If you want to dive into the property investing, becoming a property sourcing agent can be a profitable segway.
As an intermediary between property sellers and investors, your role revolves around identifying and securing profitable property deals. Whether you're an industry novice or an experienced player, finding those golden opportunities is the key to success in property sourcing.
In this article, we'll guide you through a whopping 13 strategies to source valuable property deals that cater to the diverse needs of your investor clients (or any investor for that matter!).
As a reputable property sourcer, your mission is clear: discover properties that align with your clients' objectives, negotiate favourable terms, and facilitate the acquisition process.
Let's explore the tactics that will set you on the path to becoming a sought-after property sourcer.
1. Master your local property market knowledge
To excel in property sourcing, your knowledge of the local market is your greatest asset.
Understand the dynamics of your target area, from property values and rental rates to emerging trends.
Invest your time in scouting neighbourhoods, attending local property auctions, and engaging with real estate professionals.
The better you know your market, the more efficiently you can pinpoint promising opportunities. You want to entice investors to put up their cash against your opportunities, and being seen as a "local" expert gives them a lot of confidence.
2. Build your presence in the property scene
Successful property sourcing often boils down to who you know.
Growing your reputation and credibility within the industry can open doors to a myriad of opportunities.
Establish relationships with local and regional estate agents, property developers, auctioneers, and property management companies.
Your contacts can provide you with insider information on potential deals and help you gain access to off-market properties that other investors might miss.
Whether it's something that you'll benefit from in the near future or long-term, putting in the effort to maintain strong and effective relationships will often pay dividends at some point.
3. Dive deep into the property advertising platforms
There's an abundance of online platforms where you can find listings, analyze market trends, and track property performance.
Websites like Rightmove, Zoopla, and OnTheMarket are invaluable tools for identifying properties that align with your clients' criteria.
Yes, there's a huge amount of people nationally (in the UK) and internationally on these sites looking for their next investment.
But, how many of them actually act, call local agents, negotiate prices and build relationships? A lot less than you may think, and this where you come in.
These platforms offer a wealth of data to streamline your search process and help you stay updated on market changes.
4. Go and attend various property auctions
Property auctions are treasure troves for sourcing agents.
You can attend local and national property auctions to discover a diverse range of properties.
These auctions often feature distressed properties, repossessions, or motivated sellers eager to close deals quickly.
Remember to set a budget and have a clear property investor strategy when participating in auctions to secure properties at favourable prices.
Go a step further and get to know the local property auctioneers. Try to learn about what properties are upcoming in future auctions. Use this intel to prepare and package property investor deals– but of course be transparent with them that any such deals are not guaranteed given the auction volatility.
5. Target the motivated sellers who are ready
A cornerstone of property sourcing success is the ability to identify motivated sellers.
These individuals (or companies) are often looking for fast, hassle-free sales and are more inclined to negotiate on price.
Motivated sellers can include homeowners facing financial difficulties, probate properties, or those dealing with divorce – yes, sadly it's true and not uncommon!
Developing the skills to recognise such opportunities is invaluable in your role as a property sourcing agent. The best deals are often laid out by property sourcers who can facilitate cash purchases with a person that wants to get rid of their property quickly.
6. Collaborate with credible property developers
Working in partnership with property developers can offer a stream of deal sourcing investment opportunities.
Developers often have access to off-market properties, especially in the off-plan or new-build sector.
You can establish connections with the "good" developers to explore collaborative projects that meet your property investors' goals.
Not everyone wants that run-down or old victorian 3-floor house. Some investors, particular in the foreign market, actually prefer new-build properties built by trusted development companies.
7. Stay abreast of the UK property hotspots
Property hotspots are regions and areas where demand is surging, and property values are expected to rise significantly.
These areas present eye-catching opportunities for investors – keep an eye on locations that are experiencing economic growth, infrastructure developments, or increasing employment opportunities.
As a property sourcing expert, you can guide your clients toward these hotspots to maximise their returns.
Also, if there's a lot of movement with properties traded (buying/selling/renting) in these areas, then you can get a slice of the action with some careful planning and execution.
8. Negotiate, negotiate and negotiate
The ability to secure favourable terms for your clients is the hallmark of a top-tier national property sourcer
When you identify a promising property deal, hone your negotiation tactics to achieve the best possible purchase price. Or, selling price for that better depending on which way you're sourcing property.
Remember that it's not just about price – you can negotiate on other aspects, such as property condition, inclusion of furnishings, guaranteed rents, purchase lease options, or seller concessions.
As disheartening as this sounds: sales skills are paramount in any business, especially if you want to grow it and make it profitable. A property sourcing company is no different.
9. Number crunch to the nearest pound
Sound financial analysis is can often be a cumbersome activity – most people don't like it because you could stuck in front an Excel spreadsheet for hours on end.
