Finding the right property to invest in is truly not easy – and MLS won’t always be on your side. Despite listing most of the deals in the area, Multiple Listing Service won’t have every property that is currently on sale.
We all know that properties are taken off-market all the time without ever being on the market. These pocket listings, also called the off-market property, can be an excellent investment – for those that manage to get them, that is.
To make it easier for you, we’ll discuss some proven ways to find off-market properties and the best markets for investing in off-market properties – among other things.
So, scroll down to see all our tips and tricks on how to find off-market properties for sale!
Off-Market Properties Meaning: What Are Off-Market Properties?
The phrase “off-market property” refers to any property that is currently for sale but hasn’t been listed on the Multiple Listing Services. Despite being for sale, the realtor handling the sale didn’t list it for various reasons.
That’s lesson number one here – not all properties for sale will be listed on the MLS.
And since it isn’t listed, the only way people may hear about off-market properties is via word of mouth, directly from the realtor, or through the realtor’s network. But if the property is advertised in any way, it’s not considered an off-market property.
This non-traditional practice of listing homes off the market isn’t as uncommon as you assume; roughly 11% of buyers will find investors without listing their property.
However, while it gives investors an excellent opportunity to find a deal, an off-market property can be surprisingly hard to find.
We know how, though, and we’ve compiled a list of 10 proven ways to find off-market properties near me. Be sure to stick around for that!
Advantages Of Buying Off-Market Property
There are numerous reasons why investors would look for an off-market property. There is far less competition for starters – simply because the property isn’t listed on the MLS platform.
Many websites associated with MLS have massive traffic, and each property is seen a hundred – if not a thousand – times. If the property is seen many times, either by realtors or investors, it’s more likely to attract a higher number of offers – making it more challenging for you to get your hands on the property you want.
That way, you stay ahead of the competition – and will generally have to go against only one or two other prospective investors.
Another advantage of finding off-market properties for sale is expanding your search.
When the real estate market demand is high, many other buyers will generally look at a similar investment property as you. So, if you extend your search to off-market properties, you’re more likely to find something that suits your needs.
People who are selling their homes off-market are usually not in a hurry to sell. What does that mean for you?
The process feels less rushed, and the investors can take the time to inspect the property. And to add to that, the negotiations will usually be more flexible, and you don’t have to rush to make an official offer.
It’s also worth noting that people that opt for selling the house off-market typically seek privacy and confidentiality. That’s especially the case with real estate investors selling rental property:
They don’t want to alarm the tenants and cause them to break the lease and move out – or stop taking care of the property – because that would ultimately lower its value.
That, too, could work to your advantage; you’re looking at potentially attractive contract benefits and profit margins for investors.
Advantages Of Selling Property Off-Market
Selling a property off-market can seem like a counterintuitive concept – but as we pointed out in the previous section, some sellers might still choose not to list their property on MLS for several reasons.
Think about it from the seller’s perspective:
Selling off-market guarantees more privacy. Maybe the current owner doesn’t want thousands of people viewing their property. And if they’re selling a condo or apartment building, they could be worried about how that would affect the current tenants, as we’ve explained earlier.
Having one or more tenants move out and failing to sell the building would result in even poorer performance of the property investment-wise.
Another reason would be trying to avoid the endless stream of buyers that tend to call, email, or inspect the property should the seller decide to list it on the MLS. To make matters worse, a lot of them would be people that are neither serious nor qualified to close on the property – wasting both the seller’s and agent’s time.
When the house is selling off-market, the seller’s agent can hand-pick the potential buyers and decide if they wish to show the property to them, which saves plenty of time for all parties – and makes the entire process smoother.
10 Proven Ways To Find Off-Market Properties Near Me
As you can imagine, these off-market rental properties are not easy to find at first because you need to hear about each property – a “pocket listing” – from the right people, at the right time.
However, we know 10 great, proven ways to find just the right property near you and reap all the advantages of an off-market transaction!
1. Direct Mail Marketing
Direct mail marketing can be a highly effective way to find the best off-market property deals out there. It’s pretty simple to do; as the name implies, the idea is to identify your ideal property and the sellers you’re trying to target – and send out postcards or yellow letters to let potential sellers know that you’re interested in buying their property.
Here’s why that’s such an effective method:
Receiving mail directly from you could spark an interest in selling to people that might’ve never considered it before. When looking at a good offer for selling, some people will opt for it simply because someone is expressing interest.
Before you opt for this method for finding the off-market property, be sure to do your research about it. Look into what kind of ads are likely to attract your target sellers, such as postcards or bus bench ads.
Another thing to consider if you go with the direct mail strategy is that you might not have immediate success; it usually takes some time to work.
If you don’t get any calls within a month or two, don’t get discouraged. Rethink your strategy or try to implement another advertising method to increase your odds.
