How do I find distressed off market properties with motivated sellers?

Question

Hey BP members,

Foremost, thanks for taking the time to view this post! Any information you can provide for me is truly appreciated.

I am trying to comprise a formula to effectively find off market properties in the greater-Houston area. This formula should be effective in terms of time and money spent generating leads and it should be repeatable. With these leads I hope to find properties that I can fix and rent out or fix and flip. I am struggling to find distressed properties with motivated sellers and it has led me to waste a lot of time researching with no success.

How do you find distressed off market properties? Do you pick an area, drive around, and leave a business card at the front doors of distressed properties? Do you pay for leads? Do you use online tools to locate possible leads for you?

Again, any insight as to how you find distressed properties in your area would be appreciated.

Thank you BP members.

Edward Adams · Answer

There are several strategies you can use to find distressed off-market properties with motivated sellers. Here are a few ideas:

1. Direct Mail Campaigns: Consider launching a direct mail campaign targeting homeowners who are likely to be motivated sellers. You can purchase lists of distressed properties from various sources, including public records, and then send out mailers to these homeowners, expressing your interest in purchasing their property.

2. Online Marketing: Use online marketing techniques to reach potential sellers. You can create targeted ads on social media platforms like Facebook or Instagram to reach people who may be interested in selling their property. You can also optimize your website for search engines to attract motivated sellers who are actively searching for a solution.

3. Networking: Attend local real estate networking events or join online communities to connect with other real estate investors or professionals. These individuals may have knowledge of off-market properties or motivated sellers that they are willing to share.

4. Drive for Dollars: Driving around neighborhoods and looking for properties that appear vacant, rundown, or in need of repairs can help you identify potential distressed properties. Leave a business card or flyer with your contact information on the property to see if the owner is interested in selling.

5. Public Records: Look for properties with delinquent taxes, code violations, or liens. These may indicate that the owner is experiencing financial distress and may be open to selling their property.

6. Bandit Signs: Place signs in high-traffic areas, such as busy intersections or near distressed properties. Make sure to include your contact information and a brief message stating that you buy houses.

When using any of these strategies, it's important to be consistent and persistent. It may take time to find the right off-market property, but by staying focused and following a repeatable formula, you can increase your chances of success.

Blake Novotney · Answer

Whatever way you are willing to stick with and be consistent! You'll see tons of different ways, everyone has their favorite. My favorite "unusual" one is instead of driving for dollars, I get on my bike and make notes of addresses on my phone for properties that look distressed/interesting. Its much easier to get around at that pace compared to a car, and you're getting exercise!

Eliott Elias · Answer

What constitutes distress? Start here, foreclosures & water shut off properties.

Mohammed Rahman · Answer

Hey @Andrew Thomas Vedder - you've asked the $1B question. What's the secret formula to successfully finding distressed properties? Nobody knows.

Everything you've mentioned works, and doesn't work, at the same time.

You can get smarter if you have more access to capital and buy the leads from different vendors, but the trade off there is obviously your $$$

Ibrahim Hughes · Answer

@Nathan Gesner

Oh snap! How can you tell???

Ian Walsh · Answer

All of those forms of marketing work.  Establishing a farm area is always a good idea.  Marketing techniques all work. Some will hit at different times than others.  It's usually good to start with a few, be consistent with them and see what is working and what the cost is.

Marc Howard · Answer

Hey Andrew,

Totally get the struggle, finding distressed off-market properties can be a bit of a challenge. So basically, you'll want to try a combo of strategies to maximize your chances. I'm from Baltimore, but these tips should work in Houston too.

• -Driving for dollars: Yep, just drive around neighborhoods you're interested in, and make note of properties that look neglected or abandoned. Jot down the address, snap a pic, and try to connect with the owner. Leaving a card or a friendly note on the door might work too.
• -Direct mail campaigns: Target absentee owners or people who have owned their property for a long time. You can find lists of these folks through list providers or your local tax assessor's office.
• -Network with local real estate professionals: Connect with wholesalers, agents, and other investors who might have leads on distressed properties.
• -Use online tools: Websites like Zillow, Redfin, or even your local MLS can help you spot potential leads. Look for keywords like "needs work," "fixer-upper," or "cash only."

In a nutshell, mix and match these strategies and stay consistent. Don't forget to follow up with leads, as persistence is key. Lmk if you've tried any of these or if you have any other questions! Good luck, and happy hunting!

Have you joined any local real estate investor meetups or Facebook groups? Networking can be a game changer.

Nathan Gesner · Answer

Please do not use AI-generated content in the forums. We want information based on personal experience, written by the user.

How do I find distressed off market properties with motivated sellers?

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