When Ifirst started investing in real estate,property research was the area where I wasted the most time.
Before I felt comfortable sending out an offer, I thought I had to know everything about a property. Every zoning nuance, every easement, every possible red flag—I left no stone unturned.
Now, being thorough isn’t a bad thing. But I eventually realized that my overly cautious approach was holding me back.
To run a profitable business, I had to get offers accepted and close deals. But it took dozens of offers for every ONE that was accepted. At that volume, spending hours researching each property wasn’t sustainable before making an offer. The math didn’t work!
If I wanted to make progress, something had to change.
The truth is, when you send offers for a fraction of each property’s market value (like I do), most people will say “no.” That’s just how it works when you’re trying to find motivated sellers—you throw out a lot of lines, but only a few will bite.
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Speeding Up the Due Diligence Process
Once I realized this, I knew I had to cut the fat from my research process.
I couldn’t spend an hour researching every single property I came across. If I didn’t make drastic changes, I wouldn’t survive as a real estate investor.
After a lot of fine-tuning and experimentation, I whittled down my research process to what I considered the most important factors. These were the essential pieces of information that I needed to know to determine:
- Whether or not to make an offer
- How much to offer
The video below outlines this list of “bare essentials,” i.e., the checklist I followed in researching each property. (Hint: View this video in FULL SCREEN to see all the details.)
RELATED: Are You Using the Best Real Estate Data?
Want to Use My Property Research Spreadsheet?
If you’re looking for a “bare essentials” due diligence worksheet just like the one I use, you can subscribe to the REtipster email list and download it for free right here:
Getting to “Good Enough”
Now… is this process perfect? No.
But does it tell the story and get to the bottom of the most common issues quickly, allowing me to send out 10x more offers as a result? Yes.
I feel comfortable gathering only the bare essential information because I have a purchase contractthat gives me a “back door.” In order to send out dozens of offers simultaneously andnotbe locked into each one, there must be a way to make non-committal offers (think of it as more of a “letter of intent”),all while being very clear about this fact and getting the seller’s consent.
This has allowed me to get much further in my acquisition processwithout having to invest countless hours of my time before the seller makes a reciprocal commitment to me. With this approach, I can make offers on each property before I know every last detail about it and put together the remaining pieces after I’ve gotten each acceptance and before I close on the deal.
Consider this insight fromKen McElroy, author of The ABCs of Real Estate Investing:
“Analysis is paralysis. I move on a deal when I know 70% of everything. More than that takes too long and less is too risky.”
We don’t need perfection.We need just enough information to make a reasonably educated offer.
RELATED: The Only 3 Things You Need To Make An Offer (It’s Simpler Than You Think!)
Keeping It Simple
I’ve wasted more time researching dead-end deals than I care to admit. Many hours of my life were lost to rabbit holes and red herrings. So now? I keep it simple.
Here’s how I do it: I don’t spend more than 15 minutes digging into a property before I make an offer.
If I can’t get the basics in that window of time (and preferably less)—market value, size, location, any obvious red flags—then it’s not worth the time.
Once I get accepted, I’m willing to go deeper, but only when I can see I’m dealing with a property and a person who has shown me they are worth my time.
I’m not saying this has to be your process. Maybe you like spreadsheets and due diligence marathons (God bless you if you do!). But after years of making thousands of offers to every type of seller under the sun, I’ve learned to protect my time like it’s gold, because it is!
