What is a 'Bird Dog'

Bird dog is a real estate investing term that refers to someone who spends their time trying to locate properties with substantial investment potential. A bird dog looks for motivated sellers or undervalued properties with the intention of passing the deal on to a real estate investor in exchange for a percentage or fee. Bird dogs work as an intelligence network for real estate investors. Real estate investors may work with a network of bird dogs to increase the area over which they are looking for real estate deals. Similarly, a bird dog will also develop a network of real estate investors so they have a better chance of converting a particular lead into a deal. The term bird dog is more strongly associated with identifying properties for flipping, but it may also be used in the context of identifying income properties or residential rentals.

The term bird dog is a reference to hunting dogs that point to the location of birds and retrieve any birds the hunter successfully shoots. 

BREAKING DOWN 'Bird Dog'

Bird dogs are perhaps more plentiful and less successful than late-night infomercials and real estate seminars often suggest. The mythos around the bird dog is part of the quick money millionaire aura that ebbs and flows around real estate investment. You have no money to invest in real estate? You can learn the trade by seeking out great deals for well capitalized investors and building up your own stake through fees to finance your first deal. In theory, acting as a bird dog is a valuable opportunity to practice identifying distressed properties that can be remodeled or simply touched up for a significant profit. In reality, there aren't so many well capitalized real estate investors just waiting for the chance to train a bird dog. Successful bird dogs do exist, but they have likely spent years or decades in the real estate business and have a history of successful deals with a network of private investors. A new bird dog would find it challenging to match that history and experience. That said, if you are interested in becoming a bird dog, it may be wise to find a kindly real estate investor or a seasoned bird dog to learn from. Just don't expect to build your own empire off the back of theirs. 

Bird Dog Techniques

If you live in a city, you've probably had exposure to some bird dog marketing techniques without necessarily realizing it. The signs saying "We Buy Houses" with a mobile number are targeted to pull in sellers who need to get out of their property but don't have ties to the traditional real estate process. Similarly, some bird dogs use auto dialers and mailing circulars that suggest they can pay cash today for your home. Along with this grassroots lead generation, bird dogs may tap into public databases like the multiple listing service (MLS) and try to cross reference with other pertinent information, like layoffs at a nearby company (motivated sellers) or dropping home values in recent tax assessments (underwater mortgages). Essentially a bird dog needs to cast the widest net possible to generate enough sellable leads to pay for the effort and costs involved. 

RELATED TERMS
  1. Dog And Pony Show

    A dog and pony show is a colloquial term that generally refers ...
  2. Real Estate Investment Group

    A real estate investment group is an organization that builds ...
  3. Implied Contract

    An implied contract is an agreement created by actions of the ...
  4. Property Derivative

    A property derivative is a financial product that derives value ...
  5. Problem Child

    A problem child is one of the four categories in the growth-market ...
  6. Canine Liability Exclusion

    Canine liability exclusion is a homeowners policy exclusion that ...
Related Articles
  1. Investing

    Barking Up The Dogs Of The Dow Tree

    One well-known and successful strategy for cashing in on dividends is the Dogs of the Dow. Here's what you need to know about them.
  2. Investing

    Dogs of the Dow for 2017

    With all eyes focused on the Dow's recent rally, there is one investment strategy that couldn't care less.
  3. Insights

    Rovio Entertainment, Maker of 'Angry Birds,' Plans IPO

    The firm swung to profitability last year on the back of a box office hit and significant cost-cutting in its ranks.
  4. Personal Finance

    Financial Advice for the Year of the Dog

    According to the Chinese zodiac, 2018 is the year of the dog. If this is your year, make the most of it in your finances.
  5. Investing

    Walt Disney World Making Some Hotels Dog Friendly

    Up until a few days ago, the only dogs you would see in Walt Disney (NYSE: DIS) World's hotels were Goofy, Pluto, and service animals. That's not so anymore. The entertainment giant has decided ...
  6. Investing

    A Guide to Real Estate Investing

    Investing in real estate is a popular choice for good reasons, but it's more complicated than owning your typical stocks and bonds.
  7. Investing

    A Guide to Real Estate Investing

    Investing in real estate is a popular choice for good reasons, but it's more complicated than owning your typical stocks and bonds.
  8. Investing

    Can Real Estate Stabilize Your Portfolio?

    History suggests that real estate can provide diversification and a hedge against inflation.
RELATED FAQS
  1. What financial metrics are best for evaluating companies in the real estate sector?

    Learn about some of the most important financial metrics and other analytic tools before investing in a real estate company ... Read Answer >>
  2. What are the main segments of the real estate sector?

    Understand what the three primary segments of the real estate sector are and the metrics used by investors and analysts to ... Read Answer >>
Trading Center