How to Find Off-Market Properties: 13 Winning Methods

With both home prices and mortgage rates hitting record highs, finding new rental properties for your investment business has become increasingly challenging. Smart real estate investors are turning to off-market deals to expand their portfolios.

When a property hits the public market, it's open season for everyone. This is great for sellers but not so much for real estate investors. If you're aiming for the best deal possible, competing amongst a crowd often leads to overpaying.

There's truth in the old saying, "You make your money when you buy." This is where off-market properties come into the picture — if you can find a property that isn't publicly listed and the seller is willing to sell below market value, you've struck gold.

To use this strategy, you need to find hidden opportunities before they go public. This article covers why properties go off-market, the pros and cons of going after these deals, and strategies to uncover the best opportunities. These approaches can help you build your real estate business with smart purchases.

Defining off-market properties

An off-market property is one that's not available on the local multiple listing service (MLS). These properties aren't widely advertised and remain unknown to the general public.

You may hear others refer to these properties by various names, such as pocket listings, whisper listings, silent listings, or quiet listings. Off-market deals get transacted through direct negotiations between buyer and seller, real estate investor networks, word-of-mouth referrals, or specialized real estate agents.

Finding an off-market property is much harder than looking on multiple listing services to see available listings. It takes some legwork and effort, but these under-the-radar deals can offer better prices and terms, making the extra work pay off in your investment strategy.

Why some properties are off-market

You may wonder why a seller would consider selling off-market. Most of the time, it's due to the owner's personal circumstances or the property's condition. Common situations include:

• Pre-foreclosure: Owners may be trying to sell quickly to avoid foreclosure. If they've fallen behind on mortgage payments, they might want to sell before the bank takes action and still preserve their credit.
• Divorce: Couples going through a divorce may need to liquidate shared assets quickly. They might prefer a private sale to avoid public attention.
• Inheritance: When someone inherits a property, they may not want to keep it. For instance, siblings inheriting their parents' home might decide to sell it off-market to avoid disagreements about pricing or the selling process. They also might not want the hassle of getting it ready to sell, and if they offer it as an off-market listing, they can sell "as-is."
• Job relocation: A homeowner who suddenly gets transferred to another state for work might need to sell their home quickly, expediting their selling timeline.
• Financial distress: Owners facing bankruptcy or large medical bills might seek a fast sale to address their financial issues.
• Tired landlords: Long-time property owners might be exhausted from dealing with tenants and property management. They could be open to selling their rental portfolio quietly to the right investor.
• Major repairs needed: A homeowner facing costly foundation issues or extensive mold damage might prefer to sell as-is to an investor rather than fix the problems for a traditional sale.

Pros and cons of buying off-market properties

Every real estate investor dreams of getting a good deal, and off-market properties seem like just the ticket. However, there are pros and cons to consider for every off-market deal:

Pros

• Less competition: Since other buyers don't know about the property, you're less likely to face bidding wars, which means you can get better deals. Every real estate investor looks to maximize return on investment, and the less you pay for a property, the higher your returns will be.
• Better deals: Sellers may be more willing to negotiate on price since they aren't paying agent commissions or marketing costs. You also might be helping them out of a bad situation, which can lead to better pricing as well.
• Faster closing: Since the property doesn't require marketing and showings, these deals can close much faster than traditional sales.
• Flexibility: With these opportunities, you have more flexibility to negotiate strategies like seller financing or flexible closing dates.

Cons

• Limited inventory: You'll have fewer properties to choose from compared to the public market properties.
• Less transparency: Many of these properties are "as-is," so you don't get the benefit of an inspection or seller disclosures. This means you might risk facing undisclosed problems at some point.
• Potential legal issues: Off-market properties can be more involved, so it's a good idea to seek professional guidance with property issues or contracts, which comes at a cost.
• Market value uncertainty: Without comparable sales data, it may be harder to determine the property's true market value.

13 strategies to find off-market properties

What are the most effective ways to find off-market properties? Here are thirteen strategies to help you get started.

