How to Work With a Bird Dog When Flipping Houses

In the house-flipping business, a bird dog is a scout. Just like the dog that seeks out and rustles up birds, a house-flipping bird dog hunts down promising leads and offers them up to their real estate investment contacts.

Just as a hunter’s success can depend on the quality of his canine, a skilled and seasoned bird dog can lead the aspiring house flipper to promising and ultimately successful property leads.

Delegating the scout work to a bird dog saves you both effort and time. Time is money, especially when it comes to flipping houses.

Why Use a Bird Dog?

Bird dogs are important for any house-flipping business. However, they're especially useful for new investors still building their networks. A good bird dog can do much of the initial legwork for you, bringing you information and rich leads on properties with house-flipping potential. Their work gives you the freedom to focus on other things, allowing you to juggle additional projects.

The key to working with a bird dog is to establish a productive working relationship. This means a bird-dog and house-flipper relationship that is collaborative, structured, and incentivizes both parties to provide maximum value.

A good relationship is key to both of you achieving whatever career and financial goals you have. There are a number of factors to think about, some of the most important being:

• Compensation: How much should I pay a bird dog? When do I pay them?
• Communication: What’s the best way to stay in touch with a bird dog? How often should we be talking?
• Contracts: Do I need a contract with a bird dog? 
• Long-Term Relationship: What does a successful partnership between a bird dog and a house flipper look like over time?

While there are no one-size-fits-all answers to these questions, there are many general principles and best practices to keep in mind. The key is to plan in advance. Think about your approach to these questions now, and you’ll have success in working with a bird dog later.

How Much Should I Pay a Bird Dog?

Compensation is key – you and your bird dog are both here to make money. This will likely be the first thing you discuss with a potential bird dog. 

In fact, most bird dogs who advertise their services will lay out a flat fee upfront. This is useful, as it sets expectations early and can help narrow down your search to find a bird dog who fits your expectations and budget. 

But no matter what, it's important to decide how much you'll pay a bird dog for house-flipping leads and when you'll pay.

Payment should always be discussed upfront. You and your bird dog need to agree on how much you'll pay per lead and when you will pay. 

Money is important to any business relationship – and setting expectations and coming to a clear agreement can mean the difference between failure and a rewarding house-flipping partnership with a bird dog.

The question of how much and when to pay a bird dog can often depend on experience, both yours as a house flipper and the bird dog’s track record in acquiring productive leads.

New Bird Dogs and House Flippers

If you're both new to house flipping, you might offer a small amount of cash upfront just for information.

This approach can work well with someone who doesn’t even think of themselves as a bird dog. There are many people out there who have valuable information and don’t know it. They may see leads every day – but if they’re not in the right mindset, they won’t recognize them.

Think of all the potential bird dogs who may often see distressed properties in their day-to-day lives and work:

• A rideshare driver whose work takes him all over and to all types of neighborhoods
• A mail carrier who notices houses becoming run-down over time and may see other hints that a property could be a house-flipping opportunity
• Trash collectors, who often have a unique view into the lives of a neighborhood’s residents.

Offering a quick payout in these types of situations can lead to quick information. The downside to these types of property leads is that they will usually not offer much information or detail. But, this can be a useful tactic when you're just starting out. 

In house flipping, having the right info – and having it at the right time – is vital, and for real estate investors without an established network, offering cash to the right bird dog could be what gives you the edge on a distressed property lead.

Paying upfront can be useful for a brand new house flipper, or for an experienced investor looking to incentivize a source into bird-dogging for them. However, house flippers will most often only pay a bird dog when they close on a deal. Experienced bird dogs know and expect this. They know their payday depends on you closing the deal. This motivates them to seek out and bring you promising leads. It also protects you from losing money on unproductive property leads.

Experienced Bird Dogs and House Flippers

Other bird dogs take a more proactive approach. They will seek out leads for house flippers. Rather than waiting to be approached, these bird dogs scout out properties with flipping potential and advertise their services and information.

Experienced bird dogs maintain property files with detailed information. They are more likely to offer consistent and productive property leads and will expect higher pay. They will work with more seasoned house flippers. 

An experienced bird dog can also be skilled at connecting the right investor with the right property. After all, not every deal is right for every house flipper. A seasoned bird understands this and will bring a lead to a house flipper who can most productively work that lead.

