Why I Hate the MLS for Finding Investment Deals
Using the MLS for finding investment properties?
You’re probably shooting yourself in the foot with this mistake that most new fix & flippers make.
You read all about the profit real estate investors make, you read a blog post or maybe a book, and then you jump in. Maybe you think that since you were a real estate agent before that it should be easy for you to start collecting 5-figure checks every month.
You think “okay, I need to find deals where I can increase the After Repair Value by enough to cover all the costs and still leave a nice payday for me.”
Good thinking so far.
So you start browsing the MLS.
Because that’s where you find properties, right?
Well, not me. Any strategy I’ve seen that uses the MLS successfully also utilizes fancy and/or expensive tools… never do people sitting in their computer chair browsing find deals good enough to flip for a profit.
But why not?
1 – Everyone else is doing it, too
When people looking for financial freedom first start out, they usually look for the easiest strategy first. They want the money without putting in the hard work to hone their skills.
And because it’s so easy to browse the MLS, everyone else does it too. That means sky-high competition.
2 – You make less profit
Even if you, by some miracle, DO find a potential deal on the MLS, odds are that the profit numbers won’t quite work out.
A deal like that will have a dozen other investors bidding, naturally driving the price up. Whoever does buy the property will be looking at razor-thin profits, if they’re lucky.
So What’s the Solution?
You need off-market deals.
The vast majority of deals that I find are from people who haven’t listed their property – and often haven’t decided that they even want to sell it.
You want to target people who are going through life transitions and the property is no longer in their plans. Or, they’re so fed up with a property they just want to be rid of it. Either way, you must have a strategy for targeting these people before they put in on the MLS or many other investors catch on that this is a great person to market to.
Here are a few of my favorite types of people to target:
- Probate Properties – this is when someone inherits a property. Often, the inheritors don’t want the property itself, either to cash out and split money among children of the deceased, or they live out of state and don’t want to maintain it.
- Out of State Landlords – I love targeting these people, because I know firsthand how frustrating renting out properties can be. It can be a headache if you live in the area – let alone if you’re out of state. Often these landlord/owners are just done with the property and are willing to let it go at a discount to just be rid of it.
- Properties with High Equity – People won’t be willing to sell their property at a discount if what you’re offering doesn’t cover what they still owe. If they own it free & clear, they’re more willing to take a discount because all that money goes straight into their pockets. I often stack this strategy with others (ie high equity properties with a tax lien over $10k).
Anyway, those are just a few of the strategies I teach. I’d love to work with you to find a strategy that fits your goals. If that sounds like something you’d be interested in, click the button below and answer the short questionnaire to see if we’re a good fit!