1. Grow your network

Meeting other real estate professionals or people connected to the industry is one of the best ways to find off-market properties. You can start by joining local real estate clubs and participating in meetings. These groups usually have an open networking format or a structured "haves and wants" section of their meeting, which is a great opportunity to share what you're looking for.

The larger your network, the better your chances of finding deals. Share your criteria and ask contacts to keep you in mind if they come across suitable properties.

2. Connect with other real estate investors

This might sound counterintuitive, since you could be connecting with potential competitors, but these connections can be surprisingly valuable. A fellow investor might find a great deal in an area they can't effectively manage, but you can. Or they might come across an off-market property that doesn't fit their niche but perfectly suits yours.

3. Work with investor-friendly real estate agents

You might be surprised to see agents on this list. After all, aren't they the ones using the multiple listing service? While this is true, investor-friendly agents can also be resources for off-market deals.

These specialized agents understand what information you need to evaluate investment properties and often have access to the following:

• Pocket listings: These are properties that the agent knows about but hasn't placed in MLS yet. They might be listings from other agents or past clients that need to sell quickly.
• Distressed property leads: The real estate agent might know of homeowners who need to sell quickly, like those facing foreclosure.
• Wholesale deals: Some agents do wholesale work on the side, which can provide leads for off-market properties.
• Investment analysis: Real estate agents can help you evaluate potential deals by providing investor metrics such as cap rates and cash-on-cash return.
• Market insights: Experienced agents can guide you with their in-depth knowledge of local trends, up-and-coming areas, and property values.

4. Leverage real estate wholesalers

This group focuses on finding great deals and delivering them to investors for a fee. They play an important role in the real estate investing ecosystem because many investors don't have time for cold outreach and marketing like wholesalers do. In return for their work finding real estate deals, they receive a referral fee.

5. Meet with contractors

All types of real estate investors work with contractors, from flippers to large multifamily developers. If projects go south or investors run out of money, contractors can share potential real estate deals with you.

6. Partner with title companies

Don't just think of title companies for closing deals. The best ones work closely with real estate investors and offer support. These companies often have access to expensive data software and can pull reports on potential motivated sellers.

Reports can include data on absentee property owners or people behind on their mortgages. Once you have this information, you can contact the owners via a direct mail marketing campaign.

7. Spread the word about your investments

Finding off-market properties starts with letting people know what you do and what you're looking for. Even if real estate investing isn't your full-time job, share that you're an active investor. Do this in person and use social media to showcase your projects and interests. For example, if you flip properties, share before-and-after shots — people love them!

Spread the word about the types of properties you focus on and how you can help solve property-related challenges. The more people know about your work, the more likely it is that you'll hear about potential deals before they hit the market.

8. Explore real estate auctions

Auction websites can also be a good source for real estate deals. Just be cautious, since many properties are sold as-is, and you might not get a chance to inspect them in person. The last thing you want is to think you got a great deal, only to discover it's a money pit.

Some auction websites to check out include:

• CREXi: CREXi specializes in commercial real estate, including retail, office, industrial, and multifamily properties.
• Ten-X: Provides a range of commercial and residential properties, including office buildings, retail spaces, industrial properties, and single-family homes.
• Hubzu: This site focuses on residential properties, including single-family homes, condos, and townhomes. It often features foreclosures and short sales.
• HUD: The US Department of Housing and Urban Development holds auctions for residential homes previously part of the FHA program.
• IRS: The IRS auctions various property types seized due to tax noncompliance, including residential homes, commercial properties, and vacant land.
• Xome: This site lists residential properties, such as foreclosures, bank-owned properties, and short sales.
• Auction.com: This platform provides access to residential properties and detailed inspection reports that you can review before bidding.
• USDA properties: The USDA auctions rural properties, including residential homes, farms, and undeveloped land.
• US Department of Treasury: The Treasury Department auctions various types of properties seized due to legal actions, including residential, commercial, and industrial properties.

