Finding off-market properties is often a great way for real estate investors to purchase property at a price lower than what would be expected. Off-market properties are simply properties that aren’t publicly listed for sale on the local multiple listing service (MLS).
Since they aren’t listed for sale, competition between buyers is low to non-existent. If you’re wondering how to find off-market properties, consider these suggestions.
How to Find Off-Market Properties
There are a number of ways to find off-market properties. A few of the most common include:
Direct Mail Marketing
If you are a savvy investor with the knowledge necessary to identify good investment properties, direct mail marketing can pay off with huge dividends.
Simply design a flier or an ad and mail it to the address of any property you are interested in. Indicate that you are a real estate investor and that you find their home to be attractive for purchase. While personal written communication can often lead to better outcomes, pre-designed ads are useful too.
It’s a simple strategy, but frequently a good investment property can be found by simply driving through neighborhoods or communities where you would be interested in purchasing.
Look for homes that appear to have renters or owners who are living in another area. These properties will commonly appear a little run down. If it looks like the property might be a good investment, find out who the owner is and reach out to them directly. A simple way to find the owner of a property is to look up the county parcel map and go from there.
Real Estate Auctions
If you’re at a loss and wondering how to find off-market properties, attending real estate auctions can be a great option. Depending on the history of the property, it may be sold for only back taxes owed.
This amount can be significantly less than what the market value of the property would be if it were sold on the MLS. Before purchasing, be aware that often these properties will require some TLC before being livable.
Sometimes contractors are hired to perform work on a property before the seller puts it on the market. These contractors can include landscapers, handymen, or electricians. If the contractor has a knack for personal relations, they can often get their customers to discuss why they are having work done.
If the customer is planning to put the property on the market, they may let the contractor know. By keeping strong relationships with well-established contractors, an investor can often be aware of properties that may be coming on the market before anyone else does. This knowledge helps when figuring out how to find off-market properties.
Real Estate Agents and Brokers
Real estate agents and brokers are always on the move. They are often aware of upcoming properties that will be sold on the market before anyone else is. In addition, agents and brokers often cold call homeowners who might be convinced to sell their property.
Forming a relationship with popular real estate agents is a great way to find off-market real estate investment deals. Often they can connect you with property owners who would be willing to sell, given the right opportunity.
Networking with Other Investors
Communicating with other real estate investors is a great way to learn more about investment strategies and properties that may come available. Many investors are in a constant process of purchasing and selling real estate.
They may be willing to let go of a property because it’s become too much of a hassle, or they are seeking to realign their portfolio. Whatever the reason for selling may be, networking with other real estate investors is a great way to grow your own portfolio.
Benefits of Purchasing Off-Market Properties
There are a number of benefits to purchasing off-market properties. In particular, there is usually much less competition. If few people know that a property is for sale, bidding wars can be avoided, and transactions can occur much more quickly.
Also, real estate investors can find many unique opportunities that may not have surfaced in the traditional marketplace. When you’re considering how to find off-market properties, make sure to keep these helpful strategies in mind.
Purchasing off-market properties can be one of the best ways to increase your personal real estate holdings. As these properties are usually available at below-market rates, they take less time to become profitable, providing you with a new source of funds to further expand your buying opportunities.