There are many ways to make money with Real Estate. In my opinion, one of the easiest ways to make money with in this business is becoming a Real Estate Bird Dog. Stop before you rush out the door! You’ll still have to work at it. However, many of us believe it’s far easier with fewer headaches than many other techniques.
What is a Real Estate Bird Dog?
A Real Estate Bird Dog is a person, or in some cases a company, who locates investment property for Investors.
Why would Investors pay for a service like this? Simple. Many Investors are business people who are busy making money. They don’t have time to hunt down good deals in major real estate markets. This is where you into play.
What do I have to do?
The most important thing to know to become a successful bird dog is know your local market. To do this, bird dogs seek out relationships with real estate brokers, agents, bankers, lenders and anyone else who may have knowledge of a good investment.
In most markets, the bird dog will be a person who already works in the real estate field, for example a Agent or perhaps an assistant to a Real Estate Agent. However, I know Bird Dogs who do nothing other than find investment deals for investors.
How do you make money with this?
Normally once a bird dog finds several investments or investment leads, they then present them to the investor. When/if they buy the investment, the real estate bird dog is paid a service fee which is typically a percentage of the price of the investment or it could be a flat fee, it depends on the bird dog.
What are the advantages?
One advantage is that once you hand the property off to the investor, you job is done. You don’t have to worry about setting up financing, inspections or any other of the headaches that can come with investing in real estate.
How much can a real estate bird dog expect to make?
Obviously it depends on what percentage of the deal you decide your time and effort is worth, but some command as high as a 10% finders fee. I’ve heard of higher fees, but most that I’m aware of run in the 3 to 6% range.
Are there any disadvantages?
Well, for one, in some states, if you find real property for an investor and then charge a fee, they feel you need a real estate license. Check with the State you live in before going into this.
Whatever you do, get everything in writing. At the worse case, you’ll have to take a few nighttime classes and get your real estate license. There are worse things to do! At the least, you’ll just have to start networking with the industry in your market to get in on the ground floor of becoming a real estate bird dog.