What Makes An Off Market Deal Worth Looking At?

Question

Hey everyone — newer member here trying to learn the fundamentals of finding deals that investors actually want.

For experienced investors — when a bird dog or wholesaler brings you an off market deal what are the first things you look at? What immediately makes you say yes or no to a lead?

Trying to understand what real value looks like from an investor's perspective. Thanks in advance.

Bo Smith · Answer

First thing I look at is the math in the OP's email. If they've done their homework, they'll give me the basics: property address, purchase price, estimated ARV (with the comp sources), and rehab estimate. If they're vague or leading with "you gotta see this property," I delete it. A serious wholesaler or bird dog respects my time.

Then it's all about margin. I'm flipping, so I need roughly 15-20% spread between my all-in acquisition cost (purchase + rehab + carrying + closing) and ARV. If that math doesn't work at the number they're asking, I'm not interested. I've trained my network to know my criteria (max price, preferred zip codes, minimum spread) so they're not wasting my time with long shots.

The third thing is contractor availability. You can have a perfect deal on paper, but if you can't get subs in to rehab it within 90-120 days, you're bleeding holding cost. I validate that before I even look at a property. If my contractors are slammed, I'm not taking new deals.

Last thing: is this a real off-market deal, or did the MLS listing price just come down? Real off-market usually means foreclosure, estate, or a motivated seller who never listed. That's where you find margin. Are you trying to build a bird dog network, or looking to wholesale yourself?

Adam Bartomeo · Answer

First - Price!

Second - Price!

Third - Price!

After the criterion for the first 3 is met I move on to rehab expenses and ARV. Wholesales ALWAY overestimate ARV.

Garrett Crosby · Answer

Bo nailed the flip-buyer perspective. I'll add the buy-and-hold lens since the criteria shifts a bit.

For a rental buy, what I'm looking at first is whether the price creates a rent-to-value ratio that actually cash flows after all expenses — not just the mortgage. A lot of off-market deals get presented as "deals" because they're below list price, but below list doesn't mean below what makes sense to hold. I want the rent to cover PITI, property management, insurance, taxes, capex reserve, and vacancy with something left over.

Second thing is motivation — I want to know why this seller is going off-market. Estate situation, tired landlord, pre-foreclosure, divorce? The reason matters because it tells you how motivated they actually are and whether there's room to negotiate. If a wholesaler can't tell me the seller's situation, that's a yellow flag.

Third is condition — specifically big-ticket items. Roof, HVAC, foundation, electrical panel age. If you can't give me at least a rough condition picture on those, I'm passing until I can. A deal that pencils at the offer price can blow up fast if you're replacing a roof and HVAC in year one.

The best wholesalers I've worked with come with a package: address, price, seller situation, estimated rent, basic condition notes, and comps. Makes the conversation easy and fast. Feel free to DM if you want to understand what investors in specific markets are looking for.

Jay Toluganti · Answer

For you to analyze a deal, you need to have a buy box. Then a contractor you can trust and his/her napkin number for rehab. Finally an agent to confirm the ARV. One thing though about ARV. Prices are falling everywhere. So, you may have to list less than the agebt number today. That comes with ecperience. DM me if you wamt me to show you how I underwrite. We can have a zoom session.

What Makes An Off Market Deal Worth Looking At?

What Makes An Off Market Deal Worth Looking At?

Most Popular Reply

6 Replies