For the savvy real estate investor, finding off-market listings can be a great way to maximize the profits in their investment. In this article, we will go through the different ways you can find off-market properties in Texas.
But first, let us define an off-market property.
What is an off-market property?
An off-market property is a property that is for sale but is unlisted in the MLS or Multiple Listing Services. Also referred to as “pocket listings”, these properties are intended to be shared only to a limited number of potential buyers. Though hard to come by and requires some legwork, off-market property search can result to lucrative deals if done right.
What are the benefits of off-market listings?
Off-market deals often sell for much lower than deals listed in MLS. Without agent’s fees required, sellers are more likely to ask for a lower price. As a buyer, you will also be able to enjoy less competition than with properties that are listed in MLS which would also be listed in popular sites that source their listings in MLS. And of course, fewer competition =lower sale prices.
Having access to off-market deals will give you more opportunities in your investment property search.
For the sellers, off-market properties can give them various benefits such as privacy, speed of closing, flexibility in the sale, and in the case where there are tenants, off-market listing can avoid disturbing the current occupants.
Are off-market deals allowed?
The National Association of Realtors (NAR) in 2020, implemented the MLS Clear Cooperation Policy (read about it here) which requires agents to post a listing in the MLS within one business day after the listing is marketed to the public. This could be a yard post or an online post. However, sellers may still direct agents to make a listing as an “office exclusive” which means the agent can pass information about the sale without publicizing it or putting it up in the MLS.
How to find off-market homes for sale in Texas?
1. Join networking events
Real estate investing requires a lot of networking. This is why it is crucial for real estate investors to join networking events and get to know face-to-face people in the industry that you can build relationships with and will eventually trust you enough to know what you are looking for in the market, and in turn, refer deals to you.
Networking becomes easier the more you put yourself out there, so don’t be afraid to scour real estate events in Facebook, bulletin boards, or your local real estate groups. These events will be a great way for you to build a network that would be beneficial for you in the long run.
Longleaf Lending regularly joins with other industry partners to conduct Happy Hour networking events. Subscribe to our mailing list to get up to date with upcoming events where you can meet the Longleaf Lending team and form relationships with other real estate investors, wholesalers, and other useful connections.
2. Get in Touch with Local Wholesalers
In relation to number 1 in the list, professional wholesalers are an incredibly important resource for real estate investors. These wholesalers spend thousands of dollars and effort in marketing to off-market sellers through direct mail, calling, texting, or even door knocking to homeowners.
Make it a point to follow and subscribe to local wholesalers’ mailing lists to be in the forefront of off-market deals that they may release to their network.
3. Reach out to Real Estate Agents
Real estate agents can be just as savvy with off-market deals just as with MLS listings. If you are interested in a particular area, contact a realtor who is familiar with that market.
Try to reach out by phone or email and ask for any off-market listings they may be aware of. Also keep in mind that even if the particular real estate agent cannot help you as of the moment, it does not mean that they won’t be able to do so in the future. Leave your details with them and ask to check back on you should there be available information soon about real estate deals.
4. Get to know Builders and Contractors
Aside from wholesalers and real estate agents, builders and contractors can be a good source of information for off-market deals as they are often “in the know” of pocket listings by being in constant contact with people in the business.
Let builders and contractors know you are looking for off-market properties and strive to build their trust and confidence.
5. “Driving for Dollars”
As the name implies, Driving for Dollars is a method where you literally drive around the neighborhood looking for distressed properties to buy. Look out for potential deals by keeping an eye out for overgrown hedges, unkempt yards, boarded up windows.
List down the potential addresses then search for the owners of potentially vacant homes in county records using the addresses you wrote down. Once you get in touch with the owners, inquire about the status of the home to know if it is for sale by owner and maybe then you can get the conversation started.
While time-consuming, Driving for Dollars is a practical and free strategy you can employ in searching for off-market properties.
6. Word of Mouth
It pays to treat every person you meet as a possible source of lead. Just because they are not in the real estate industry does not mean they cannot be a potential source of information for off-market properties.
Do not be afraid to broach the topic of your search for off-market properties with people you talk to. Once you begin to practice word-of-mouth marketing, it becomes easier and more and more natural for you.
Have you found a property that you need financing for? Reach out to us at Longleaf Lending. We can fund in as fast as 2 days. Give us a call at 979-200-2823 or apply for pre-approval here.