For wholesalers, BRRRR‘rs, flippers, and buy-and-holders, off-market properties are like veins of gold.
You either know where to find them or you don’t.
If you don’t, that means you’re depending on deals found through the MLS… which massively limits your deal-flow potential.
In this guide, we’re going to explain what off-market properties are and why they’re so important for real estate investors. Then we’ll show you 10 easy ways to find them in any market.
Let’s dive right in.
What are off-market properties?
In real estate, off-market properties refers to properties where the homeowner is interested in selling, but their home isn’t listed on the MLS. In most cases, the property hasn’t been listed because the home or its owner is in distress (bad tenants, lots of repairs needed, divorce, bankruptcy, etc.).
This means it’s a good opportunity for real estate investors.
Because the owner is motivated to sell (meaning they’ll consider a low-ball offer)… but most people (i.e. those who don’t know how to find off-market properties) are completely unaware of the opportunity because it’s not listed on the MLS.
The best real estate investors don’t just know how to find off-market properties, they invest marketing budget every month to do so. This creates a consistent deal flow that props up their business and keeps the investment opportunities coming.
Here are 10 easy ways.
1. Hand-Written Direct Mail
For finding off-market properties, direct mail is probably the most popular method.
In fact, 7 out of the 10 guides that pop up when you search for “how to find off-market properties” in Google include direct mail marketing as a tip.
There’s a good reason for that (heck, it’s where we’ve laid our chips here at Ballpoint Marketing).
To get the phone ringing with quality leads and for creating a consistent and predictable lead flow, nothing is quite as effective or to the point as direct mail. Anyone can pull a list from Propstream (more on this in the next point), send some mailers for a few thousand dollars, and generate leads.
Of course, the type of mailers you send makes a big difference.
Because the one downside to direct mail marketing for investors is… it’s competitive.
Everyone is doing it. To stand out, you can use Ballpoint Marketing to send hand-written (by robots with real pen and ink!) mailers.
These mailers (for obvious reasons) get record-high response rates — you can see tons of testimonials from investors all around the nation who are using these to find off-market deals. Here’s just one…
“We’ve actually had to slow down because we’ve gotten more leads than we have time to handle … We’ve had multiple people tell us that they get hundreds of letters but reached out to us because ours was hand written!”
– Travis & Hunter, New Haus Properties
This is the best way we know of to consistently and predictably find off-market deals without getting lost amongst the ocean of bland and boring yellow letters and postcards that other cash-offer investors are sending.
Additionally, if you use our mailers, we’ll ship them straight to you so you can get a local postmark to ensure that your prospects feel like someone in their community is interested in them and not someone mailing them from across the world.
Our postcard process is a bit different and we’ll dropship those directly to your uploaded list.
2. Niche Marketing Lists
After that last section, if you’re new to finding off-market properties then you’re probably wondering…
Who the heck am I supposed to mail?
You could just send mail to a certain number of people in the zipcode where you operate.
You’ll waste a ton of money if you do that.
Instead, you want to send more targeted direct mail campaigns.
Remember that off-market properties are typically owned by people who are in distressful situations — bad tenants, lots of repairs needed, divorce, bankruptcy, etc. (which is why they haven’t listed on the MLS).
Fortunately, there’s an easy way to only send your direct mail campaign to people who fall into those “distressed” categories.
You’ll need a Propstream account to pull the data (they have a 7-day free trial and then $99 per month).
Here are some of the niche lists you can target once you have an account…
- High Equity + Absentee + Vacant — Absentee owners don’t live in their property and a vacant property means no one is living it. This means that the owner is losing money on their real estate investment. And high equity means they have a lot invested in the property. For obvious reasons, these people are often willing to sell their property for a fair cash price to get rid of the headache of managing the property.
- Tax Delinquent — Tax delinquent lists are one of the most commonly used list types in real estate. They’re easy to pull and, if you market to them correctly, can be quite effective. The logic is simple: If somebody isn’t paying their property taxes, then they very well might view their property as a burden. And if they see their property as a financial burden, then they might be interested in quickly unloading it for below market value.
