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How To Find Cheap Houses in 2020 - YouTube
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how to find cheap houses off market
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properties where you can add value and
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start to own those as buy-and-hold
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real-estate investors that's today's
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show let's dive into it hey everyone I'm
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Clayton Morris if you are new to the
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channel please subscribe if you're a
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longtime viewer please hit the like
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button I really appreciate it if you are
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new to the channel this is the channel
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where we help you build financial
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freedom and help you build financial
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independence with buy-and-hold real
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estate 'van a real estate investor since
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Jesus I think 2007 ish 2008 when I did
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my first flip years ago down in the
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great state of Florida in the meantime
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I've seen all manner of things happen in
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the real estate business and on today's
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show we're gonna talk about five ways to
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find cheap off market properties okay
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first before we dive into five different
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ways to find them and there are more
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than five ways but these are five great
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ways that I certainly use to find
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properties over the years and you can
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too in your own backyard but before we
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kind of get into finding off market
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properties I want to talk about what is
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an off-market property why would I even
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want to find an off-market property
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shouldn't I just be calling a realtor
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and getting a property that's on Zillow
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or on the Multiple Listing Service no
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the answer is no so what is an
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off-market property let's simply that
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it's it's a property that's never made
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it to the Multiple Listing Service it's
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never made it to public websites etc
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because of certain reasons because it's
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been in it you know it's an inherited
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property someone inherited the property
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it's set in probate for a long time it's
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fallen into disrepair no one knows where
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the owner is a lot of these things can
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happen and they might not ever make it
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to an on market property I think most
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people think about real estate investing
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they think about you know seeing the
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balloons out for an open house and
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you're gonna go on the drive around your
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neighborhood on the weekend and look for
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a property and you're gonna pop in and
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out of open houses as an investment hey
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honey it's Saturday afternoon let's go
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look for an investment property maybe
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we'll find an open house no that's the
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worst possible way to find an investment
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property and one of the main reasons is
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because you know the money is the profit
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is made on the purchase of one of these
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when you buy a property you're buying it
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below market because you're probably
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gonna have to put a bunch of work in to
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the property you're gonna have to
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upgrade it with twenty thirty thousand
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dollars worth of work so if you're
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paying retail price for that property
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and then on top of that you have to do
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twenty thirty fifty a hundred thousand
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dollars worth of work on that property
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then you're overpaying you're you're
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moving your needle and your ROI will be
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much much lower so the reason we want to
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find off market properties distressed
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properties is because we can get them
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for cheaper then we can add value and
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that's how we can create a nice return
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on investment so it all comes down to
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the numbers so at a high level that's
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why we go after off market properties
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okay almost every property I buy is off
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market investors selling back and forth
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that's how it happens okay so if you're
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just getting started to understand that
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part of it so now let's go through five
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different ways that you might find off
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market properties number one is to call
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Realtors now I know I kind of just
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slammed them now my wife is a realtor my
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father's a realtor Realtors typically
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deal just in retail purchase and sales
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right there holding open houses they've
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got a beautiful property that's just
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been completed they're gonna sell it
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that's typically what Realtors will sell
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and I know this because I read the
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comments in the threads below our videos
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and I've seen a lot of Realtors who say
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Clayton you're right
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most of the time we just want to deal
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with a great property that doesn't need
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a lot of work and we're you know working
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with with families to move in and out of
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properties that's what we do they don't
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often deal in distressed properties that
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need a ton of work right roof is falling
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and it's fire damage you name it
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Realtors tend not to deal with that
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however you can define Realtors that
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handle distressed properties now how do
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you find them well one thing you can do
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is look up a number of your local real
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estate offices in the area where you're
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looking to invest and simply start
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calling the agents right call you're
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gonna find a list of them and just start
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calling a bunch of these agents and just
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say hey look you know I'm interested in
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finding investment properties do you
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ever find off market properties that
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come into the office that no one knows
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what to do with
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very often this is known as a pocket
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listing literally means like putting it
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in their pocket because it's in the
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office they've got this crappy property
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they don't know what to do with it it
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kind of sits in the office and the real
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the Realtors in that office don't know
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what to do with it and sometimes the
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seller will say look if you have it I
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don't want to put it on the Multiple
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Listing Service I don't want anyone
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walking through this property but if you
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know of any investors that kind of float
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in and out of here you know please feel
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free to share this property with them
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that's called a pocket listing and
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realtors are often can be a very good
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source of these types of properties you
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just have to find the right one so what
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I did when I was first starting years
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ago I got a full list I think I'm like a
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thousand realtors in my area and every
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day I made it a mission to call 20 of
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them every day and I had a little
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checklist on my phone their name check
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and I'd call and if I had a conversation
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with that person I make a little note
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next to that person's name and add them
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then to my iPhone contacts so that I had
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information about what office they were
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in were they in Weikart were they in
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century 20 whatever they were and I made
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a little note and I would follow up the
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with them then via email short time
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later
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hey John it was great talking with you