2. Networking
Networking is, hands down, the best lead generation strategy in the real estate business – and that applies to off-market properties, too. Networking with the right people – at the right time – can do wonders in terms of helping you get your hands on the perfect investment property.
It works the same for many different sectors, not just real estate.
Getting in touch with your current real estate connections – and meeting other investors – could open new doors in the world of off-market real estate. It might take some time and practice but be sure to put yourself out there.
Networking can help you access plenty of properties that you wouldn’t access otherwise.
It’s not only a neat way to find a new off-market property; networking also gives you more insight into the real estate world. You can learn about other investors’ strategies, what’s important, what isn’t, what they have in their inventory, and whether or not they’re open to selling their property. And learning about these things puts you in the prime position for finding an off-market property. Plus, many investors will be more open to selling to someone in their network without too much second-guessing if the price is right. It’s mostly a matter of being at the right place – at the right time.
3. Hiring A Real Estate Agent
Real estate agents and brokers are pros when navigating the MLS platform, but they can be just as savvy when it comes to matters such as how to find off-market multifamily properties and other pocket listing deals.
According to the seller’s wishes, real estate agents decide to list or not to list a specific property. That means they probably have at least a couple of properties “in their pocket” they could show you.
You’ll need to find a real estate agent experienced in the area where you want to purchase a property to start the process. Search for the best agents in your area and reach out to them via email or by phone, and ask if there are any off-market properties they know about right now.
Check their website out while you’re at it; the chances are that the agent has listed their pocket listings online already.
Agents know which properties are currently not listed or which ones are about to be listed on the market, meaning they can be of immense help in your search. Even if they don’t have any deals right now, leave your contact information; maybe they’ll have something for you in the future.
4. Searching Through Public Records
Public records are arguably one of the best ways to find off-market properties. Not only that, but if you check the public records regularly, you might even be able to find pre-foreclosed or short-sale properties.
These could turn out to be lucrative investment opportunities – affordable and way below your set budget for the investment.
You can get insight into the public records by looking through the newspapers and visiting state and local government websites to find the properties for sale. These places will probably feature properties that are due for sale soon, too. So, you can prepare, be faster than other investors – and acquire them.
What’s more, you can find expired listings in public records; we advise you to contact the seller listed in the record directly and see if the property is still available.
Some platforms that feature pocket listings will even give you the option to turn on notifications and stay up-to-date on all the new listings. Even if you aren’t looking at the moment, it’s not the worst idea to check up on public records from time to time.
5. Participating In Auctions
Auctions can be a fantastic opportunity to find the right pocket listing since they usually have a steady stream of off-market properties – often at significantly lower prices.
To be up to date, you should visit the auction websites from time to time to see what’s new. You could also ask your contacts from your real estate network about any potential leads – and even check the courthouse’s website for upcoming auctions.
Generally speaking, the auction properties are roughly divided into two categories – foreclosures and real-estate-owned (REO) properties.
Foreclosures are carried out differently in each county across the US, but the process is usually more or less the same. Properties due for foreclosure are generally sold “as is” and typically go for below-market value prices.
Before you do decide to invest in a foreclosed property, be sure to gather as much info about it as possible. It might seem like a lucrative investment, but the property could come with some cons – such as liens and other drawbacks – that could easily undermine the general deal potential.
On the other hand, you have real-estate-owned properties, or REOs – properties in the lender’s possession. Usually, REOs were up for a foreclosure auction and weren’t sold, so they’re now sold as REOs well under the market value.
We advise you to have the property inspected and have a clear picture before bidding on it. You need to keep in mind all the potential repairs the property might require; that determines if it’s worth it or not.
Oh, and another thing – be prepared to act fast. Research the properties that got your attention, know what you want to bid on, set a strict budget, and stay focused on the goal, and you will be successful.
6. Going To Wholesalers
If you’re looking to buy off-market properties, be sure not to overlook wholesalers. Why?
These people specialize in real estate wholesaling. They find the best real estate deals, sign the contract, and then assign that contract to another investor – in exchange for a “finder’s fee,” of course.
Working with a wholesaler can help you find the perfect off-market home for an affordable price. These properties might not have been off-market initially, but since they took it off the market to earn their “finder fee,” the property is now considered a pocket listing.
Be careful when you buy a property from a wholesaler to ensure that you are still paying a fair price. Inspect the property beforehand; the wholesaler might try to downplay some necessary renovations to make the deal sound better.
7. Contractors
Having a few contacts who work as contractors or builders could prove to be pretty useful when you are searching for an off-market property. Contractors have all the information about the best deals in the local area.
Investors sometimes decide to forego renovations or construction mid-project because they can no longer afford it. That could be a chance to swoop in, complete the job, and turn a profit at closing or rent it out for a steady income stream. And who knows better about these situations than the actual contractors.
