Playing the “Last-ditch Effort” Real Estate Patience Game
In a world that celebrates selfies and viral videos on YouTube, knowledge is the currency of legendary. And success belongs to those who love learning from others. And where most only get caught up in the whirlwind of social media, you need to retrain your brain to spot purely opportunity and take action.
According to google the “Last-ditch Effort”expression alludes to the military sense of last ditch, “the last line of defense.” Its figurative use dates from the early 1800's.
An effort or attempt that is made at the end of a series of failures to solve a problem, and is not expected to succeed:
So what is a “last-ditch effort” in real estate patience game?
In layman’s terms it’s to practice the “Buy Low Sell High” stock market investor’s strategy which I adapted for the purpose of this blog : “Buy Low&Slow Sell Fast&High”
This works well for the residential real estate market but renting is better suited in the commercial real estate market. To keep things simple we will stick with a residential game plan application.
It’s a last ditch attempt because the land or piece of residential real estate hasn’t sold or is no longer on MLS. Not because of the location but rather the list of problems the buyer would need to solve before even considering to build anything on the lot, therefore by ricochet it’s market value to the eyes of the general public is far less attractive.
Bluntly speaking , it’s what would be considered prime real estate because of it’s desired location but is worth “pennies on the dollar” because of a… excuse my French… sh!tload of building contraints which makes for an investor’s and developer’s nightmare. Herein lies the possible opportunity but first you need to locate these diamonds in the rough, analyse their future potential and build a core negotiation strategy or CNS game plan around each one of them. That is the most difficult and important part of the work.
Restrictions or constraints such as but not limited to
- property access
- property topography
- property size, limitations
- property orientation
- property zoning restrictions
- property environmental issues etc
The Core Negotiation Strategy or CNC
Herein lies the potential opportunity if and only if you are able to solve the specific property restrictions or constraints. It’s the basis the core negotiation strategy or CNS. The CNC is for me to be able to convince the seller to let me take that problem off of his hands.
The REAL Name of the Game in Real Estate is…?
Even if you’re not into the real estate game you probably know that the 3 most important things in real estate is LOCATION LOCATION LOCATION but the real name of the game is FINDING PATIENCE CLOSING. Most of the time when a perfect piece of land in an even more perfect location goes up for sale it will usually sell within days or even hours and guess what the big winners are the real estate agents and the sellers.
Obviously you will need to fork out a HUGE premium for the simple fact that those high demand deals are sought after by all the deep pocket investors and developers. It’s the classic case of more demand then what the market can offer. At the end of the day you can’t and shouldn’t compete with those big guys. It’s futile and plain stupid if you ask me.
Instead you need to go niche and find, look, search, discover those diamonds in the rough that has or aren’t even on MLS today. Patience is required to play the long game but the reward can be very interesting.
Fools don’t rush in… a great hunter is someone who’s very calculated, calm and collected
For the last 20 years which is 50% of my existence on this earth I’ve made it my duty to deliberately dedicate a fraction of my spare time to finding, waiting and CLOSING slash playing on what I`ve coined “Playing the Last-ditch Effort Real Estate Patience Game”
The strategy has been tweaked over time but it remains relatively the same.
Here’s an example,
Sought after prime perfect and pristine lakefront building lots usually don’t stay more then a few days on MLS during peak cottage season. I speak from experience when I say you’d be hard pressed to even make a small profit when you gamble and bet the farm on of these WAY OVERPRICED building lots.
Instead what I looked for were reject lots with a future potential glimmer of hope if done right. This particular lot was an overgrown lakefront lot with not one flat area to build off of but sitting pretty south west facing directly on solid granite with a future sunset view over the mountains. Access was terrible and it stayed on the market for years until one day I located the owner’s phone number and figured out he was now keeping it for his son so I kept in touch and every year a week after everyone receives their property taxes I had an automatic google pop up reminder to call the owner to see if anything had changed and reiterated that my offer… the last-ditch effort offer was still on the table. Until one day about 8 years into it he called me and said Simon I’m ready to take your offer but it needs to happen asap. That same week we closed and I went to town on the lot.
For years I had envisioned the potential of this specific lot and it when it came time to deliver it was as good as sold in my head. Then one day I heard a knock at the door and it was former Minister of the Environment Rona Ambrose and his husband who asked if i’d consider selling my lovely lakefront property. We closed the deal that same month.
Fast forward a decade later and I had made several of these deals both in commercial and residential real estate. I had developed my very own unique game plan
“I’ve had people ask, ‘How come it took you 15 years to win your first NCAA championship?’ I said, ‘I’m a slow learner, but once I learn something, I have it down pretty good.’”
— John Wooden
In Conclusion: I don’t consider myself an expert in real estate and I certainly don’t pretend to have all the answers but I know this, playing the “Last-ditch Effort” real estate patience game is about being prepared, informed industrious, persistent, selective and smart about when to pull the trigger. Those who are successful live by those words and take ACTION. We can talk about it until the cows come home but if you don’t execute the game plan you’ve already failed.
Simon Storm Frigon
Third Generation Design Rebuild Craftsman | CEO @ cdrg+RedTeam | Rebuilding Environments by Design #Rebuild4Life