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this afternoon about distressed
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properties that you might come across
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here's my email please let me know
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you've got to take action okay you can
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start to develop those relationships
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then I would also suggest even taking
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them out for a cup of coffee so if you
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call a hundred Realtors you're gonna
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find one or two that might work with you
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to bring you distressed properties take
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that person out to coffee sit down with
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them learn the market a little bit more
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and that's how you can start to develop
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those relationships with Realtors number
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two on my list for finding off market
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distressed properties is I know it's
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kind of one of my favorites to be honest
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with you because I don't like being in
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an office I don't like sitting behind a
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desk all day I like to be out driving
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for dollars so that's what you can do is
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go out and drive for dollars it's number
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two on my list what is that that
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literally is what it sounds like
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it's getting in your car taking a walk
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with a dog and walking all around the
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neighborhood's you're looking to you
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know - - buying rental properties or
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flips if that's what you're if that's
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what you're after
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what you're going to do is you're going
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to look
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for properties that are in distress and
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I'm telling you they are highly visible
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this morning I was taking the kids to
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school and I passed 2:00 or 3:00 this
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afternoon that made me even think or
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this morning that made me think about
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this which is there's you know a roof
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that's in total disrepair there's all
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kinds of branches up in the gutter
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there's the shave the the shutters were
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falling off the side of the house it
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didn't look like anyone was there that's
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clear sign of something going on there
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and you might then pull over you can
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even write out a little post-it note
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that says I'm interested in buying
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properties in this neighborhood you
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could slap it on the front door with
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your phone number or you could knock on
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the neighbors doors and say hey I'm a
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real estate investor in this area and I
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noticed the house next door is in
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disrepair what's the story with that
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they're gonna know they are absolutely
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going to know that Janice who lived
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there a year ago you know passed away or
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moved and the family doesn't want to
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have anything to do with this house so
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they've been letting it sit great do you
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have the family's phone number because
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I'd like to make them an offer and I
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guarantee you that that neighbor doesn't
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want that unsightly house sitting next
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to them anymore it's gonna be thrilled
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to give you information about how to
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connect with that family I've done it
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hundreds of times in fact one of my
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biggest deals came from me simply
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driving by a house writing out on a
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business card putting it into their mail
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or the like the storm door and you know
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in between the screen and I got a call
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later that day from the owner who just
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happen to be stopping by this house and
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grab picking up some mail that was in
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the mailbox and I ended up doing a deal
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with a vacant house that needed a ton of
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work so driving for dollars another
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indicator of a house that is in
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disrepair when you're doing driving for
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dollars is snow winter is a great time
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to find distress I mean how many of you
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watching right now can you know live in
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cold winter conditions where you can
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drive through your neighborhood you can
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clearly see the houses that haven't been
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shoveled and it snowed five days ago and
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there's no footprints and there's maybe
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a pile of newspapers in the driveway or
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during the summer
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another clear indication when a house is
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grass is you know a foot and a half tall
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and no one's cut the grass or there's
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stickers on the
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storm-door from the city because they've
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got high grass violations and other
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things those are clear indicators of a
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house that's in distress knock on the
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neighbor's doors and ask for a little
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information so those are some clear ways
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to find out whether or not this house is
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in repair and and you know this is where
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you can make a contact with the family
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and see about trying to make an offer
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find out what the story is on the
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property and literally getting a
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purchase agreement together and sending
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it to them and saying look this house
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looks like it's gonna need sixty
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thousand dollars worth of work I'm
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willing to offer you this how many other
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purchase agreements do you think they've
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received like that in the mail zero it
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you know fortune favors the bold so if
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you take action and figure it out make
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them a make them an offer and start to
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put the wheels in motion things could
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happen for you number three on my list
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is a killer strategy I hope you're
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writing these down number three on my
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list is tax liens okay tax liens
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phenomenal I guess what the county has a
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record of these or the township so it
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depends on the state and it can be a
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little difficult to get which is a good
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thing so some people will complain when
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they're starting out in wholesaling or
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real estate investing that all this is
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difficult to get a copy of these tax
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liens that's good news that means other
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people are having difficulty getting
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copies of the tax liens also that means
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if you are you know have a little bit of
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action in you and go out there and try
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to dig for it
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chances are other people are not finding
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it and you're finding it does that make
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sense so again if you have to go to the
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County Courthouse and it's not on the
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internet and you have to go down there
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physically and ask for a copy of all tax
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liens from the previous year in the area
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where you'd like to invest you're gonna
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get a list of the people that are behind
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on their taxes on their properties now
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sometimes it happens where there's like
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a little bit of an overlap like in New
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Jersey taxes are very very high and I
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found it to be particularly difficult to
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get accurate information about tax liens
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and so what I had to really do is dive
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deep but those spreadsheets because in
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New Jersey taxes are so high but if they
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are it might look like they're way
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behind
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well $1,700 in taxes they owe that could
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literally be from 1/4 and 1/4 in New
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Jersey meaning they were behind now
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they're caught up you maybe don't want