Getting in touch with a contractor means having access to various pocket listings, so be sure to let people in this business know that you’re out shopping for an off-market property.
8. Scouring The Internet
Searching the Internet can have a surprisingly positive effect on the success of your “how to find off-market properties for sale near me” project. Even Craiglist – along with a few other sites – can feature off-market properties.
Sure, these websites will generally feature the properties listed on the MLS, but they could have their fair share of pocket listings, too. Zillow is a perfect example of what we mean:
Zillow will allow the seller to list for a whole month before they are required to be listed on MLS.
If you’re searching for off-market deals, you should visit these websites often as they have new properties every day.
Scouring the web can be one of the cheapest ways to find a suitable property, but do note that the competition for these properties can be huge. Use the Internet to your advantage – a quick “off-market properties near me” search can do wonders – but be sure to use another strategy from our list along with it!
9. Word Of Mouth
Word of mouth is perhaps the cheapest – as in, completely free – method listed here. It costs you nothing, yet it can be the key to your success.
Start the conversation with people around you, including family and friends. Tell them that you’re looking for an investment property; it will be like building your own real estate network.
Even if you meet someone who isn’t directly connected to real estate, start a conversation about it. The potential connection leading you to your off-market deal is just around the corner!
10. “Driving For Dollars”
Driving for dollars can be a pretty interesting and, not to mention, efficient way to find off-market properties for sale. As you can guess, it involves investors driving through the neighborhoods to find the best deals.
Some would agree that it’s the best way to find off-market properties near me.
Finding off-market distressed properties or vacant homes becomes pretty easy when driving for dollars.
Just look for unkept yards full of junk, covered windows, and visible damage on the property.
When you find something interesting, note the address down to use it later; you’ll need it to look through the state records and find the owner’s contact information. If you manage to get in touch with the current owner, you can ask them about the property’s status – and determine if it’s worth the buy or not.
Driving for dollars can take a lot of your time – but if you’re wondering how to access off-market properties near me on a budget, this could be it.
How To Find Off The Market Properties & Evaluate Them?
We’ve walked you through the methods of finding off-market properties near me. Now, let’s talk about the tools you should be using as an investor.
First of all, consider exploring the Mashvisor Property Marketplace. This platform features a wide range of off market properties spanning the entirety of the US housing market. If you are an ambitious real estate investor looking for a good off market deal, this is the first place you should check out.
But besides the best ways to find off-market properties, you also need to know how to evaluate the worth of the property. You’ll need to know whether the property pays off in the long run and what the return on investment will be.
At Mashvisor, you can find a variety of useful tools to calculate the worth, such as the Mashvisor rental property calculator. It considers all the factors that affect the price now and in the long run!
Another convenient tool you can use here is the Mashvisor rent estimate, which will help you get an idea of your potential cash flow if you’re interested in buying off-market rental properties. The rent estimate calculator can give you a rough estimate of your monthly income – which is a major factor in new investments.
Lastly, the Mashvisor Investment property analysis calculator uses relevant analytics to give you highly accurate real estate evaluations and a clear picture of future profitability. It’s faster, simple to use, risk-free, and – unlike calculating the profits manually – our investment property calculator doesn’t make any mistakes!
Best Places To Buy Rental Properties In 2021
Buying a multifamily property – or any other investment property – could offer a great return on investment if you pick just the right place. That said, here are some of the best places to buy a rental property in 2021:
Avery, North Carolina
- Median Property Price: $758,480
- Price per Square Foot: $282
- Price to Rent Ratio: 21
- Average Rental Income: $3,056
- Cash on Cash Return: 4.28%
Eagle, Colorado
- Median Property Price: $1,299,667
- Price per Square Foot: $559
- Price to Rent Ratio: 38
- Average Rental Income: $2,845
- Cash on Cash Return: 3.33%
Carefree, Arizona
- Median Property Price: $1,403,361
- Price per Square Foot: $406
- Price to Rent Ratio: 23
- Average Rental Income: $5,048
- Cash on Cash Return: 3.28%
Key Largo, Florida
- Median Property Price: $1,146,407
- Price per Square Foot: $771
- Price to Rent Ratio: 30
- Average Rental Income: $3,238
- Cash on Cash Return: 3.06%
Damascus, Oregon
- Median Property Price: $985,913
- Price per Square Foot: $599
- Price to Rent Ratio: 25
- Average Rental Income: $3,286
- Cash on Cash Return: 3.04%
10 Proven Ways To Find Off-Market Properties Near Me – Bottom Line
Finding off-market multifamily properties for sale is not going to be easy – but luckily, there are numerous strategies that allow you to do just that. While some of the methods we’ve discussed are more effective than others, we advise you to combine a few – and find what works best for you.