Have you done much direct to seller marketing? This scenario might sound familiar if you have.
Maybe you drive for dollars, cherry pick the best properties off a tax delinquent list, find an awesome probate deal that has tons of equity, or use some other method to locate properties that check every single box.
Once you’ve found a perfect property, you’re excited! You start your postcard mailing campaign, or skip trace to find a few phone numbers and try to contact the owner, or perhaps you even leave a flyer taped to the front door.
Then… nothing happens. Silence. Crickets. No contract signed or deal closing.
What do you do now?
How to Invest in Real Estate While Working a Full-Time Job
Many investors think that they need to quit their job to get started in real estate. Not true! Many investors successfully build large portfolios over the years while enjoying the stability of their full-time job. If that’s something you are interested in, then this investor’s story of how he built a real estate business while keeping his 9-5 might be helpful.
Why Hard-to-Find Real Estate Deals Can Payoff Big
Do you have a process to dive deep into the depths of real estate and ownership data in order to track down property owners?
Most investors aren’t going to push past initial barriers. They are focused on volume and will simply move on to the next deal.
But when the market is hot, good deals are fewer and farther between. And that means those that are more difficult to locate might just be the best out there.
How to Dig Deep in Data to Discover Hidden Deals
If the vast majority of competition is eliminated before making contact with the owner, there’s seemingly potential for home run deals.
When thinking about going after these deals, I wanted to come up with a scalable process. The process needed to be one that wasn’t too time-consuming but could help me track down owners, friends, acquaintances, or perhaps possible past owners, who may be able to put me in touch with a current contact.
I would then use acquired addresses, phone numbers, and emails to launch a second-round marketing campaign.
I spoke to private investigators who could do this kind of work but was quoted bids of over $100 per address to begin these searches. If I could be sure to close the deal, this would amount to pennies on the dollar of the potential profit margin. But closing wouldn’t be guaranteed, and it was still a lot more than I wanted to spend.
I determined an economical solution would be to find an effective data aggregation tool. These types of tools pull in lots of different types of data from several databases and organize all of it in a usable fashion.
I wanted something that pulled in family and ownership records, death certificates, employment information, and then layered that with county appraisal district and deed records.
Then, I sought out a skip tracing (or contact information) aggregator to pull in lots of additional information I could use to get in touch with friends and family members of missing owners.
Once You Have the Data, Here’s How to Market
Once I’d gathered sufficient contact information, I developed an efficient method to reach out to these people, largely through ringless voicemail drops or text or email campaigns.
The goal of these marketing touches was to figure out which numbers and emails were getting through to people. Then, I set up a phone call to explain what I’m working on and offer them a bonus of some sort if they are willing to help connect me with the owner.
Casting a wide net like this is the best way eventually find the decision maker and begin closing what others perceive to be un-closeable.
Is it a worthwhile use of time? It depends on your current deal flow and where you are in the evolution of your business.
Do you have more time or money? Can you use this as a pitch or “value-add” to bigger investors or wholesalers to help them track down hard-to-find owners?
If you’re willing to do the legwork and coordinate the moving parts, this can be a very valuable skill or service. It’s definitely not the easiest or most straightforward way to locate a deal, but if it was, everyone would know about it!
If you’ve driven by the same falling down house on a prominent street every day for the past year, maybe it’s time to start digging and figure out the story behind the dilapidation. Even if the owners aren’t willing to sell now, you could be first in line when the situation changes.
When a Difficult-to-Find Deal Goes Right
I’ll leave you with a personal testimony about the value of digging deeper into the data.
I recently purchased land for a small infill residential development. There are two pieces of vacant land behind and beside my lot. I used my data aggregation tool to track down numbers and ownership details.
Both owners initially said they weren’t interested in selling. However, during a follow-up touch I spoke with one for 20 minutes. We discussed several options and strategies, including selling the land outright to me, partnering on a development, or using the equity in the land to finance construction.
When chatting, the owner even said, “I’ve owned this land for almost 10 years now and received countless post cards, but you’re the first person to track down my number and call me!”
At this point, I’ve sent over an offer and plan to keep working on it until I’ve closed the deal or the owner decides to go a different direction.
Competition beaten, and hopefully another deal closed!
What deters you from pursuing deals? Any methods of locating difficult-t0-find deals (that you’re willing to share!)?
Let’s talk about it in the comments.