- Free & Clear — A lot of the lists we talk about here include an equity filter of 50% or more (because high-equity homeowners are often more interested in selling to wholesalers). But sometimes, you might want to just pull a list of people who own their property free and clear. These people, for a variety of reasons, might be interested in selling their home for a fair cash price. If you want to niche down the free & clear list even further, you can add absentee, vacant, or even tax delinquent filters.
To make this super easy for you, we’ve compiled the 10 best mailing lists for wholesalers here. In that article, we even show you exactly how to pull each list inside of your Propstream account, screenshots and all. Easy peasy.
3. Driving For Dollars + Door Hangers
Pulling lists and mailing lists is a great and easy strategy for finding off-market properties.
But maybe you want to branch out.
Maybe you want to find some deals that aren’t being bombarded by your competitors because they’re part of the data being pulled by every cash-offer investor in the area.
Maybe, instead, you want to find deals that really fly under the radar.
This is how you can do that: drive for dollars and use door hangers.
Driving for dollars is a term real estate investors use to describe the process of driving around your target investment neighborhoods, looking for distressed properties, writing down their addresses, and adding them to your marketing campaigns (usually, direct mail).
Spending just a few hours a week can help you find deals that other investors are totally missing out on.
Here’s how it works…
- Choose a neighborhood to drive around and use Deal Machine to track your routes (otherwise things will start getting messy). Set a schedule and try to spend at least two hours per week driving around your target neighborhoods.
- During your drives, write down every address that looks like it might be a property in distress. You’re looking for unkempt lawns, broken windows, cracked driveways, disheveled roofs, and other typical signs that a property isn’t in good shape. If you write down the address, also take 5 extra seconds to get out of the car and place one of our hand-written door hangers on their door.
- When you get home, add those addresses to your direct mailing campaigns. Now you’re marketing to potential deals that other investors have no idea even exist.
If you take action on the first three tips in this article, but neglect to follow up, then I’ve got bad news.
You’re going to fail at this business.
Plain and simple.
As Ryan Dossey, our founder and a successful real estate investor, has said multiple times: 90% of deals happen during the follow-up process.
When you’re making lowball offers to people with distressed properties. it’s normal that it takes a little bit of extra time, follow-up, and consideration to close the deal. For Ryan, some of his deals take between 3 months to 12 months to close… but that’s because he’s always working his leads!
Here are just a few examples of the text messages he sends during his follow-up process (he automates this process with RESimpli — you can get 10% off with the code: CCCF)…
Sent October 17th — I’m sure you’ve gotten a lot of calls by now on the home you took off the market and I just wanted to ask if selling this was still a goal fo you in 2022?
Sent October 18th — From my call and texts the other day, I am not here to convince you to do anything you don’t want to do, but I specialize in properties that didn’t sell the first time. When would be a good time to talk for 5 minutes so I can hear about your real estate goals and see if I can help you get there?
Sent October 19th — Are you still looking to sell your property if you got the right price for it?
Sent October 20th — I sent you a text yesterday. I’d love to talk about a plan for when would be smart for you to list your home. Let’s talk about when works for you to list your home on the market so we can get you the highest price, best terms, and fastest close time possible.
Those texts were sent one after another, but he continues to follow up (albeit less often) for months after the first contact.
You’re paying for your leads. Don’t let them go to waste.
Create automation to keep working your leads for months after the first contact so that you’re not letting your leads fall through the cracks.
If you stopped reading here, you’d be in good shape.
The first four tips are — by far — the easiest, best, and most straightforward ways to find off-market properties. It’s exactly how thousands of investors we work with around the nation are pulling deals and building successful businesses.
But if you want some additional ideas (maybe you’re already doing the first two things), then the rest of this article is for you!
Next up is contractors.
Contractors and builders are a potential source of deals because they are regularly interacting with and giving quotes to homeowners who need repairs done on their homes.
At least some of those homeowners, after they hear the contractor’s quote, have a property they’d rather sell outright than spend massive amounts of money to repair. In that instance, it makes the contractor look good (and might even make them some money if you offer a referral commission) for them to refer the homeowner to you for a cash offer.
