Buying off market property has become an increasingly popular strategy in real estate investing. Off market properties for sale refer to property that is sold without being advertised or listed on mainstream real estate websites.
There are several reasons why a seller would decide to sell off the market:
- They might be going through a difficult period such as a divorce, and thus, they need to keep the sale out of the public eye.
- They may be in high profile positions. Selling off market allows them to maintain their privacy.
- They might have difficult neighbors that could sabotage the sale.
But what if you’re a property buyer? Why should you go after this type of investment property? As it turns out, there are actually plenty of benefits to buying off market homes.
Here are some of the benefits of going for off market real estate deals:
#1. Less Competition
Buying through conventional methods such as MLS listings means facing a lot of competition. You could spend days and even weeks in negotiation without getting a deal. However, the story is different when it comes to off market properties for sale. Since no one or only a few people know about the property, you have a higher chance of getting it below market value. Less competition means that you don’t have to get involved in bidding wars. If the seller wants to make a quick sale, you can get a good deal on a cheap investment property.
#2. No Spotlight
The ability to maintain privacy is a benefit for sellers as well as buyers. Buying off market properties for sale is especially helpful for people that are in prominent positions. You can buy property in peace while keeping reporters and bloggers out of the transaction. Buying off market homes means that you can move forward with your life without revealing your marital or financial status.
#3. The Benefit of Time
Having less competition when purchasing off market properties for sale also means that you will have more time to view and inspect the investment property. In addition, there will be plenty of time to build a relationship with the seller and negotiate before deciding whether or not to buy. However, you might not have the benefit of time if the seller is distressed and wants to complete the off market deals as fast as possible. But, as mentioned, this could mean a cheaper property for you.
#4. A Smoother Real Estate Transaction
When sellers work with many buyers, the sale process can be very slow and chaotic. However, if you are the only buyer, the seller will be able to dedicate more time to you. This will greatly enhance the chances of a faster transaction.
How to Find Off Market Properties
So, you now know the benefits of buying off market homes. Are you ready to take advantage of them? Well, the first step in investing in off market properties for sale is to know how and where to find them. Here are some tips for finding investment properties for sale off the market:
1. Driving for Dollars
As the name implies, this strategy involves driving around neighborhoods looking for off market properties for sale. Driving for dollars is especially effective for identifying distressed and vacant condos, multi family homes, and single family homes. When it comes to spotting vacant or distressed property, some of the signs to look out for include boarded windows, uncollected mail, overgrown grass, and scattered items in the compound. If there are neighbors nearby, ask them if they know the whereabouts of the owner. Alternatively, write down the address and check the county records for the owner’s contact details. You can also use Mashboard to quickly and easily find out who owns a property. You can then reach out to them via email or phone and make an offer.
Related: What Is Driving for Dollars in Real Estate?
2. Networking with Real Estate Agents
Real estate agents that are familiar with the neighborhood where you want to buy can be very useful in finding off market properties for sale. Even before properties are listed on the market, agents often know about them already. You can start by creating a list of the leading real estate agents in the area where you want to purchase investment property. Get in touch with them via email or phone and find out if they are aware of any off market houses. Even if they cannot offer any help currently, stay in touch with them and keep them in your network for future updates on off market properties for sale.
Related: How to Build a Real Estate Network You Can Rely On
3. Builders and Contractors
Besides agents, contractors and builders can also come in very handy for anyone looking for off market real estate properties. Local builders and contractors are usually aware of properties where the investor or homeowner abandoned the project midway due to a lack of finances. Though this is a sad situation for the owner, it presents a great opportunity for real estate investors that are ready to buy. Therefore, take time to build relationships with other real estate professionals in the area in order to identify off market properties for sale fast.
4. Public Records
Public records often contain information about off market properties for sale such as short sales and pre-foreclosures. Therefore, be sure to keep up with local and state government websites, as well as newspapers and magazines. Such sources are likely to mention rental properties that are yet to be listed for sale. You could also set up alerts on relevant websites in order to be updated on current properties up for sale.
5. Direct Mail Marketing
This strategy involves distributing bulk postcards or letters in a specific area indicating your interest in purchasing off market properties for sale in the neighborhood. At times, homeowners don’t even think about selling until an attractive offer is presented to them. You could suggest a price range and then leave your contact details at the bottom. However, don’t give up if you don’t see results immediately. You might have to conduct several direct mail campaigns before finding the ideal income property.
6. Online Resources
The Mashvisor Property Marketplace is a great place to find off market real estate listings. You will find a wide range of off market properties for sale including tenant-occupied rentals and foreclosures. This site also comes with property filters that allow you to narrow down listings to fit your criteria. In addition, you can use the investment property calculator to analyze the investment potential of a property. The best thing about the Mashvisor Property Marketplace is that the contact details of property owners are readily available.
Related: The Pros and Cons of Buying a House with Tenants
7. Word of Mouth
Let your family members, friends, and everyone else you meet know that you want to buy an investment property. The more you make use of word of mouth marketing, the higher your chances of finding and owning an income property. Even if someone is not directly involved in real estate, they could be the connection you need for your next investment deal.
The Bottom Line
Investing in off market properties can be quite beneficial- that’s why so many of the pros go after this type of deal! Once you learn and understand the benefits (and be sure to look into some of the cons), try out a few of the strategies listed above to find your first off market real estate deal!