Real Estate Investor Magazine South Africa April/May 2019 | Page 36

COACHING
ADVERTORIAL
The Art of Writing an
Offer to Purchase
Paint your own Mona Lisa
BY CARLO MARIANI
M
ost Property Investors understand that a signed Offer
to Purchase (OTP) means serious business and one
should never present an OTP without the under-
standing that this is a legally binding document that gives the
Purchaser very specific rights and obligations.
But the real issue is another one in my experience; the real
issue is that most investors are so scared about signing an OTP
that they make one fundamental mistake that is guaranteed to
put their Property Success in the slow lane: the mistake is not
presenting a large enough quantity of signed Offers to Purchase.
But why are Investors making such mistake? There are two
factors that in most cases contribute to this slow lane mistake:
• Struggling to define for themselves what a really good deal is,
due to their inability to determine what the property’s fair market
value
• Fear that one or more OTPs might get accepted leaving the
investor unable able to raise the money and/or the debt finance
required to take the deal to completion
Do you want to Fast Track Your Property Success? Master
the Art of Writing a Profitable OTP and then be prolific at
submitting signed written OTPs. Having grown up in Italy,
I love comparing writing an OTP to the famous Mona Lisa
painting. Leonardo da Vinci was a very prolific artist and while
the Mona Lisa might look like a simple, small painting of a
woman’s face to the less educated, it is indeed one of the most
admired and complex paintings in art history.
So how do you go about writing your own Mona Lisa
masterpiece OTP? And what rules should you follow?
Here are four practical strategies to GET MORE DEALS
AND MORE PROFITABLE DEALS:
Strategy # 1 - Have your clear personal defini-
tion of a Great Deal
A great deal for me might not be a great deal for you and
vice versa. There is no such thing as the perfect deal, as this
depends entirely on your objectives and circumstances; having
said so it is critical that you have a written, explicit and easily
measurable definition of what a Great Deal looks like for you.
We like to call this your Minimum Deal Standard. Not having
a Personal Minimum Deal Standard is likely to result in slow
lane property investing behaviours. The first one is that you
will never close on a deal because you always thing you might
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APRIL/MAY 2019 SA Real Estate Investor Magazine
do better, the other one is that you will close too many deals
that are sub-optimal.
Strategy #2 - Use your own Offer to Purchase
I have spent many years developing my very personal Offer
to Purchase that protects my rights (and the ones of my
students and co-investors) first and foremost whilst being
ethical towards all parties involved. I like to think about it
as my Property Profit Insurance Policy…You should have
this in your Success Tool-Kit especially as I share with our
students and mentees not only the power of control and risk
management but also the opportunities that are available
when you source property deals directly from Sellers.
Strategy #3 - Stop Negotiating with Yourself or
the Agent
Simple truth is that you will never buy Properties below
Market Value if you do not write Offers to Purchase; a simple
action that you can start taking today is to write more OTPs.
Do you want to buy 1 Property? Make 9 Offers! It is indeed
a ‘numbers game’. But do not write just any offer; write and
present more offers based not on the asking price but on
the price (and conditions) that will allow you to meet your
Minimum Deal Standard.
Strategy #4 – The Money is in the Follow-Ups
In my experience very few profitable deals happen upon
presentation of the first OTP or even soon thereafter;
time, especially in this buyer’s market, tends to soften the
expectations of Sellers; motivated sellers also have a natural
tendency to believe that their problems will go away while
in actual fact this is rarely the case. The more you follow up
at regular and sometimes even distant timeframes from your
original OTP, the more likely you are to score the deals you
really want.
‘Learning never exhaust the mind’— Leonardo da Vinci.
The best time to Fast Track Your Property Success and use
Property to achieve Financial Peace of Mind is not now and it is
not just now, it is NOW NOW. I look forward to seeing you at
one of our Property Education Events.
SOURCE: ThePropertyCoach.co.za