What Does Off-Market Mean In Real Estate - YouTube

So, what does off market mean in real estate and I really understand the

question. Because with the way real estate  prices have gone recently everyone is kind  

of wondering where can they get a good deal?  Further, would you like to know how to find  

them and actually get one for yourself.  Well, I'm going to cover that right now. Let's go.

So, I'm going to go over what the definition of  off-market real estate is. I'm going to go over  

the different types of off-market deals that you  can find and then I'm going to show you how to  

actually, find them, and then if it turns out to  be something you want to dive deeper into and  

you want some additional help. At the end, I'll show  you how to get it. In real estate really simply put  

off-market means the property is not  listed on market for sale. But there's two  

different sort of context that you're going to  want to pay attention to of which could result  

into two distinct meanings and but first let's  talk about why you should even care? The reason

off-market properties are important and  something that you want to pay attention to  

is because you've got less competition there. When you actually find one you might just have one or

two other buyers that you're going to compete  against or maybe none at all. Also, negotiations.  

They can become much more flexible and essentially  it really becomes in the buyer's favor. The power

is a little bit more in your position and further,  as the buyer, you'll have an even greater hand if  

the seller is in some sort of distressed situation.  The burden of the sale will typically fall into  

the seller's lap and they have to kind of do what  they can to appeal to the buyer and as real estate  

investors you know when you go in and look at  a property that's in a distressed situation  

you know you're there to help. You're there to do the seller a favor. So, it's really in the seller's

best interest to try and convince you the buyer  to buy the property as opposed to how most people  

will go about it where. The buyer goes in trying  to convince the seller to sell and consequently

the seller will typically place fewer conditions  on that sale and all of these things can result  

into a signed contract that otherwise might not  have happened had that property been on market.

So, if the buyer has a little bit of an advantage  in purchasing an off-market property why would  

the seller even choose to go this route? So, unless  it's a luxury pocket listing type of transaction  

the seller is probably not too interested in  getting top dollar. That may sound crazy but  

there are things more important to people than  getting top dollar like the speed of the sale  

they need to sell fast or the convenience of the  sale. Maybe they don't want people coming through  

their house on the weekends and they don't want to  go ahead and always have the house ready to show  

or what I find more times than not is sellers are  more interested in the certainty of the sale. They  

actually want it to close and oftentimes that is  more important to them than getting top dollar.

Now, there are really just three reasons why a property  would be considered off-market. The first one is  

the seller might have previously had the property  for sale and for one reason or other removed it  

from the market and so they're no longer accepting  or reviewing offers. If you've been shopping online  

like a Zillow or a Redfin or a Trulia, you may have  seen a house here there that said it was actually  

off-market. Well, that's what it means most of the  time and you might see additional labels attached  

to those properties that are off-market like sale  pending or contingent. So, when a property is marked  

pending what that means it's under contract  and likely all of those contingencies or  

the conditions that were given to the buyer  they've all been met. Now, this could be still an  

opportunity for a purchase for yourself you'll  have to pay attention and follow up with the  

property. Because not every single property will  close when it's pending and it will come back on  

market sometimes. Contingent properties are still active listings technically but they are under  

contract and the buyer is going through their due  diligence process. Now, that's another area that you  

may want to watch because if something comes up in their due diligence process that they don't like  

it might be reason for them to cancel the contract  and that property will go back on market as active  

and that could be an opportunity for you. Something  that everyone else kind of gave up on because they  

thought it was already sold because you followed  up that could turn into a great deal for yourself.  

Another label that you may see is temporary off  market and there are a few reasons that a property  

might be just temporarily off-market. First is the  property might have been on the market for a while  

and it hasn't sold and the seller they just want  to take a break. Two, the seller may be traveling  

and doesn't want anyone in their house doesn't  want it being shown while they're not home.

Three, the seller might be making repairs to the property and getting it ready to sell  

and they don't want people coming through the  house before it's finished. They don't want people  

potentially getting hurt with construction  going on that's another reason or four maybe  

the seller has house guests and they don't want  to be interrupted and you'll see this frequently  

during the holidays or during the summer months.  The second reason a property might be considered  

off-market is because it's classified. Meaning,  it's a pocket listing. A pocket listing is where  

a seller will employ a real estate agent to sell  their property but they want them to sell the  

property privately and agents will typically  market these properties as office exclusives  

to their more preferred clients. You'll see this a  lot in the luxury home market and they may share  

these pocket listings with a small network of  their closest friends their associates in the real  

estate industry. Once an exclusive process these  pocket listings they've become a lot more common.  

It's actually become so common that the national  association of realtors now has a policy that  

these types of listings these pocket listings can  only be promoted within their own office. The third  

reason a property might be considered off-market  is because it's being sold at auction which is  

technically not on market. You need to know about  these auctions to go and get access to these types  

of properties and the reason a property might end  up as an auction could be one, as the seller has  

fallen behind on their payments and now it's in  default and the bank wants it back. Two, they've  

stopped or failed to make their property tax  payments and so now the city or the county  

is taking that property back or third, it could be  some sort of you know mischievous or indiscretion  

that the seller has been involved in and in other  words a crime and the US marshals are now seizing  

the property. The fourth reason a property might  be categorized as off-market is because it's  

just flat out not for sale and this is typically  where real estate investors play myself and my  

students included and you'll find typically zero  competition here at all and really kind of where  

the best deals can be found if you know how to  go out and reach out to those sellers. So, before  

I break down how to find these off-market deals.  If this already kind of has your wheels turning  

and you really take your real estate investing  seriously let me know by clicking the subscribe  

button. Because I post stuff like this each and  every week that can really help you level up your  

real estate investing. So, now let's talk about  how to find these deals now that you know what  

they are and I want to start with the properties  that are listed on the multiple listing service  

and this is the MLS. This is what the real estate  agents use to serve their clients where they help  

their clients buy properties where they help their  clients sell properties and if you have access to  

the multiple listing service then you probably  already know this. If you don't, you're going to  

want to connect with a real estate agent and they  can give you access and you can work together.

