By the time you’ve been investing in real estate for as long as I have, you know that the best deals are rarely advertised. But, if you’re just thinking about starting a real estate investing company, you might not realize the uphill battle you’ll soon face when it comes to getting quality leads. If you’ve already dipped your toe in the investing water, you know what I’m talking about. No matter what your investing experience may be, knowing how to find off-market properties to buy, renovate, and sell to will increase your chances of not just getting the lead, but converting it as well. After all, that’s why you’re here, right?

How to Find Off-market Properties to Buy, Renovate, and Sell

Off-market properties tend to make better investment deals for a few good reasons. First, there’s generally less competition from other investors and, increasingly, from owner-occupants. When a great fixer-upper is listed on the Multiple Listing Service (MLS) or on sites like Zillow, everyone notices. And, if you’re trying to build a real estate investment business in a competitive city, like New York or Austin, or where inventory might be experiencing a squeeze, it’s going to be that much harder to get, and keep, attention on your offer. Second, because there’s less competition, off-market properties can usually be purchased at a lower price point that’s still fair to the homeowner. Finally, negotiations can be easier and the timeline to closing faster when the communication pipeline isn’t clogged with multiple parties vying for the attention of the homeowner or their real estate agent.

Finding great investment properties that are off-market, however, can be a challenge. But, it’s certainly not impossible. Below are some of the more common strategies many investors use to find these great deals as well as one you may not have previously considered.

Lead Lists

Lead lists are one of the most frequently used strategies for finding off-market properties and for good reason. In addition to providing information on expired listings, these lists can contain details about homeowners in a variety of distressing situations that are likely driving a desperate need to sell fast. Examples include missed mortgage payments, foreclosure proceedings, divorce, death, and back taxes owed. And, these days, lead lists are customizable. So, you can cover as much, or as little, territory as you need with one list. Once the sole domain of real estate agents, you can also now skip buying from an agent and purchase the information you need directly from third-party vendors online.

Popularity isn’t everything, however—especially when it comes to lead-finding strategies. See, because lead lists are so easy to customize and buy, a lot of investors do—despite the fact that the info is often outdated. The unfortunate side effect is that the distressed homeowners on these lists usually get flooded with investor interest. The homeowner may find it annoying at best and it can feel downright invasive to them at worst. This makes for a high probability that your call will fall only deaf, or angry, ears.

Real Estate Agents

It’s important to develop and maintain good relationships with real estate agents since you will have to work with them when buying and/or selling your investment properties, but there’s another reason too. Many agents, especially if they’ve been in the business a while, get access to off-market properties that they, then, pitch to their investor contacts. Sometimes, they’ll even delay placing a new house on the market by a week or so in order to give the investors in their network first dibs. To get a crack at these properties, you can always request to be put on an agent’s mass email list. But, if you attempt to create a mutually-beneficial partnership by using them to handle your transactions, for example, you could increase the chances that they’ll prefer to pitch their deals to you.

The drawbacks to this strategy, however, mostly involve the element of time—a crucial consideration when you want buying, renovating, and selling houses for profit to be more than just a side gig. It takes time to build relationships and to gain the trust of your industry colleagues, including real estate agents. Even then, you’ll be hard-pressed to earn enough from one agent’s list of off-market properties to quickly build an investing career. You’ll have to take the time to build multiple personal relationships and, until then, be okay with being just another name on an email blast that’s also going to your competitors.

Investment Clubs

You can find real estate investment clubs in most major metropolitan areas and in their surrounding communities, and you can sometimes find off-market properties at them if you join. These clubs are typically made up of both new and experienced real estate investors who come together on weeknights or weekends to network, learn, and exchange ideas. Investment clubs are usually inexpensive to join and fairly easy to work into your schedule. Plus, these clubs tend to be open to all real estate industry professionals, including agents, builders, and attorneys, who may also have leads on properties that aren’t yet being advertised. Most clubs encourage members to bring their investment deals and off-market opportunities to the table.

Unfortunately, the advantages of joining an investment club don’t always outweigh the disadvantages. Most clubs meet too infrequently—only a handful of times a month or less—and have too few members to offer any real and lasting benefit to the investors who actually attend the meetings. Also, most club members tend to be new investors. New investors won’t have access to the kind, or the number, of good deals you need to boost your leads and your returns. So, you could end up feeling like you’re spinning your wheels when you should be out finding, and investing in, more properties.

Direct Marketing

Marketing to distressed homeowners directly is a great way to take control of your lead-finding efforts and improve your chances of acquiring off-market properties quickly. Postcards and flyers, online ads, billboards, radio spots, and television commercials are just some of the direct marketing tactics you can employ. And, each has the potential to reach a wide range of homeowners who may be thinking about selling their “ugly” house fast and with as little hassle as possible. Of course, if you can implement all of these strategies at the same time, you increase your odds significantly of getting good deals before anyone else grabs them.

But, direct marketing is expensive, time-consuming, and not immediately effective. Most investors don’t have access to the amount of funds needed to take full advantage of the various marketing strategies available. I’m betting that sounds like you. And, it takes time for ads to generate enough buzz to consistently draw in homeowners who are willing to trust you with their home and their distressing situation. When you’re trying to grow your real estate portfolio, however, simultaneously building a brand is gonna be tough and, unfortunately, something—like your patience—might have to give.

Out of all of the usual strategies, direct marketing is the one that gets you closest to finding distressed conversion-oriented leads. But, it can be high on cost and short on delivering if you don’t have a recognizable name or a strong and consistent presence in the community. There is one way to get around that, however, and it’s a valuable step in the right direction.

Getting Off-market Leads That Don’t Fall Short

Early on in my investing career, I tried a variety of tactics for getting leads on off-market properties. Yes, I bought lead lists, networked with real estate agents, and joined a few local investment clubs. None of them provided enough leads, however, to help me get a few good deals under my belt. And, I still had to deal with investor competition. What I really wanted to do was find a way to reach distressed homeowners directly and encourage them to come to me when they were ready. But, instead of trying to create my own comprehensive direct marketing campaign, I decided to turn to HomeVestors®.

As an independently owned and operated HomeVestors® franchisee, motivated sellers of distressed homes that aren’t yet on the market find me. Thanks to the nationally-known “We Buy Ugly Houses®” ad campaign, distressed homeowners know who to call because the solution to their “ugly situation” can be found on billboards, radio, and TV. It’s so effective, in fact, that franchisees have bought over 140,000 houses nationwide since 1996. The best part is that the only finger I had to lift to get access to this marketing campaign was when I picked up the phone to call for more information on becoming a HomeVestors® franchisee.

If you need a better way of finding off-market properties, consider becoming a HomeVestors® franchisee too. Call today and get more qualified leads!

Each franchise office is independently owned and operated.