Real Estate Investing Guide: 5 Ways to Find Off-Market Properties
Finding off-market properties is the best strategy to pave your way to profitable investments. The reason why experienced investors look off-market first is that there is too much competition around listed properties. This usually leads to competitive negotiations and high commission costs, meaning there will be less money left in the wallet to do upgrades and renovations later on. In other words, off-market properties simply pay off more because you have the opportunity to increase the property’s value and gain a better ROI. The question is, how do you find those off-market deals? Here are five ways you can look for them!
#1 Work with Real Estate Agents
While not every real estate agent will be willing to give you access to relevant off-market data, you can always find an investor-friendly realtor to make a deal with. Realtors often have both a buyers and a sellers list, meaning they have the information you need regarding properties that haven’t hit the market yet. The goal here is to find a friendly investor who is willing to make a mutually beneficial deal with you. You need to create a win-win situation for both yourself as the investor and for the realtor as well. That way, they will be more than happy to give you access to their pocket listings.
#2 Try Direct Mail Marketing
While direct mail might seem like an outdated strategy, it is still quite efficient in the real estate world. This includes sending targeted mail directly to the owner of a property in hopes they are willing to sell. Keep in mind that direct mail marketing is equivalent to shooting in the dark. You will be sending out these invites in hopes to come across one or a few owners who are actually looking to sell. In other words, a huge portion of this strategy is pure luck. However, there’s a lot of work to put into direct mailing since you have to find rental properties you’re interested in and dig up information about the property’s owner.
#3 Network with Contractors
In real estate, it all comes down to networking. Having the right connections can truly make or break your career in this industry. Besides networking with other investors and realtors, you need to make connections with contractors as well. Contractors usually work with property owners and they might have relevant info about off-market deals. If they are working with a homeowner on prepping a property for sale, they might be able to connect you with the seller and help you land an off-market deal. As always, it’s a matter of playing the numbers game and bringing in as many connections as possible.
#4 Drive for Deals
Just as the name suggests, this method includes driving around the neighborhoods you’re interested in and looking for deals that might make sense for you. It is a good idea to have someone else drive while you’re on the lookout for potential investments (safety first). Make sure to look for distressed properties whose owners would be happy to sell. These are usually the easiest deals to close. Reach out to as many property owners as possible and make sure to find a way to follow up with them later on. Remember, they might not be looking to sell right away but they might change their mind a few months or a year from now. By giving them a way to contact you, the work you’re doing now might actually pay off later down the road.
#5 Work with Wholesalers
Wholesalers usually find deals, get them under contract, and then flip those deals to earn a finder’s fee. They usually handle a large amount of properties all over the place, meaning they might have something for you. By connecting with successful wholesalers, you might be able to get insight on off-market properties before your competition. Keep in mind that in most cases, wholesalers are dealing with distressed properties, meaning you will most likely have to do some renovations, which is not a bad deal at all.