What Are Off-Market Home Sales?
What is an off market home sale? And, how can you benefit from buying property off-market?
An off-market sale means that a property was sold off the public market. It was never listed on any MLS, Multiple Listing Service. The public does not know an off-market sale occurred.
With an off-market sale, the entire transaction, from the beginning to closing signatures, happens without any advertising or promotion.
Off-market home sales occur because the property owner had reasons to never list the home with an agency in the first place.
Or, there was an interested buyer that was aware of the purchasing opportunity and wanted to acquire the property as quickly as possible.
Why Off-Market Home Sales Occur
Off-market homes for sale are attractive to real estate investors. It can be an opportunity to buy property beneath market value. It’s great for anyone looking to acquire some equity, and generate some profit through the real estate market.
A homeowner who wishes to sell their property off-market does not want to deal with all the processes and fees that come along with traditional on-market real estate sales.
Sourcing a real estate agency, waiting for advertising and promotion to kick-in, and paying out realtor commissions. This may not be viable for some homeowners who need cash fast.
In rarer cases, there are off-market home sales that occur because a property is so exclusive and sought after that interested buyers need to have an “in” to even be considered a potential buyer.
This is usually the case when the property itself is very unique and exclusive. Some examples would be properties owned by celebrities or regionally celebrated/historic properties.
How Do You Find Distressed Properties For Off-Market Home Sale Opportunities?
Off-market homes for sale are not easy to find. But, with some due diligence, you can find a distressed home and turn it into an off-market sales opportunity.
Remember, a distressed home or property has serious repair considerations before it’s fit for sale. It’s a home that is no shape for the open market. And, it would need lots of capital investment to renovate and make it attractive for buyers. A distressed property is a perfect candidate for an off-market sale. But, how do you find a distressed property? What if you have no direct affiliation with the owner?
Tips For Locating Distressed Properties
- Drive For Dollars
This tactic is often the first step to locating real estate sales opportunities.
Pick out a neighborhood in your region that you believe will have some distressed homes or motivated sellers.
Walk or drive around the neighborhood, looking for telltale signs that a home is in distress.
An overgrown lawn, boarded-up windows, and signs of deterioration are indicators of a distressed home.
Record all details about the property. Do some research on how to best contact the owner to inquire about sales opportunities.
- Locate Properties With Delinquent Mortgage Payments
If you go to your local courthouse, they have public records available of property owners with delinquent mortgages.
People who are in financial strife and cannot pay their mortgage face foreclosure. Foreclosure is a painful and financially draining process.
These property owners are often willing to enter into an off-market sale. Getting cash from an interested buyer to avoid foreclosure is usually the better choice.
- Investigate Local Tax Records
Just as with mortgage payment records, you can also access delinquent tax records at your local courthouse. These records will give you some insight into which property owners are in financial distress.
For these property owners, an off-market sale could be the answer they need. The quick off-market sale will relieve them from deep tax-debt and financial burdens.
Seize Off-Market Sale Opportunities
For both interested buyers and sellers, off-market property sales can be the quickest and most efficient way to close a real estate transaction.
For the seller, the cash comes quickly, and there are no realtor/advertising fees associated with the sale. Plus, they don’t have to worry about getting a distressed home renovated for the open market.
For the buyer, it’s a great chance to invest in a property under market value, and eventually turn the property for financial gain.
To learn more about off-market sales and real estate opportunities, please contact us.