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to send them a letter saying you you're
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interested in buying their house but in
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other areas it's clear that they're
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behind from a year previous if they
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still haven't gotten caught up on their
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taxes that's someone wait sticking their
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hand up in the air saying look I don't
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want this house anymore
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okay I don't want this house anymore I
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can't afford to pay the taxes please
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come make me an offer for this property
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very often the tax properties that I
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found are vacant no one's living there
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they're behind on their taxes because
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the family inherited this property or
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it's just fallen into disrepair no one
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lives there and therefore there's a tax
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lien from the county or Township on that
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particular property again get a list of
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those if I wanted to in my backyard
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right here I would go down to the
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Township Building and I'd ask for a list
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of tax liens and they're public it's
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public record and I can pull those up
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and I can send them a letter or I can
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literally go put a post-it note on the
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door and say I'm buying properties in
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this neighborhood are you interested in
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selling if so give me a call at and give
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them your phone number now you might get
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some angry people why do you put a
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sticker on my door well you don't want
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to tell them I happen to know you're
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behind on your taxes but just say oh we
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know we're buying properties in this
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neighborhood it's it's no big deal if
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you're not interested don't worry about
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it that's rare but if you do find people
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that are behind other taxes you know
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might be an opportunity for you to make
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a deal on this particular property
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number four on my list is working with
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wholesalers in your backyard now there
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are wholesalers who if you've watched
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our video that I've done with Tom
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Crowell we have a whole hour long video
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I call it like the ultimate step-by-step
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wholesaling guide you should watch that
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video if you'd like because we take you
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through step by step by step how to do
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direct mail all of those pieces and you
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know if you can partner with a
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wholesaler in your back yard that would
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be a great way to find off market
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properties because now the wholesaler is
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gonna be doing all of this legwork for
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you they're gonna be driving $4 putting
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stickers on doors doing direct mail
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and of tax liens etc now you're gonna
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pay them a little bit of a premium not
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much but a little bit for them to bring
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you a deal but still a great source you
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can meet wholesalers by going to your
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local meetup groups so just go to
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meetup.com
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and look for your local readings our EIA
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meetings in your back yard there's
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probably gonna be one or two of them in
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your local neighborhood once a month
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they usually get together go into those
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meetings
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you'll see somebody with a name tag that
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says John I'm a wholesaler you know and
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just say hi I'm a investor I'm looking
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for buy and hold real estate I'm looking
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for properties and you have any deals
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you can start to bring to me that's why
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they're there that's why you're their
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partnership you know start to make some
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relationships with wholesalers buy
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properties from wholesalers all the time
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and they can be a great resource because
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typically they're boots on the ground
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they're hungry they're young they're out
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there making deals happen and that's a
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great resource to find properties that
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are not hitting the Multiple Listing
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Service and still need work to be fixed
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up and number five on my list best ways
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to find cheap houses off market
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properties is with Direct Mail
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I've spent tens of thousands of dollars
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on Direct Mail Direct Mail is simply
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getting a piece of mail you know like
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you get the circular from the local you
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know a local grocery store where it's
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advertising that's what you get that's
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what you do you pull a list you might
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even pull a list of like tax lien
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properties in your neighborhood and you
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literally get those addresses you find
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the owner's name John Smith that's the
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property he owns he's two years behind
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on his taxes maybe you put a letter in
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the mail that says hi John I noticed
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your property at 123 Main Street I am
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interested in buying properties in this
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neighborhood if you're interested in
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selling it please call me include your
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phone number done direct mail works and
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I would recommend picking one of these
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channels and going full-bore with it for
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me when I was starting out in
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wholesaling real estate Direct Mail was
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my number one resource I had a dedicated
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phone line set up I think I used ring
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central at the time and I had a
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dedicated phone number per each mail
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piece so I knew what mail piece what
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related to what phone number and I had a
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team that we would be able to answer
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these
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and with every about 100 phone calls
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that we would make we'd usually get one
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to two deals okay that means you got to
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put in a time you got to be on the phone
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making deals happen if you're hungry
[938]
like that and if you want to do the work
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yourself
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it can be a job right but this is the
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way that you make an advance in your
[945]
life so 100 phone calls getting one to
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two deals finding great deals I get in
[950]
the car or one of my team members would
[953]
get in the car and we go out to the
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property we'd see what needed to be
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worked on and then we would make an
[958]
offer to buy the property that's how it
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happens so those are the five ways let
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me recount them for you number one is
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working with Realtors who handle
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distressed properties number two driving
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for dollars getting out there and seeing
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distressed properties in your
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neighborhood number three
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tax liens at the county pull up a county
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website or go to the county courthouse
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and get a list of properties that are
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delinquent on their taxes not for one
[984]
month try to go back a little bit
[985]
because that's a clear sign that maybe
[987]
this person does not want this property
[989]
anymore
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number four is finding wholesalers going
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to your local meetup groups shaking
[994]
hands interacting becoming a real estate
[997]
investor and number five is using direct
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mail that's another fantastic way of
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finding off market deeply discounted
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properties they are out there they exist
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not every house is a retail house when
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you see balloons for an open house there
[1012]
are many more that don't have balloons
[1014]
that need work and need to be fixed up
[1017]
there you go thank you guys so much for
[1019]
watching please subscribe to the channel
[1020]
and give us a like I'd love to hear some
[1022]
of your methods for finding off-market
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properties you can leave those in the
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comments below thank you guys so much
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