There’s no doubt that professional and experienced property sourcers play a crucial role as intermediaries between investors and potential property investments.
They can act as the bridge, understanding investors’ needs, goals, and investment criteria, and then sourcing properties that align with these requirements.
What is Property Sourcing?
Property sourcing is the process of finding properties or land that match the investment criteria of individual investors.
Property sourcers act as experts who conduct the sourcing process, identify suitable opportunities, and package deals on behalf of the investors. They can assist in securing the right property, negotiate with sellers, and receive a fee for their services upon successful completion of the purchase.
Importance of Understanding Investor Needs and Goals
Understanding investor needs and goals is paramount for property sourcers to deliver optimal services. Investors have diverse preferences, risk appetites, and financial goals. Which means that property sourcers must thoroughly comprehend these aspects to present suitable investment opportunities. This understanding not only enables the sourcers to find properties that meet the investors’ criteria but also builds trust and strengthens the working relationship between both parties.
The Four Stage Sourcing Process
Property sourcers follow a structured four-stage sourcing process to effectively serve investors:
Stage One – Fnd The Property Investor:
Property sourcers identify and secure investors to work with. They understand the investor’s strategy, the geographic area they want to invest in, and complete due diligence before commencing the sourcing process. Finding the investor first means that now you can go out and find the deal, knowing you have someone to sell it to. Much easier.
Stage Two – Sourcing Deals:
In this stage, property sourcers generate leads on potential properties or land deals. They filter these leads based on their potential, arrange viewings, and conduct due diligence on the properties.
Stage Three – ‘Packaging’:
Property sourcers create professional reports or brochures for the identified deals, including all key elements. They present these reports to the investor and secure an agreement for the property purchase.
Stage Four – ‘Deal Monitoring and Progression’:
The property sourcer monitors the purchase progress, liaising with solicitors and other professionals involved in the purchase process. They ensure the successful completion of the deal and receive their sourcing fee.
The Benefits of Using a Property Sourcer
Utilizing the services of an experienced and professional property sourcer offers several benefits to investors:
1. Access to Opportunities:
Property sourcers can provide immediate access to a range of properties, including off-market deals, that may not be available on the open market.
2. Guidance and Due Diligence:
Sourcers conduct thorough research and due diligence on properties, providing investors with vital information for making informed decisions.
3. Time and Cost Savings:
Property sourcers streamline the buying process, saving investors time and effort in searching for suitable properties and handling negotiations.
4. Referral to Trusted Professionals:
Sourcers can refer investors to trusted professionals, such as solicitors, tax advisors, and property managers, to facilitate a smooth transaction.
Risks of Buying from a Property Sourcer
While property sourcing can be highly beneficial, there are potential risks involved, particularly when dealing with inexperienced or non-compliant sourcers. Investors should exercise caution and consider the following:
Some individuals or sole traders may not adhere to industry standards, leading to difficulties in resolving disputes and the potential loss of sourcing fees.
Investors should be wary of sourcing agents who promise deals that cannot be delivered, leading to wasted time and resources.
Property sourcers play a pivotal role in the property investment sector by understanding investor needs and matching them with suitable properties. By following a structured sourcing process and conducting due diligence, property sourcers help investors achieve their investment goals. However, investors must exercise caution when choosing a sourcer and ensure they partner with experienced and compliant professionals.