How to Buy Unwanted Land and SFRs (for immediate wholesale)

In 1999 I purchased 80 acres in Northern Arizona on eBay, improved its online presentation with better maps, pictures, video and more accurate information and resold it for twice what I paid 30 days later.

Fast forward to early 2018; we have completed more than 15,000 land and house acquisitions and resales generating tens of millions of dollars. All without leaving our offices in Scottsdale, AZ.

How we did it.

For every 3,000 offers we mail to SFR owners, we buy a house and make about $25K wholesale (never lift a hammer). For every 300 offers we mail to land owners, we buy one and generate about $5K net.

You locate a seller, not a property.

Even the most seasoned acquisition professionals miss this point; it’s not about the real estate itself, it’s about solving the seller’s immediate situation. Maybe they have an immediate need for money or need to relocate to care for a family member or they no longer wish to be a landlord or pay property taxes or clean out the garage or get the house ready “to show” to prospective buyers.

There are 150M properties in 3,144 counties in the US. About 50% of all houses have no mortgage as well as about 95% of all parcels of land. Every year (sometimes twice a year) the owners of these properties receive a tax bill in the mail that most can’t afford or don’t want to pay or simply have a better use for the money. That’s a whole lot of unwanted equity for someone to collect who is organized, methodical, and patient. And being good a math really helps.

Not Back Tax Property.

I’m not refereeing to “property associated with back taxes” or “back tax property.” This type of property usually carries many other obstacles with it other than back taxes the most prevalent of which is the death of the owner. Undoing these problems toward the path of your ownership and equitable sale is almost always not worth the work involved.

“Do this, not that” short list of way to locate buyers:

Do this:

Send offers to owners who do not have a mortgage, by the ton. The offer must be addressed to the actual owner, contain a dollar purchase price amount and a closing date with a time frame in which they will get their cash problem free.

The owners who are interested will call you back. Not the other way around. When you send an offer to an owner with a price that is acceptable to you, you’ve completed 90% of the due diligence on the property in bulk already. Saves you tons of time and money. It’s scalable.

When an owner responds to your interest to buy any other way, you need to assess the deal, negotiate a price, complete due diligence and purchase and resell the property. This process is not scalable and requires too much time and resources to allow you to create an acceptable amount of equity in a timely manner.

It’s easier, faster and more efficient to go to your mail box every day, collect signed offers, assess which ones you want to buy and complete the deal.

Don’t do this:

Place bandit signs, drive for dollars, put up web portals, comb expired MLS listings, explore Probate, talk with whining real estate agents, cold call or pound the pavement or utilize many other “strategies” that waste time. These concepts are popular with new people because they are largely free or cheap cost but prohibitively expensive in missed opportunity.

I’ve seen thousands of intelligent and capable real estate investors give up on the entire real estate business due to failing at driving for dollars for 3 months or renovating a house at a loss because it was purchased for too much out of the MLS.

Data Power.

Learn about data from Corelogic’s RealQuest Pro, Black Knight’s TitlePro 24/7, First American’s DataTree (we are licensed providers of all three) and learn the basics of a mail merge on YouTube.

Whether you are a seasoned professional real estate acquisition professional or brand new, move your way toward getting that first direct offer campaign in the mail.