But what you'll do is you'll search the multiple  listing service and in the little category you can  

define what status you're looking for and if we're  looking for off-market properties you can look for  

contingency properties, you can look for pending  sales, and what you do is you make a list of those  

properties and then you just kind of check up on  them on a daily basis or every other day or so  

to see if any of those should fall out of contract  so you can be first in line to take advantage of  

those opportunities. If you don't have access to  the multiple listing service you could look to  

a website like a Zillow or like a Redfin or like  a Trulia and you can search there as well and you  

will find pending sales you will find off-market  properties as recently as just yesterday when I  

looked it was there. Now, they have a tendency to  change their websites all the time so it might  

not be as simple as that but you just have to be  a little bit more intuitive be do a little bit of  

investigating look around a little bit and you'll  be able to figure it out. Now, let's talk about how  

to find the pocket listings and those are going  to be directly from a real estate agent. So, you're  

going to have to connect with a real estate agent  to really get any sort of substantial access to  

these types of properties. However, not every real  estate agent will have access to these off-market  

properties. Experienced agents are most likely  to have access to these properties and a network  

in place of other experienced agents that will  have these pocket listings as opposed to someone  

that just got their license. Now, one thing to  mention when working with real estate agents  

you kind of have to understand how they view or  what their perception is of real estate investors  

for the most part. They certainly have their custom  clientele that they work with over and over and  

over again. But for the most part they look at  the entire real estate investing community or

real estate investors in a very specific way and  it's not really in a good way. You see, they hold  

open houses on the weekends and there will be  a time where I don't know two three four on any  

given day real estate investors will come in and  ask that real estate agent, "Hey, you got any deals?",  

and they get that question all the time and  they come in and they say, "I'm just looking for  

something that pencils. I'm looking for something  that makes sense", they're very vague with their  

criteria and real estate agents they just kind of  roll their eyes in the back of their head because  

they know it's probably not going to amount to  much. Because most of those real estate investors

do waste their time. So, understand, if you're  reaching out to a real estate agent for the  

first time that is their perception of you  already. So, be patient with them and explain  

to them specifically what you're looking for  and how you plan to purchase and who you plan  

on representing you and you're going to get a  lot more cooperation. The best thing you can do  

when you connect with a real estate agent is  when they bring you an opportunity is for you  

to follow through. Because if you follow-through  that means they get compensated. At the end of the  

day that's what real estate agents care about  most. They care about the commission. They care  

about frequent commission. They care about easy  commission. They care about for sure commission  

and if you represent that to them that could be  a great source of these pocket listings for you.

One last place where you can find these pocket  listings and this is rather new they have pocket  

listing services. You can find pocket listings  on various websites such as homefinder.com  

auction.com. They are great sources of properties  on realtytrac you can find your foreclosures  

there and don't forget Craigslist. It's kind of a  necessary evil but there are deals found on there  

each and every single day and also, try going to  usmarshals.gov. Every once in a while you'll find  

some great opportunities there too. Now, another way  to find off-market deals is to contract property  

owners directly. Those that don't necessarily have their property for sale at all. Now, this is how  

I've purchased most of my properties and it's how  I teach my students how to do it as well and what  

we're looking for are property owners with signs  or symptoms of distress like personal distress,  

financial distress, or maybe the property itself  is in some sort of distress, and then we'll contact  

them through a number of means like maybe via  direct mail, maybe knocking on their door, or just  

the good old-fashioned telephone. We'll also mark  it in a way that attracts distressed sellers to  

us and we can do that in a number of ways. Anywhere  that you can market or advertise is a great way to  

attract these sellers to call you for help. You  know that might happen through those little ugly  

yellow signs that you've seen in your neighborhood  it says, "We buy houses", you see those everywhere  

because they work it's a great way to contact and  find off-market sellers off-market deals. We can  

also use social media, we can use google ads, and  classifieds both online and off and really there's  

an unlimited number of ways that you can do  this. Wherever there's marketing. Wherever there's  

advertising that's a potential opportunity for  you to place your message in front of distressed  

sellers. Now, contacting sellers it can sometimes  be slow going at first but with persistence  

and consistency it can snowball into an abundance  of real estate opportunity for you. So, be patient  

because you'll talk to sellers who might not want  to sell now but if you're patient and you stay in  

touch when they are ready to sell they're going  to contact the person that they remember. So you  

want to stay at top of mind and you continue to do  that with your marketing. Now, another strategy to  

contact these types of sellers that might be more  ready to sell than not is to go through the public  

records and kind of evaluate their situation and  see if they're in a position where you know they  

probably actually need to sell or very at least  should sell and what I'm actually referring to  

are properties that are in pre-foreclosure  or properties that have been issued a notice  

of default. You see, these are public records and  this is a sign a symptom that there might be some  

sort of financial distress there because what it  says is they have fallen behind on their mortgage  

payments and either they're going to catch up or  they are not and if they are not you want to be  

there to help them out before the bank actually  takes the property back and you should also  

monitor eviction records because evictions can  be costly. They can be time-consuming. They can be  

very frustrating for landlords and this might  be an opportunity to reach out to a landlord  

when they've absolutely had it and they're  ready to sell. So, if you'd like to get started  

looking for off-market deals what I've done is  I've put together a short free training for you  

and you can go ahead and access that free training  at maxfreetraining.com. Now, you can type that in  

your browser directly or for your convenience I've also, put a link in the description for you below  

and if I don't see you there I will see  you next time. Thanks for watching, take care.