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Updated over 5 years ago, 04/03/2019
Is Craigslist a Legit Option?
So I have a few methods I'm trying for finding investment properties. My HELOC was just approved and processed last week but I've been actively looking the past few months.
Method 1
I look online at Realtor.com, Zillow, FSBO, foreclosures websites, etc. Obviously not the best method but better than nothing.
Method 2
I had a realtor set me up on their MLS auto mailer. So whenever a property that meets my criteria is posted on the MLS I get an email.
Method 3
I downloaded an app that links Craigslist to a GMAIL account. Much like method 2... I set my criteria and whenever something is posted that meets that criteria I get an email with a link to the post.
Anyone ever have any luck with Craigslist? I am finding two things. One is that there are wholesalers listing properties they don’t even have under contract. Second it seems like some people are placing fake listings to obtain contact information for potential buyers. Things move fast in this business so I don’t want to waste time chasing deals that might not even exist. Is Craigslist worth effort?
@Chris Taylor just work from the assumption that everything on craigslist is a scam, and you'll be fine.
What type of investments are you looking to make?
@Chris Taylor I used CL for quite a while to generate retail buyer leads. While I did a couple of deals over the last 5 years from CL, what I found was that most so-called buyers were not sufficiently motivated to follow through.
In fact, I sent close to 50 of them to NACA for a no down payment home loan with no closing costs - all at a below-market interest rate.
They had to do two simple things. Take a free workshop and then talk to a counselor. Three did the workshop and none went on to the counselor.
I spent on average 30-45 minutes with each of these people and got next to nothing in return.
On top of that, CL is stocked to the gills with scammers, wholesalers who are illegally marketing properties - often daisy-chained (trying to mark up another wholesaler's deal) and clueless wanna-bees, all of whom eat an enormous amount of time.
I finally pulled the plug on CL completely with the exception of posting a listing that I have for sale. That's not especially productive, but only takes a couple of minutes.
But if you're looking to buy a stolen iPhone, there's probably no better place on the planet.
@Jason D.
Thanks for the reply. Most definitely keeping that mindset when looking on Craigslist even when it’s not for real estate. Just getting frustrated with the number of people I contact and they don’t ever respond once they get your number and email.
Until I get established I think the BRRRR strategy is the best option so I can force some equity and get my initial investment back and repeat. Yeah I know ... yawn ... so says every newbie... lol. Looking for buy and hold rentals under $100k. SFH all the way up to a quad. I bet you've never heard that before ....
@Chris Taylor that's what I did to get started as well. I had a great realtor that knew the area very well and could give me great insight on wheeler thing were headed. I've done 2 BRRRRs, both purchased off the MLS, so dont get discouraged, they're out there. Good luck!
@Charlie MacPherson
Thanks for the insight. I definitely can see there are a lot of scammers or wannabe wholesalers. I have talked to a few legit people so you’re definitely right with what you are saying. Since I get emails with links to the posts I literally have no time into it other than the initial set up. I just need to be more selective with who I contact. For example if you can’t even provide pictures or an address then I probably shouldn’t waste my time contacting you (Craigslist posters not you...lol).
@Jason D.
Thank you and good luck to you on your future deals! I contacted a few realtors who specialize in foreclosures and short sales so hopefully between all of that I will find something in the next few months. I hear one of the hardest parts is staying focused and not getting discouraged. I’m patiently looking ...
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Originally posted by @Chris Taylor:
So I have a few methods I'm trying for finding investment properties. My HELOC was just approved and processed last week but I've been actively looking the past few months.
Method 1
I look online at Realtor.com, Zillow, FSBO, foreclosures websites, etc. Obviously not the best method but better than nothing.
Method 2
I had a realtor set me up on their MLS auto mailer. So whenever a property that meets my criteria is posted on the MLS I get an email.
Method 3
I downloaded an app that links Craigslist to a GMAIL account. Much like method 2... I set my criteria and whenever something is posted that meets that criteria I get an email with a link to the post.
Anyone ever have any luck with Craigslist? I am finding two things. One is that there are wholesalers listing properties they don’t even have under contract. Second it seems like some people are placing fake listings to obtain contact information for potential buyers. Things move fast in this business so I don’t want to waste time chasing deals that might not even exist. Is Craigslist worth effort?
You can get lucky on Craigslist every now & again but it ain't without work. For the most part Craigslist is riffled with scum bags, wanna be wholesalers with no idea what is going on and just overall insanity. It's like the wild west of low quality people. If you want to truly search for the deals you need to reach motivated sellers before anyone else & that is going to cost a lot of money. Me for instance I spend over $1M per year finding these people. It's hard to compete with a machine like that, ya know.
@James Wise
For sure. Even if I am able to reach those people I don't have the resources, capital or expertise to compete with the big dogs. I thought about direct mail using ListSource but haven't pulled the trigger. Right now I'm just trying to plant a bunch of seeds hoping one of them grows into a tree. Hoping one slips through the cracks eventually. I'm not trying to reinvent the wheel just trying to copy those who use the wheel in the most efficient way. I've been in contact with you but I have never approached you on a deal because my HELOC just closed last week and I didn't want to waste your time. I could buy something under $50k for cash but would be fully extended which I'm not sure if I want to do that. Next step is a getting a pre-approval so I know my buying power beyond what my HELOC will cover. I have 3 or 4 possible partners that would increase buying power but I want to see where I'm at on my own first. I'm sure you'll be hearing from me once I get that figured out.
All the Craigslist haters! LOL.
Yea, it's the wild west, which is why I love it. It's the internet rummage sale and you will find anything and everything on it. Reminds me of BP.
