MLS vs Off-Market?

Question

What are some of the pros and cons for finding property on MLS versus finding property off-market? I am a new investor and sometimes see properties off market that have been for some time and could potentially be a good market and possible deal. Just curious about risk/benefits involved with on vs. off market investing.

Eliott Elias · Answer

Buying from the MLS forces you to deal with realtors. A lot of realtors are difficult to deal with. Buying off market requires you to deal with either wholesalers or the sellers themselves. It requires a lot more of an understanding of how to purchase property if you are buying off market.

Justin Hammerle · Answer

@Sparkle Carlock - If on MLS you should either be first or last.  Off-Market you have higher probability of getting a deal due to less on eyes on it but its ofc more difficult to lock in owners.

Michael Glunk · Answer

Building on what @Trevor Schmitt has mentioned. Yes the general thought is that if it's off market you are getting it at a better deal and are avoiding fees. The reality is that this is not always the case and you can find some really amazing deals on the MLS. But definitely can be the case. Something to think about buying off-market is yes you can often get a better price (or make a deal happen that the owner wouldn't have agreed to because of many factors, one being they don't want to may realtor fees - a common one) but this doesn't mean you are getting a better deal. There often isn't anything regulating the transaction in most states when buying direct. So as a new investor, you need to keep that in mind. Essentially you are accepting the property as is. And if you are new, you may not know what to look into from a due diligence perspective.

Victor Annan · Answer

Pros with MLS listings

1. MLS listings typically offers a larger pool of properties to choose from giving you more options. 2. MLS also provides detailed information about the property, making it easier to compare properties and make informed decisions.

However, since many investors have access to the same listings, you might face more competition, potentially leading to higher prices.

Pros of Off market deals

1. Off market deals can sometimes be acquired at a better price since there’s often less competition.2. You have more direct communication with the seller, potentially allowing for more personalized negotiations.3. You may have access to properties that others don’t, giving you an edge in finding unique/exclusive investment opportunities.

On the flip side, you may encounter limited availability, lack of information or uncertainty in the negotiating a deal.

Ultimately, the best approach depends on your investment strategy, risk tolerance, and resources. Using a combination of both MLS and off-market strategies can help maximize your investment opportunities.

Bjorn Ahlblad · Answer

A deal is a deal and a dog is a dog regardless of where you find it. Know how to underwrite!

Trevor Schmitt · Answer

In theory, you can purchase off market properties at a discounted rate. You can avoid part or all of the realtor fees and avoid other competition to drive up the price. Other than that, your process and due diligence should be the same either way!

MLS vs Off-Market?

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