat business. A lot of deal sourcer’s tend to sell properties to the same people as they have earned built up a great rapport with them and are trusted.