How to Find Off-Market Properties
Learning how to find off-market properties is a skill that all real estate investing professionals should have. Whether you’re brand new or a seasoned investor, you’re always going to be on the look out for these type of property.
What is an off-market property?
Off-market properties are the unicorns of real estate investing. These are elusive properties that are highly coveted by investors. They are not listed for sale publicly on the MLS.
Why would a property not be on the MLS?
This might be counterintuitive for many people. If you don’t get as much visibility on the property how can one get top dollar for their home?
The first reason is privacy. For example, if a landlord is looking to sell their property, they don’t want the tenants to fear price increases with a new owner or if the deal falls through, why the building they live in can’t be sold. Regardless, some sellers will want to keep their affairs private.
Secondly, some agents may prefer not to list it. This could be for a number of reasons, but primarily if they’re finding that they’re receiving dozens of offers, it might be more productive for them to handle negotiations between a handful of buyers.
10 Strategies to find off-market properties
1. Network with realtors and brokers
Most agents and brokers have extensive buyer and seller lists. This helps them continually stay busy as they have a dependable list of buyers and sellers. However, just by knowing a realtor or broker, doesn’t mean you’ll instantly have access to their off-market listings, aka pocket listings. You’ll need to develop a relationship with them while establishing yourself as a serious buyer and investor, so they are bringing deals to you.
2. Send direct mail
We’re doing this old school and yes I mean flyers, postcards, letter type marketing pieces. This is a powerful way to get off-market properties because some of these homeowners may not have considered selling their home until they read your postcard. So make it convincing, provide value propositions, a free estimate, something that will get your phone ringing. Click here to learn how you can increase your response rates.
3. Connect with contractors
Contractors are likely to be doing work for homeowners who are looking to put their property on the market. If you’re lucky, your contractor may share this information with you. If you have a great relationship with your contractor, they may bring all this information to you. Furthermore, some homeowners may even ask their contractor if they know anyone who might be interested. This is a great resource for finding off market listings.
4. Ask other Investors
Developing relationships is important, especially in sales. If you can establish real relationships with other investors, you might find yourself being able to access some of their inventory. Like most relationships, people want to see the people in their lives doing well. And if you can offer a good deal to your fellow investors, you might be able to get some good properties.
5. Go for a drive
If you want to take a proactive approach, instead of waiting for someone to bring you a deal. You can drive through desirable neighborhoods and look for homes that catch you attention. You might find some homes that look distressed, talk to the person at that house, start a conversation. If they’re not the homeowner, ask for their contact information. If you can’t, use skip tracing to find out more about the homeowner. You never know what might turn into a deal if you don’t ask first.
6. Work with wholesalers
Wholesalers are investors who find deals and get them under contract, and try to sell the right to purchase the property to another buyer. Usually, they are looking for cash buyers and will not list the property conventionally. Therefore, it is an off-market property with not as many buyers vying for it. However, one caveat is that there might be a lot of repairs needed for the property before it can be sold. So run your own numbers and see if the deal is viable.
7. Real estate auctions
These properties can have a lot of opportunities. Sometimes you might be able to buy homes for just the delinquent taxes owed and other times you’ll be able to buy them heavily discounted. The condition is usually that they’ll need a lot of rehab, but sometimes you get lucky.
These deals usually happen live or on websites now.
8. Public Records
Remember when I mentioned you can find people using skip tracing? If you don’t have that available to you, you can use public records to figure out who owns the property. Figuring out who owns it is half the battle, once you can communicate with the owner you can figure out whether it’s a lead worth pursuing or not.
9. Craigslist to find off-market properties
Sometimes, people are able to list their properties before it hits the MLS. This is important because you can set up notifications to alert you when this happens. Moreover, some homeowners may list their home for sale without using a realtor and you may have a higher likelihood of finding this house if you have alerts set up on craigslist.
10. Word of mouth
Nothing is more powerful than connection. As I’ve repeated numerous times, you’ve got to network. Regardless of occupation, people love talking about real estate. Especially now, since it’s so hot! Many people will talk about deals or talk about someone they know who might be selling. Who knows where that can lead, but you’ve got to follow them. So make sure to network with people and see if you can find new business deals.
Whatever your tactic, remember to always be a good person. You attract more bees with honey, than you do vinegar. This is an industry where you can help people. Inversely, there may be people who may try to take advantage of you. So before you enter any deal, make sure to run the numbers first.