It’s worth your time to reach out to the most popular contractors in your area and get to know them. Who knows what off-market deals they might be able to pass your way?
Richard Branson once said, “Free publicity and word of mouth is probably the best and cheapest form of advertising. Learn to use it to your advantage.”
If homeowners tell their friends and family about how you helped them, or if they share your services with a person who owns a distressed property, that’s going to drive free, unexpected investment opportunities to your business.
Of course, word-of-mouth is a little ephemeral.
It’s difficult to put a finger on how, exactly, a real estate investing business can build word-of-mouth — beyond just marketing and doing right by homeowners.
But here are some ideas…
- Door Knocking — Door knocking in the neighborhoods where you operate might be uncomfortable, but it’s very effective for meeting new people and introducing them to what you do. You don’t have to be pushy. Just knock, introduce yourself, tell them what you do, and give them your business card.
- Frequent Local Spots — Find a few coffee shops or coworking spaces to visit regularly. Over time, you’ll get to know the workers as well as some other regulars. If those people know what you do and who you are, they might tell other people about you when it’s relevant.
- Brand Stuff — It’s sort of cheesy, but it works. The more that people see your “we buy houses for cash” logo or brand name, the easier they’re going to remember you when they or their friends need to sell quickly. You can wear branded clothing, put your logo and phone number on your truck, or use signage where it’s appropriate.
- Attend Local Meetups & Events — It’s also a good idea to attend local events (like holiday markets, sports events, etc.) and meetups (real estate meetups, entrepreneur meetups, etc.). These are great ways to build relationships with people in the community and show people that you’re a real part of the community.
7. Real Estate Agents
Real estate agents probably aren’t the first people you think of when you think about off-market properties.
After all, they literally specialize in on-market deals.
Still, real estate agents in general come across a lot of properties and opportunities, some of which are distressed and won’t sell well on the MLS.
They might be willing to refer leads to you if they have a client who they know won’t be able to sell on the market (especially if you offer them a referral commission).
It’s worth having a few solid relationships with agents in your area and letting them know when you’re actively looking for deals.
How do you find investor-friendly real estate agents, though?
Here’s an awesome video from Ryan Dossey showing you exactly how to do that using your Propstream account…
8. Search Engine Optimization
You know what’s better than finding off-market properties?
Letting off-market property owners find you.
Search engine optimization (SEO) refers to the process of optimizing your website and its content so that it shows up in the top search results for the keywords related to your business.
If you want people to find you when they search, for example, for “sell my house fast,” then SEO is a great way to make sure you’re getting organic (aka free) leads from Google and other search engines.
How do you do this?
The easiest way we know of is getting a Carrot website. Their websites are specifically designed for real estate investors to convert traffic into leads and they all come pre-optimized to rank in Google.
They’ll even give you new content every month for your blog to give you more opportunities to rank for various phrases that motivated sellers are typing into Google.
Here’s what Ryan Dossey’s REI website, for instance, (which is built with Carrot) looks like…
9. Cold Calling
Cold calling is another great option for finding off-market deals.
It’s not for everyone and it takes a bit of practice, but it can be very effective.
There are a lot of details to cold calling that we don’t want to get into here, but you can check out our complete real estate cold calling guide here — it includes the tools, scripts, and tips you need to get started.
If you yourself are a wholesaler, then this tip doesn’t really apply to you.
But if you’re flipping homes or buy-and-whole investing, then working with high-quality wholesalers very well might make sense (especially if you don’t want the headache of finding your own deals).
Wholesalers are people who find off-market properties and flip the purchase agreement to other cash buyers (you) for an assignment fee — this means you’ll typically end up paying $5,000 to $15,000 more for the property than if you had found it yourself.
But, depending on the deal and what you plan to do with it, that might still be worth it.
You can find wholesalers in your market easily by searching for “we buy houses for cash in [your city]” in Google.
We’ve given you the farm.
But if you’re new to real estate investing, you might now be wondering what exactly you’re supposed to do if you actually find a deal…
The next good step would be figuring out how to estimate rehab costs accurately so that, when you find a deal, you know what you’re dealing with. We have a complete guide to estimating rehab costs here.
Go check it out!