- 7 proven techniques for finding the best real estate investments!
7 proven techniques for finding the best real estate investments!
Are you getting started in real estate investing?
Struggling to find the best real estate investments?
Have no fear, these seven methods to find deal properties will assist you along your investing journey. I have seen success from all of these methods, and most of them require nothing but a little time to accomplish!
Learning these methods to find a property will increase the number of properties worth analyzing. This, in turn, will increase the number of properties worth writing an offer on. Which, eventually, will increase the number of properties that you can purchase, or wholesale to another investor (more on this later).
DEALS FOUND —> DEALS ANALYZED —> OFFERS MADE —>OFFERS ACCEPTED.
1. Multiple Listing Service (MLS)
As you learn how to become a real estate investor, the MLS should be your starting point for deal properties. The MLS is the system that real estate agents list all of the properties that are for sale in the area.
I recommend you do some research and find a solid real estate agent. Have this agent set up an automatic MLS search to find a property that meets your criteria. Once set up this system will automatically email properties to you as they come on the market! What better way to start looking for the best real estate investments than to have leads come to you!
Admittedly the MLS will not generally have the best deals, but it is easy to use, and a great place to start! I have found some great investment property this way!
You can also use PropStream for this (I love Propstream)!
2. Driving for Dollars
Driving for dollars is another tactic to find deals, and it can easily fit into your schedule. The easiest way to do this is to take different routes to/from work on your commute. Another easy method is to take different routes while running, and really study the neighborhoods.
The goal of driving for dollars is to learn the neighborhoods. In this way, you can become familiar with what areas are growing, and which are falling apart. You want to keep your eyes peeled for the ugliest houses in nice/growing neighborhoods!
Take down the address of any house that has some promise, and then you can send them a letter to mention your interest in the property!
3. Direct Mail
Direct mail is the process of sending letters to property owners and asking if they are interested in selling. This is a great method to reach a lot of people with minimal effort. I like to purchase a list of from Listsource because there is no limit to how specific you want to make the list!
I paid for a list of absentee homeowners that owned multi-family real estate within the 658XX zip code and sent the below letter before going home for Christmas. These mailouts cost about $75 in total (list, stamps, return address labels, envelope, legal pad (paper), and blue ink pen). I had several responses within a week, and one of those responses led to the purchase of our 10-plex!
It takes more time, but handwriting these letters will have a much better response rate: roughly 18.75% vs. 7% in my experience. My rule of thumb is to handwrite letters if I’m targetting specific houses, but for larger mail-outs, I print to save time.
Whether you handwrite, or print, always do these three things to improve the response rate!
-Sign the letter, this will show you still handled all of the letters.
–ALWAYS hand-address the “To” address on the envelope. This will increase the number of letters that get opened!
-Insert a photo and/or business card into the envelope (this builds credibility, and pulls the recipients heart-strings).
4. Networking (referral)
Referrals are a great way to get the best real estate investments. The key to referrals is to ensure that you Build your network. As you meet more investors you will be introduced to wholesalers, flippers, buy-and-hold investors, agents, and a myriad of other people.
Putting your feelers out there for real estate, and building a community full of people doing the same thing will have very positive effects. I have found that the real estate investment community is full of helpful people, and deals are always getting offered back and forth based on criteria, and availability!
Side note: your network will also provide you with a wealth of knowledge, and potentially some private lending. The key here is to be the kind of person that people want to invest time/money into (personal development)!
5. Talking about what you’re looking for!
I heard a great tip on an episode of the Bigger Pockets Podcast once! They talked about how to turn a simple, everyday conversation into a lead generation technique, and it goes like this.
(another person) “Hey David, what’s up?”
(Me) “Not much, how about yourself?”
(another person) “Just livin the dream.”
…sound familiar? We have a conversation like this every day, and I had never realized the opportunity I was missing! Next time this conversation appears try this out:
(another person) “Hey David, what’s up?”
(Me) “Lately I’ve been looking for distressed homes to purchase and revitalize. Do you happen to know of anybody that needs help selling their home because of the amount of work it needs?”
(another person) “Actually, a friend of mine inherited his grandparents old home, and isn’t sure what to do with it!” (in a perfect world right?)
The key is not to be pushy here, but to answer honestly about what you’re up to. unfortunately, the majority of us pass up this perfect opportunity without even noticing.
6. Bandit signs
Have you ever seen one of these signs around town?
These are called “bandit signs” because a lot of cities have passed ordinances to ban them. That is because investors will go overboard sometimes to find the best real estate investments. Try to find a happy medium, and avoid looking trashy while utilizing these signs.
I have not used bandit signs in the past, but I’ve known several investors that had luck with them! The key is to keep the message short, and LOUD! These signs are a surefire way to attract distressed sellers, and potentially lock in some great deals.
I recommend that you have a lot of practice analyzing deal properties before utilizing this technique because you will need to be able to quickly evaluate if the house would be an asset or liability for you.
7. Facebook Ads/Google AdWords
Finding the best real estate investments has gotten easier due to advancements in modern technology. It is now possible to find, analyze, and purchase real estate without leaving your barracks room!
The marketing and advertisement world has changed so much in the last decade. These changes have made it possible to write facebook ads that directly target your specific city or zip code. Instead of a bandit sign, you could write a Facebook ad “We want to buy your house in Springfield, MO” and blast it to every Facebook user in that area. This might cost a little bit more, but is an effective method to reach people.
Google AdWords allows you to research what words/phrases are most commonly searched for. As a result, you can write an advertisement that will show up on the keywords that best meet your needs. Google is used for around 80% of online searches, and there aren’t many better ways to get in front of your niche than keyword advertisements.
These two online companies will cost more money than the rest of the discussed methods, but with a little practice, these methods can greatly improve your results, and bring leads to you with minimal effort.
If you’re interested in starting one of these great websites, sign up here!
Summary – 7 Proven Techniques to Finding the Best Real Estate Investments
The best real estate investments are out there, but you have to actively seek them. Real estate agents can bring you lots of deals, but some of the best opportunities are off-market deals. For this reason, it is crucial that you employ more than one method to find a property!
Real estate investors make their own luck, and they do this by making it known what they are looking for. When you TAKE ACTION and start actively looking for an investment property, it is only a matter of time before you get one!
How do you search for deal properties?