Nevertheless, without being able to scrutinise the numbers to the finest detail, you won't get the confidence from investors that you need to secure great property deals.
Before presenting an opportunity to your property investor, perform a comprehensive financial assessment. Consider factors such as the property's market value, potential rental income, financing costs, renovation expenses, and expected return on investment (ROI).
Your analysis should provide a clear picture of the deal's profitability and help your investor make informed decisions.
Investors mainly care about the numbers more than the property itself. If the financials don't add up or anything is unclear, it's a showstopper for many deals that fall through.
10. Demonstrate your compliance governance
Legal considerations need taking seriously in property sourcing.
Similar to the previous point, being setup and conducting your business practices properly, enables your investor clients to act with less fear going into conversations and signing agreements with you. Give them the assurance that you're legitimate.
This is about showcasing your sourcing activities as compliant with all applicable laws and regulations. Here are some crucial legal aspects to keep in mind:
- Director (or Employee) of a UK Company: run or carry out your business activities within a separate legal entity instead of an exposed individual.
- Data Protection: register with the Information Commissioner's Office (ICO) to handle personal data securely and lawfully.
- Anti-Money Laundering (AML) Supervision: if handling client money which in almost al cases you will be, register with HMRC for AML compliance.
- Professional Indemnity Insurance: protect yourself with insurance that covers potential claims of negligence, errors, or omissions.
- Registration with a Government Redress Scheme: join a property ombudsman services like The Property Ombudsman (TPO) or the Property Redress Scheme (PRS) for dispute resolution.
- Compliance with the UK Estate Agents Act: Follow the rules and regulations governing property agents to maintain professionalism.
In case you're interested, many verified property sourcers register to get listed with us. We "verify" them according to our own property sourcer verification process.
11. Prepare pitch decks and property brochures
Impress your clients with thorough the use of clean visuals and reporting tools. It's about being a professional property sourcing business after all.
These PowerPoints, PDFs and other documents should include all relevant information about a prospective property deal, and, in a way that's easy to understand make decisions on.
There are hundreds of tools out there to help, not just specific to the UK property industry but in any domain where sales materials are used – basically anywhere and everywhere!
Estimate costs, project returns, and create detailed reports that capture key data points, to then present in a neat reporting format.
Well-structured property brochures and reports demonstrate your seriousness and meticulousness, offering your property investment clients a comprehensive understanding of the opportunities you put in front of them.
12. Opt for a full-service experience
Offering a full-service package can set you apart as a premium property sourcing agent.
In addition to sourcing properties, you can coordinate services like financing, renovation, property management, and even tenant sourcing.
And, no, you don't need to do this all alone or be the expert in each of these sub-services... That would be way too much to ask for as well as far too time-consuming to even attempt.
Who do you know that can cover lettings? What about refurbs and project management to oversee constructions or kitchen fittings? Given that you're steadily building your UK property network, think about who in these different spaces you could partner with.
Then, you can re-sell into your partners as the intermediary while adding some margin to make additional revenue in these spaces that you're not actually performing the work on yourself.
By guiding your clients through the entire investment process, you'll ensure a seamless and hassle-free experience.
13. Prepare to adapt and don't stop learning
Only the very naive think they don't need to learn anything new anymore. Equally, this group of individuals think that the property industry never evolves and what worked 50 years ago still works today.
That may be true to a certain extent, but things have evolved significantly just like they do in most industries. Did electric cars exist 20 years ago? What about drones at weddings and showcase events? Or how about rent to rent (R2R) properties or publicly advertised serviced accommodation on Airbnb?
The property market is dynamic, and staying ahead of the curve is essential. Dedicate time to continuous learning, whether it's through courses, workshops, or mentorship programs. Adapting to market shifts and adopting innovative strategies will keep you competitive and relevant as a property sourcing business.
Walk the path to property sourcing success
Becoming a proficient property sourcing agent is a journey that combines market knowledge, negotiation finesse, financial acumen, legal compliance and persistence to keep honing in on skills to build and grow.
By mastering these essential aspects and maintaining an investor-centric approach, you can source and present lucrative property deals that meet the diverse needs of most of your customers.
As you embark on your property sourcing career, or if you're already enroute, remember that winning in this field is built on relationships, reliability, and a commitment to excellence.
Each deal you source is an opportunity to make a lasting impression on your investor clients and pave the way for future collaborations.
Finding property investors to source deals for
It's not easy getting new clients in any business let alone forging relationships with property investors who trust you to help find the best property deals.
As a first or additional step in this exciting chapter for you, why not join PropSourcer?
We've build a platform that showcases trusted property sourcing agents operating within the UK. And, every month hundreds of investors are here looking for the right sourcing expert to help them.
So, if you need local and global investors put in front of you, sign up for an account today and start getting qualified leads (i.e. investors) enquiring about you as a credible property sourcer.
