How To Find Motivated Sellers In Real Estate
February 4th, 2022
One of the first keys to success in real estate investing is finding motivated seller leads. Finding a good lead is a multi-step procedure which requires both investigation and action. If you're just getting started as a real estate investor, understanding where to look and what signals to look for will help you land your next deal quickly. If you are looking to find an investment property under market value then read on to gain some understanding on how to find motivated sellers, negotiate, and finally close.
What are Motivated Sellers?
A motivated seller in real estate is a property owner who has a compelling need to sell their home -- they don't just want to sell their home, they need to! More often than not, motivated sellers are working to fulfill a tough deadline, so timely investors are able to take advantage of this tight timeline. As a cash buyer real estate investors can buy for a discounted price if they can close quickly. The pressing need to turn the home into cash drives the property owner to sell quickly.
Generally, if you can find a property with a motivated seller, they are willing sell their property to you, the investor, in very favorable conditions. As a motivated seller their need may allow you to purchase a property with no money down, no interest, or possibly seller financing.
Why are they Motivated?
The following are some of the most typical reasons why a property owner might be a motivated seller.
Life Circumstance: Separation, divorce, birth, or the death of a family member are all common situations which could result in a seller needing to offload their home quickly.
New Job: The property owner may desire to sell their home quickly if they got a new job and need to relocate.
Expensive Renovations: When a home becomes run-down, the owner may not be able or willing to spend money on the renovations or repairs. Most motivated sellers prefer to sell their distressed properties as-is.
Foreclosure or Pre-Foreclosure: When a homeowner falls behind on their mortgage payments or property taxes, it is likely that they're having some financial difficulties. This could indicate that they'd like to sell their home quickly to avoid foreclosure or large penalties.
Inheritance: Probate is a process of distributing assets after someone has passed away. Often times attorneys that practice in real-estate law have information on real-estate that may be sold through this process. This generally happens if an heir is unable to cannot manage an inherited property, they will be likely want to sell it off as soon as possible to unload the burden. Many of these homes will need renovation before they are ready to sell on the real estate market.
Zoning violations: The motivated seller could have a zoning violation. This is when a property doesn't meet the regulations as governed in the zoning ordinances specific to each city or state. The most common zoning violations are inoperable vehicles, occupancy, junk, trash, unkept lawns, or poor building condition.
Tired Landlords: After years of collecting investment property, landlords find themselves with a large collection of properties. These motivated sellers can no longer manage their investment properties and want to simplify their lives.
Delinquent taxes or a Tax sale: This is a situation where the liens themselves are auctioned to the highest bidder. As the highest bidder you have the right to collect the liens, plus interest, from the homeowner. If the homeowner can’t pay the liens, you can foreclose on the property.
Vacant Homes: This property type is vacant, the homeowners moved or the tenants were evicted. Every day the home sits unoccupied it is costing the owner money, which could make them highly motivated to sell the property.
Motivated Seller Leads: How to Find Them?
Instead of contacting every property owner in their target location, seasoned real estate investors generally look for motivated seller leads to focus their marketing efforts on.
There are several ways to find motivated seller leads, including but not limited to:
- "Driving for Dollars": Driving around your area looking for properties which appear to be vacant and recording their information.
Signs of vacancy include:
- Dilapidated appearance -- Un-mowed grass, broken windows, etc..
- Accumulation of newspapers or mail
- Shuttered Windows
- "Bandit Signs": If you've done any driving around a city, you've seen these signs on the corners of popular intersections. These are simple little signs which say they are interested in purchasing your house as-is and give a phone number to call.
- Lead Lists: There are many companies which have curated lists of motivated sellers available for purchase. USLeadList is one such company. We find motivated sellers because we are investors who sell the data we use to buy real estate. Through our proprietary data processing and unique sourcing, we provide real estate professionals with the most effective motivated sellers list available for purchase.
You've Got Your List of Motivated Sellers -- Now What?!
After you've acquired your list of motivated seller leads, it's time to create a marketing plan to reach out to these homeowners. You want to craft a message which will communicate the correct message to these sellers to enhance your chances connecting with motivated sellers in a way that is unique and pertinent (ask yellowletter what they think). One way to do this is to consider the source of your list -- for example:
- Is your property list sourced from driving for dollars?
- Tailor your message to mention the vacancy of the house, the shape it is in, and how you can take it off their hands.
- Is your property sourced from a list of absentee owners?
- Craft your message and mention how you can ease the burden and be a local owner.
NOTE: You'll want to be a little careful about this. Some people don't respond well to being contacted about their private life by strangers. Always be tactful, respectful, and kind.
There are several difference ways you can get in contact with these property owners, including direct mail, email, phone calls, your website, or other digital alternatives. Some of these methods may require some skip tracing to get phone or email information about the property owners. Find a tactic that works best for you and be persistent in promoting your cause.
Despite technological advancements, direct mail marketing remains a highly successful method of reaching motivated sellers and it is what we recommend here at USLeadList. Direct mail marketing is a a voluntary and non-obtrusive method which allows the property owners to contact you at their own pace. If you are considering a direct mail campaign we recommend www.yellowletter.com. They have over 20 years working with direct mail marketers. Their experience working to craft direct mail marketing pieces are sure to help you in your process of finding motivated sellers.
What To Do When You Get a Call.
When your direct mail campaign nets you a hot lead, we have a few tips to ensure that your conversation with the homeowner is both pleasant and productive.
- Make sure your voicemail system is working -- When you get a call you want to be sure you can hear the property owner's voicemail message clearly.
- Answering calls directly is the best tactic when starting out. You need to create your own connection with the motivated seller and practice navigating these conversations.
- Collect Contact information and the property address from the homeowner.
- Create a connection. Everyone loves to talk about themselves. If you can ask good questions about their life and circumstances, the seller will feel more understood and be more willing to work with you.
- Always get the seller to suggest a price first. When negotiating for price, it is best to have the owner provide the price that they think is fair. This gives you understanding of how motivated they are.
- Offer convenience, let the motivated seller know you are willing to buy the property quickly. You could offer to cover closing costs.
While you don't want to bombard the property owners with regular contact, failing to follow up is one of the biggest blunders you can make.
Make a note on your calendar to follow up with your leads, whether by direct mail, phone, or email. This is important because building trusted connections takes time, and not all of your leads will be ready to sell right away. Some properties will be in probate, some homeowners are in no rush to sell, and still others initially don't want to move, but then have a change of heart later.
Once you've planted the seed, it often takes time for a lead to feel ready to sell. Maintaining contact with your leads will allow you to catch them at the perfect moment -- We recommend that you reach out to the property owners every 3-4 months.
The vast majority of wholesale and flipping deals begin by finding a motivated seller who is looking to offload their property at a bargain price. The hardest part about this business is finding these motivated sellers and closing those deals.
USLeadList helps make this process simple we curate a nationwide list of motivated leads. Our proprietary pre-probate list is the product of many years of research and development. We created a direct mail list which targets homeowners who are older, have equity, and are in a position to sell or invest. The best targeted list to buy to find motivated sellers. We have fresh, real estate leads every three months and our research has shown that 60% of these homeowners will transfer title in the next year. These truly are motivated sellers and you can't get this real estate lead list anywhere else. Our job is to find motivated sellers. Real estate investors have trusted www.usleadlist.com to help create wealth for the last 16 years.
These motivated seller leads are the best solution for:
- Real-Estate investors
- Real-Estate agents
- Real-Estate Brokers