Every real estate investor talks about the ever-elusive and highly-coveted off-market deal.
Let’s take a look at some of the best ways to find these types of properties in this article.
Real estate agents and brokers
A real estate agent or broker usually has a buyers list as well as a sellers list. If shown that market conditions are favorable, these sellers may be prompted to sell. Moreover, hungry agents may cold call homeowners in the area and turn them into sellers.
In addition, many of them have pocket listings. A pocket listing refers to a property that an agent has exclusive rights to sell, and which is not listed on the MLS. Many local agents will keep a listing in their “pocket” to prevent word from spreading, which is often to the benefit of the seller.
Off-market listings can be challenging to find, but only initially. It is because as soon as you start working with an agent, they will likely have a built-out buyer list to whom they market their off-market deals. You will be taken more seriously by agents when you establish yourself as a serious buyer and investor, and they will actually want to introduce you to deals since they know you can close them.
Direct mail marketing
As its name suggests, direct mail marketing entails sending targeted mail directly to a potential landlord in hopes of purchasing their rental property.
Direct mail marketing can be an effective way to uncover off-market deals. It is possible that the owner did not consider selling before receiving your mail. Therefore, you may be the only person interested in the property.
Contractors are great for finding off-market deals since they usually work with property owners. In addition to being good at the physical aspects of the role, a great contractor also has some soft skills, such as listening and gathering data.
A property owner may share information with a contractor when preparing their property for sale. Depending on your relationship with the contractor, they may be willing to share that information with you, allowing you to contact the seller prior to the property being listed.
Further, an owner might ask the contractor if they have any other clients who might be interested in buying their property. In many cases, it is more beneficial to have a great working relationship with contractors than it may appear at first.
Networking with fellow investors
Knowing other savvy investors immediately gives you access to literally thousands of properties. Who says you shouldn’t make an offer right then and there if you know or meet someone who has a property you’d like to buy; it’s like a real-life Monopoly game!
A deal that makes sense, regardless of where it comes from, will make sense at a particular time and place.
You’ll gain insight into a few things if you network with other investors:
- Their inventory
- Their strategy
- Whether or not they’re looking to sell
Understanding these can help you locate off-market listings.
The wholesaler is someone who finds deals, puts them under contract, and then sells the right to purchase the property to another buyer for a fee. Wholesalers place properties under contract everywhere.
You may be able to get on an off-market contract if you have a relationship with a wholesaler. The fact that it’s under contract means it’s technically off the market even if it wasn’t off-market originally.
When buying from a wholesaler, it is often necessary to rehab the property, so it is important to run your own numbers to ensure the deal is still viable. Wholesalers may underestimate the repairs needed to make the deal look more appealing.
Real estate auctions
Off-market deals can be found here for pennies on the pound. Auction websites and live auctions are used for the sale of properties, usually for back taxes owed.
In certain jurisdictions, you may be able to purchase a property for just the delinquent taxes. In the same way as wholesale deals, these properties generally require a lot of rehab.
A property’s ownership is typically documented in public records. You can determine the mailing address or another way to reach a property owner by checking the public records in that county.
Finding out who owns a property is only half the battle. When that’s done, you may have to convince them that selling their property to you is a good idea.