My favorite is to post something I need taken away, and like magic people come and get it. I have seriously gotten rid of piles of rocks on it.
I've sold sooo much crap I no longer want on it. I've bought an item or two. Scored a great deal on a bass amp.
For RE leads? I dunno...I haven't stepped up to the volume/transaction game yet. I suspect they are in there to be found.
As an appraiser, I source it all the time for rental data. As a landlord, I post rentals there.
Craigslist is the original and I'm no hater. Still have not seen one ad on it or paid a penny to use it. And still wonder how the heck Craig makes any money - lol. But, I suppose if I understood how he does it, I wouldn't be putzing around with real estate.
Originally posted by @Chris Taylor:
@James Wise
For sure. Even if I am able to reach those people I don't have the resources, capital or expertise to compete with the big dogs. I thought about direct mail using ListSource but haven't pulled the trigger. Right now I'm just trying to plant a bunch of seeds hoping one of them grows into a tree. Hoping one slips through the cracks eventually. I'm not trying to reinvent the wheel just trying to copy those who use the wheel in the most efficient way. I've been in contact with you but I have never approached you on a deal because my HELOC just closed last week and I didn't want to waste your time. I could buy something under $50k for cash but would be fully extended which I'm not sure if I want to do that. Next step is a getting a pre-approval so I know my buying power beyond what my HELOC will cover. I have 3 or 4 possible partners that would increase buying power but I want to see where I'm at on my own first. I'm sure you'll be hearing from me once I get that figured out.
Right on. Get your ducks in a row. Circle the landscape. Put some baits out and see what happens. Be ready to strike in your own good time. Too many rush right into this without taking a second to size up the battle field.
@Chris Taylor You have listed 3 good options for finding property. However you don't have any plan in place to get Off-Market Leads. The people you are learning about have already taken all the steps to put their house on the market - re-decorating, fixing problems and all the cleaning up needed to be ready for showing.
You can do a mail campaign to get in touch with people who share characteristics with homeowners ready to sell.
Lists to consider are Absentee Owner with Equity, Seniors with Long-time Ownership and Owners with Low Financial Stability Scores (FSS)
Sending letters or post cards will be more expensive than your current avenues, but you can talk to them about how easy you will make it for them to sell their house to you.
@May Emery
You’re right I do have to try off market as well. I have a list saved on ListSource but haven’t made the purchase. That is going to be my 4th method even if it’s just 1,000 people. It’s a numbers game.
@Chris Taylor, I just read in Ryan Pineda's book 'Flip Your Future' that many of the wholesaler courses point newbie wholesalers to Craigslist. Some are told to post fake deals in order to lure investors to build a buyers list. Ryan suggests that you reach out to these people without really expecting anything in return. It sounds like a long term play. If the wholesaler starts to become successful and acquires actual, real life deals, they will have your name and may reach out.
@Benjamin Ross
Now that’s something I didn’t consider. And I may have to pull back. I was a little abrasive with a couple folks who keep posting properties but never follow up once they get my contact information. I wasn’t at first but after a few times it started to irritate me.
@Merritt S.
No doubt. I guess I liken it to picking up women. You have to get told no 10 times before you get a yes.
@Merritt S.
I just noticed your post about Craigslist making money. It’s funny because about a year ago it came up in a conversation and I had always assumed they made money by selling information on their users. So I asked Google to see if that assertion was correct. I guess there are a hand full of major Cities where they charge a fee for posting jobs, rentals, etc. This supposedly covers their operating expenses and the company technically makes no profit. But if you are an employee of said company you can pay yourself whatever you want. So you are making money as an employee but the company is not. I guess they only have 12 employees. But yes for the majority people, most if not all the posts are free of charge.
@Chris Taylor. I have found a few deals on Craigslist but not many. Have you look at any of your local real estate clubs or meetups. We have a local Creia group that has produced a lot of deals and a lot of good relationships with wholesalers. You can see if bigger pockets has any local meetups in your area or google Creia groups for your area. Hope that helps and good luck.
Best option is to not rule anywhere out completely when looking for deals. I did recently find one successful BRRRR from craigslist. Also, regardless of using multiple listing to find renters, my latest tenant came from a craigslist ad - for a more expensive SFH in a B+ neighborhood.
@Chris Taylor I know investors that have found and purchased properties off of Craigslist. I do not personally spend my time in there but.... like anything when looking for deals, unless you have a great source you will need multiple avenues and a lot of volume.
It's not crazy to think a FSBO could have a good deal and would start by listing on Craigslist.
- Matthew Irish-Jones
@Chris Taylor I use CL a good bit, and have found some great properties through the site. I’ve also wasted a lot of time with non-motivated sellers.
It gets easier to snuff out the “time wasting posts” with experience, just be prepared to have some very uneducated conversations and have people waste your time at first. I say it’s a good source though if used correctly
@John Hovanec
Yes there are sone local meetups I checked recently. I plan on attending the next one that comes up. I also reached out to a local investor near me through BiggerPockets and will hopefully be grabbing lunch with him soon.
@Cameron Maxey
Yeah I’m going through exactly what you described.
@Chris Taylor
What was the app to send Craigslist ads to your email?
@Chris Taylor one thing that works for me: I use a stock email that I send for first contact and I tailor slightly for each property. If their answer raises any suspicion of a scam or someone who might waste time - my response to them includes a good bit of real estate slang instead of using common terms. I’ve found that scams or those who are just putting it out for attention will not answer.
You can’t avoid it though Chris, just embrace it and use that time to get a good laugh in.
@Dale Nesmith
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