Sourcing Real Estate Deals

There is a low supply of properties available, and a high demand for those properties. Retail buyers and investors alike are yearning for additional deals, whether it be to reside in those properties as a primary residence or place capital. For an investor, widening your deal funnel is key. The more deals you see, the more deals you underwrite, and the more deals you offer on, and - hopefully - acquire.

Here are some methods to identify deals:

1. 1. On-market deals

The most obvious way to source deals is through the MLS, Zillow, Redfin, and other public listing services. Most deals trade on-market. Because of the ease of sourcing these deals, they are, typically, more expensive than other deals.

1. 2. Broker relationships

Many commercial properties trade off-market amongst brokers. Having strong relationships with a network of brokers increases your chances of gaining access to these deals. Brokers can take these deals to any investor, so generally give preference, or the first look, to seasoned investors who have proven that they can close the deal.

1. 3. Wholesalers

Wholesalers source off-market properties, place them under contract, and then assign their contractual interests in the properties to end-buyers for a fee. The end-buyer, usually an investor, essentially steps into the shoes of the wholesaler and closes the sale of the property.

1. 4. Social media

Whether it be wholesalers or property owners themselves, some deals find themselves on social media outlets such as Facebook, Facebook Marketplace, and, believe it or not, Craigslist.

1. 5. Direct to Owner

The most time-consuming, but potentially most rewarding, way to source deals is to market direct to owner. This can include cold calling, direct mailing, or other advertising campaigns targeting a specific class of owners. Common campaign targets are, for example, out of state owners. Investors can also purchase lists of “leads” and market to them directly.

Finding deals is difficult, particularly with a low level of supply available. What creative methods are you using to source deals?