9. Drive for dollars

This is a tried-and-true strategy for real estate investors. Drive through target areas looking for signs of neglect or abandonment, such as overgrown lawns, drawn curtains, and general disrepair. When you spot a potential property, use public records or a data subscription service to find and contact the owner.

For the best results, drive the same areas on a rotating schedule and track changes. This helps you sense market shifts and spot opportunities over time.

10. Use direct mail marketing

Buying a list of property owners and sending out direct offers can reveal interested sellers. This can be a viable strategy in any situation, as you never know who might want to sell without going through the regular listing process. To maximize your time and budget, test different approaches:

• Mail format: Determine what works best in your area. Is it a postcard? A letter that looks handwritten?
• Messaging: Experiment with different wording and check real estate forums for successful examples.
• Specific neighborhoods: Start with a few sample areas to track response rates.
• Specific property types: Consider targeting properties that might be harder to sell, like homes with solar panels, which can be challenging to sell because buyers have to qualify for both the home mortgage and the financing or leasing of the panels.

11. Search public records

Your local county website has public records data on houses that are behind on their property taxes. This indicates potential challenges with property owners' situations, creating opportunities for investors. Here are a few details about tax liens:

• Priority: Tax liens take priority over mortgages and other debts.
• Acquisition: Investors can buy tax lien certificates at local government auctions.
• Remedy for non-payment: If the property owner fails to pay back taxes within the redemption period, the investor may foreclose and take ownership.
• Timeframe: States set different redemption periods, usually ranging from 6 months to 3 years.
• Investment potential: Tax liens offer a win-win opportunity. If the owner pays the taxes, you get a good return on your investment. If they don't, you have a chance to buy the property below market value.

12. Use door knocking

This strategy involves walking through neighborhoods, knocking on doors, and chatting with homeowners. Real estate agents use this approach to develop leads, but investors can also use it to find off-market listings. The key is to have a flyer or door hanger that explains that you're looking to buy property. Your flyer should present reasons why the homeowner should call you, such as:

• All cash, quick close.
• No need for repairs or renovations.
• Flexible move-out dates.
• No real estate agent fees.

If you don't want to door knock, you might also be able to hire someone to hang the fliers.

13. Check out online sites

If you are a member of real estate forums and communities, you might be able to find off-market listings through these groups. Get to know members of the community and post information on what you're looking for.

Sites to check out include:

• BiggerPockets: A popular platform for real estate investors with active forums and networking opportunities online and in person.
• Facebook: Join local real estate investing groups and also look for deals on Marketplace.
• LinkedIn: Connect with other investors and industry professionals.
• Reddit: Subreddits like r/realestateinvesting can provide leads and advice.
• Craigslist: Check the real estate sections for potential off-market deals.

Managing your off-market property

Once you buy an off-market property and add it to your portfolio, you need a good strategy to handle ongoing operations. This is where property management software comes in handy — tools like Azibo help landlords and real estate investors run their rental properties more smoothly.

Azibo makes it easy to:

• Collect rent online.
• Screen tenants.
• Manage leases.
• Track income and expenses.
• Generate financial reports.

Using this Azibo allows you to focus more on growing your real estate business and less on day-to-day management tasks.

How to find off-market real estate deals

Finding off-market properties takes work but can lead to great investment opportunities. These deals often come with less competition and more room for negotiation. Using the strategies we covered, you can expand your property search beyond the MLS and potentially find properties at better prices.

Success in off-market deals often comes down to building relationships and staying persistent. Develop your network, stay visible in your target markets, and be ready to act when you get a hot lead.

Try different strategies and you'll get better at finding and closing the right opportunities to boost your real estate portfolio's performance.

How to find off-market properties FAQs

What is Remine for real estate?

Remine is a real estate platform that combines property data and predictive analytics to help agents find leads, track properties, and streamline workflows.

How do you know if a property is at full market value?

A property is at full market value if its price matches recent sales of similar properties in the area, considering condition, location, and market trends.

How to find off-market properties in NYC?

To find off-market listings in NYC, network with local real estate agents, join investment groups, use direct mail campaigns, monitor public records, and check out websites that host property auctions.