Sunday, May 28, 2017
Where to Find Off-Market Properties
Wholesaling involves buying at a LOW price and selling to another investor or rehabber at a LOW price to complete the work necessary to bring a property to market. Anyone can buy a property on market, but rehabbers willingly pay wholesalers to find properties that are more difficult to find.
Anything listed on the multiple listing service is priced at retail, not wholesale. Even the major fixers will be bid up in the frenzied real estate market that exists in our area now. The best opportunities to pay wholesale prices for properties exist off-market.
Many wholesalers find property through a direct mail campaign to homeowners most likely to NEED to sell. It is much more likely to get a property under contract at a reasonable price with a seller who is MOTIVATED to sell, rather than with someone who is "in no hurry," "doesn't need to sell," or "who is not going to give their house away." If you hear these words out of the mouths of your seller, just move on. This is your clue that you are not dealing with a MOTIVATED seller.
Who is motivated to sell? Someone in distress perhaps - medical issues, divorce, death of a spouse or loved one, financial stress or facing foreclosure. It could be someone who has to relocate quickly for family issues or other life changes. Perhaps someone moving into a nursing home or assisted living. or a landlord tired of dealing with tenants, evictions, code enforcement, or city regulations.
Perhaps the property is distressed, and the homeowner does not have the resources to make the needed repairs. All of these situations create motivation.
In my case, I am looking for commercially-zoned property that can be developed within the city of Seattle. So I want wholesalers to bring me off-market properties that have commercial zoning. Savvy wholesalers take orders from buyers like me to find properties for us.
So how do wholesalers find these kinds of properties and sellers? It helps to know what type of seller or property the Buyer wants. It should be as specific as possible. Then find a source for getting property addresses, homeowner names and phone numbers, if possible. If not, get addresses and go knock on doors.
Where do you get these lists? Title companies are one good source, particularly if you plan to steer business to them when you do get some deals. Another good source is anyone who peddles data and information lists. ListSource is one of the most popular sources for real estate investors (www.listsource.com).
Internet ads may also be a good way to target leads, through Craigslist or social media. Many real estate investment trainers provide education on best ways to do this at minimal cost. A good google search may help you do this research on your own.
Unless you can figure out how to find properties off-market, you will not succeed as a wholesaler. Make this your priority in pursuing this approach to real estate investing.