Investor’s Basics Series: The details on buying off market
You have the timeline to plan for your next property purchase, now you can decide if it’s worth it to try and get properties that are off market.
Keep reading to get the details on how to find properties off the market and the pros and cons of doing so.
There are many reasons sellers will look to sell off the market, including privacy, flexibility, speed and tenants, so there are many options for you to choose a good property from. Of course, with it may come some good and some bad things:
- You get access to an inventory that other investors haven’t seen – Less competition means more chance of getting the property you have your eyes on.
- The process may be faster – Some owners will look to sell off-market because they need a speedy exit, so everything will most likely go faster than usual.
- Negotiations may be more flexible – Without the pressure of a normal bidding war you may have more room to negotiate to get the deal you want.
- The cost of repairs may be high – Some properties are sold this way because they are not in the best conditions, so getting it ready to rent may be more expensive.
- Determining fair market value may be tricky – Since they are available to less buyers, these properties may be more difficult to appraise. You can do a Comparative Market Analysis (CMA) to help you out.
Some ways you can find off the market properties are:
Use marketing tools to find potential sellers
We have said it before, marketing is a great tool for real estate investors. From direct mail marketing campaigns to offline strategies, you just need to work out the strategy that works for you and let it help you grow your portfolio!
Connect with local vendors
Don’t underestimate the power of having good rapport with your local vendor community. Consider making a good relationship with maintenance professionals, gardeners, home inspectors, etc, they may be able to notice distressed or abandoned properties, and could help you make connections with different owners.
Remember you can always enlist the help of an experienced property management professional in case you have bought a house off-market and are looking to get it ready and rent it out quickly!