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When people are in the market for a new property, they are either looking for an investment property or an excellent residential property. But it’s not as easy as it sounds; investing and locating an ideal residential project can be a complicated process if you aren’t familiar with the factors and procedures that you need to consider.
As your first step into the process of real estate investment is finding a great property. So the next question is, where do I find better residential properties? Various methods can help you in finding a better residential property, including searching on MLS and local classified list, attending networking events, sending out advertising flyers, or just driving through a neighborhood.
Here’s a short video I shot about Where to find good residential properties:
That’s a good starting point, but let’s dive a little deeper.
5 Most Effective Strategies to Find Good Residential Properties
Here I’m going to cover the details of the 5 strategies I use to find good residential projects. Please keep in mind that this is not an exhaustive list but they are the most useful strategies I have used myself.
MLS is the most basic real estate research tool which is used by almost everyone. It provides you with various listings from multiple brokers. This database is enormous because it covers all the majority real estate listing websites. However, there are significant drawbacks to relying on the MLS to find deals. There is a lot of demand and very little supply. Millions of people use this database, which makes it difficult for you to get early access into the listing.
The Good Old Newspaper Listings
Even if you have zero knowledge about real estate investments, you can start simple by keeping an eye on the Classified section of the newspaper. It is an old school way to scoop out good residential projects. It’s not the most effective way to find deals, but it’s cheap, easy, and you can at least get your feet wet.
If you know how to make connections and then leverage those connections, you can do almost anything in this world. The real estate market is not an exception to this phenomenon. This is the most widely used way to sell good residential properties. All you have to do is simply talk to people who are involved in the real estate investment market.
I’d suggest finding other investors via real estate clubs or networking events that are both in-person and virtual. You might think you’re simply meeting the competition, but often relationships like these lead to the best deals. For example, maybe someone would like to partner with you on a deal, or you meet a wholesaler who’ll send you their next deal.
In addition, you can make it known to your social circles that you’re looking to buy properties. I’ve worn shirts and hats that say “I Buy Houses” that have sparked conversations. I mention it casually to people I talk to when the topic of my job comes up. Or, you can use social media for this.
You can write a status like this:
“I am glad to let you guys know that I am looking to invest in good residential projects. I would appreciate it if you guys would let me know of anyone who might be interested in offloading a property or if you know people who invest in real estate.”
I understand that this process feels a bit weird but trust me guys, it works like a charm. Just imagine, without investing anything, you will get to know about exclusive listings that aren’t available on the internet. You will be surprised to get listings from people who you haven’t talked to for decades.
If you are not comfortable doing this, I suggest that you get in touch with some top-rated real estate agents and explain that you’re looking for deals where the asking price might be low because of a motivated seller, of if their client’s property isn’t FHA approved and the buyer won’t be able to get a conventional loan for it.
If they believe that you are a potential buyer who won’t waste their time, they may keep you in mind…especially if you give them a finder’s fee. Now, I mentioned before that you shouldn’t rely on real estate agents for your success, but you can make this work by talking to hundreds of agents. Only a small percentage will be interested. I would also make this strategy just a part of your marketing, not the whole of it.
Marketing Your Needs
If you can afford to invest in some outbound marketing, you can manage to get a lot of leads for real estate investments. You can promote yourself in a way that you are on the lookout for some good residential projects using postcards, flyers, bandit signs, Facebook ads, etc.
The “Driving for Dollars $” Technique
Everyone is on the internet these days. Especially with the rise of MLS, millions of people have access to a real estate listing, which means a lot of people bid for the same listing, which makes it an ultra-competitive process. Wouldn’t it be fantastic if you could get to know about the listing before they are even updated on the internet or even before they have a “FOR SALE” sign? It sounds impossible, but it is possible. All it requires is some severe hustling and a winning attitude.
To take advantage of this strategy. You just need to hop into your car and drive through a neighborhood where you can find some good residential projects. If you are lucky, you can spot a few “FOR SALE” signs. But even if you don’t find any of those signs, you can still learn to find other potential deals.
You have to look for distressed properties that are not being paid attention to. For instance, you need to look out for houses which have a lack of maintenance, vacant houses, a stuffed mailbox, bank notices, etc. These types of properties often indicate an owner who lives elsewhere and would rather move on from the property than pay close attention to it. The efficiency of this strategy depends on your research skills.
The Ultimate Strategy
These are all the solutions which are already known by experts. But I will tell my secret formula to where to find suitable residential properties. As you’ve figured out by now, that’s probably not going to include properties on the MLS. Once a property goes on the MLS, millions of people, including other investors, can see it and prepare offers..
I am not saying that the traditional ways don’t work, but since everyone is doing the same thing, you need to do something to stand out. So, the key to finding good residential properties is going after off-market properties. But that’s going to require doing some marketing and sales skills, which means you want to see properties that have two things.
- Motivation – You find sellers that have a reason to move on from a property and are willing to do so at a discount.
- Equity – If an owner has equity in a property, they are more likely to take a discounted offer.
One of my secret tricks is that I like to use the Investor’s Edge software. This software pulls data from over 160 million properties across the US and let’s you sort by a variety of factors. You can pull lists in minutes that include:
- Vacant Properties
- Non-Occupied Properties
- Properties with liens
- Properties with equity
Generally, people look at various factors before buying a residential property such as location, neighborhood, area, condition, and rate per square feet. A misconception I see in real estate investing is thinking that finding properties is the easy part. I can tell you that understanding the process is easy. All you have to do is find something that needs work, at a discount, then fix it up, sell it for profit, or you can turn into a rental, wholesale the property.
It might be simple to explain, but it’s anything but easy to find a decent residential property. It is the primary job of a real estate investor. This is where a lot of people get mixed up and make mistakes because they will think they’ll just delegate success to a real estate agent, but the reality is that doesn’t work. Occasionally a wholesaler can find a property for you. But, that’s not something you want to bank on.