As a full time Canadian real estate investor, we must create a flow of deals that make continuous income for us. Many average real estate investors can be subject to great lulls of time where they are between deals and a result are not getting paid.
We must be cognizant of the fact that as much as we like flips for quick cash, the way to create real wealth is through building a portfolio of properties that pay us regularly. If you think about the people that get mega rich in real estate, most of them have significant holdings that build equity and produce passive income. Therefore, it is vital to create a business for ourselves to get paid in the same manner.
How do we find a continuous flow of deals?
One way is by creating a bird dog network.
A bird dog in real estate is someone who finds the deals and brings them to you and they get paid for their efforts when you close. Each bird dog creates their own network to find deals and other investors ( another article) and uses that network to bring you, the deal maker, a deal. At this point you do an analysis of the deal and if you like it you notify your network to get the deal done. (that’s another article as well) Here’s the thing; you need a relatively regular influx of deals so you need more than one bird dog for your supply. So, we have to train our bird dogs and duplicate their efforts…breeding if you will.
How do we breed our bird dogs?
1) Referral Fees – When we close a deal and have made money on the deal that our bird dog has brought us , we will with pay them $500, $1000, $5000 or perhaps 1% of the deal. If we have made $ 25,000 because of them, why not. If you don’t share your successes/money in this business, my opinion is that you will have less [success].
So if your bird dog is getting paid, don’t you think they may tell a few people that this guy (you) actually follows through and pays his bird dog fees? Of course. Now you can make it even more interesting for your original bird dog.
Your bird dog can enlist his own bird dogs under them kind of like a multi level marketing idea. So if any of the bird dogs finds a deal it goes through the original bird dog and they both get paid a portion of the fee. So you’ve created a two tier system which results in more bird dogs finding you property.
2) Service environments – as an example, if you are in a restaurant, and you say to a waitress “I have a business that pays handsome referral fees to people that can bring me good deals… If you know anybody that is in a situation that needs to sell the property quickly, I can help them, and I will pay you as a result. Further, if any other waitresses or restaurant worker in this establishment may be interested in the same opportunity give them my card. If I get referred a deal from someone else that you have given my card to, you will also get paid.” The beauty of this is…as soon as this happens successfully once, word will spread, and more deals will come to you.
3) Utility/mobile service people – any worker that is involve in serving the public and is out in neighbourhoods on a regular basis can become your bird dog. These folks are the ones that may see a property with the signs of distress or are cutting off electricity or delivering notices etc. Make friends with these people and add them to your network. More eyes out there on your behalf means more deals!
If you would like more information
email me at [email protected]
Three Ways to Breed a Bird Dog