This is going to be short and sweet today. I ran across a potential deal about a week or two ago, which I am following up on, for four duplexes about a block away from where I already own/manage property. But these properties were not on the market, there is no MLS listing, for sale by owner sign, advertisement in the paper, etc. I found these properties through a tenant connection, which I will explain in a minute.
Before I move on, I want to give you some help in finding your own deals. I have talked about some of the different types of properties to look for, that would typically be sold for less than market value. Properties like HUD repossessions, and multifamily properties are some examples. The tip I am interested in discussing today involves one of these strategies – Farming Markets.
Farming markets is an old technique for finding investment properties, however, the method I am abdicating today goes beyond just looking for realtor signs and for sale by owner signs in neighborhoods you are looking to invest in. This tip is about making something out of nothing. It is the process of finding a property(ies) in the neighborhood you are looking for, and then contacting the owners, building a relationship, and getting a deal. These are properties that ARE NOT FOR SALE. This is what I mean by making something out of nothing.
I think the best way to illustrate what I am saying here is to finish the example I started earlier. What happened was this – I had a tenant that was moving out of one of my houses, and moving into one of the four duplexes I was talking about. During her due diligence, I ended up talking up with the owner/manager of the other duplexes. Sounds pretty normal huh? It was, however, by the tone of her voice and things she told me, I thought there might be an angle there. She was out of town, her job was not going well, and she didn’t have any reliable help here to keep her tenants happy. So I asked if she needed a property manager here, and/or if she would be willing to sell. She said she was open to either.
So now, all I have to do is get a face to face meeting with her, and see if I can work out a deal. No signs, the property not for sale, and yet, there is a deal to be done. I will give you an update later, as this deal develops.