This can present a cyclic dilemma. To close deals you need good leads. But getting good leads is easier when you have an established track record of closing deals. When it comes to building your network and your house-flipping business, remember that everything is negotiable.

Flat Fee vs. Percentage

How much you pay a bird dog can also depend on whether you offer a flat fee or a percentage of the eventual deal’s value. Both approaches have advantages and disadvantages. The way you choose to pay your bird dog can also depend on your own approach to the house-flipping business.

It's common to offer a flat fee per deal you close. This approach can help increase your volume of leads. It motivates the bird dog to bring you every lead they can find, increasing their odds of a payday. Paying a bird dog a flat fee per deal closed is the simplest approach.  

But an alternative is to pay your bird dog a percentage of any deals that come from their leads. This approach can help to emphasize quality over quantity. It will motivate the bird dog to bring you their most high-value leads since that will lead to more profit for them. This works best with an experienced bird dog who brings you solid leads.

Paying a percentage incentivizes the bird dog to seek out higher-value leads. This is a win/win for the bird dog and the house flipper.

Everything Is Negotiable

In business, and especially the real estate business, everything is negotiable. While it’s important to lay out expectations early, remember that nothing is set in stone. House flipping is a fluid business, where things can change quickly. You should be ready to adapt, whether that means changing a specific deal, or altering your own approach to the business.

This is especially true of the partnership between a house flipper and a bird dog. So don’t be surprised when a bird dog tries to negotiate with you. And don’t be afraid to negotiate yourself — the worst they can say is no.

No matter how much haggling is involved, have that discussion early. This will set you both up for success. And a successful property deal now is the key to more successful deals in the future.

Do I Need a Contract With a Bird Dog?

You should have a contract with your bird dog. A good contract protects both the house flipper and the bird dog. It clearly spells out expectations and provides accountability.

But contracts between house flippers and bird dogs don't have to be complicated. It can be as simple as how much you will pay per lead and when you will pay. You can lay this out in an email, or provide a paper document that you both sign.

The more detail and work expected, the more detailed the contract should be. Experienced bird dogs will provide more information than just an address. This can include pictures of the property and contact details for the distressed property's owner. This should be agreed upon in advance and included in your contract.

Your contract can also define a deadline to close the deal. This means that you have a set amount of time to close on the property and pay the bird dog. If you aren't able to work the deal, they are free to shop the lead to another house flipper. 

A deadline reassures the bird dog that they are not wasting their time, and it incentivizes you to work quickly, an essential characteristic of the successful house flipper.

A good contract between a house flipper and a bird dog helps ensure a productive partnership.

How Often Should I Check in With My Bird Dog?

There is no one-size-fits-all answer to how often, or how, a house flipper should stay in touch with a bird dog. The truest answer is – as often as you need to. The important thing is to maintain consistent communication.

How you communicate with your bird dog is up to you. Email and text are more convenient, but phone check-ins help establish a personal connection. This can also vary depending on you and the bird dog’s personalities and preferences. Most likely, you’ll settle on a mix of text, email, and phone one-on-ones.

You should check in with your bird dog on a regular schedule. This keeps you aware and up-to-date on their work and leads. It also ensures you are on their mind too. When a bird dog finds a new lead, you want them to think of you first and be eager to do business with you. 

Being proactive and productive will help cement a solid relationship between the house flipper and the bird dog.

Thinking Long-Term

How your working relationship with a bird dog develops can vary depending on what you both want out of the partnership. Some bird dogs are solely focused on chasing down leads, building their files, and connecting the right investor with the right property. Over time, these bird dogs can be rich sources of valuable leads as you both develop your respective businesses.

But other individuals get into the bird-dog business as a stepping stone to other ventures. For many, it can be the first step into real estate investing and house flipping. Tracking down and presenting leads provides valuable experience and exposure. Working with investors and house flippers helps them to learn the ins-and-outs of the real estate business.

So don’t think of your bird dogs just in terms of what they provide you now. Think about what you can do for each other in the future as well. A skilled bird dog could also be a successful house flipper or a real estate investor. Many bird dogs make the jump from scout to flipper through mentoring relationships that lead to successful business partnerships.

Tying It All Together

Bird dogs are essential for any house flipper, whether novice or seasoned. To be successful at house flipping, you must establish a productive working relationship with your bird dog. Key factors to keep in mind are compensation, communication, and thinking long term. Nail those and both you and your bird dog will be set up for success as real estate investing partners.