There are several ways to find sellers who are motivated. Some are free and some require a little investment. Let’s look at the FREE ways first.
- Driving for Dollars – this is a popular one. D4D (as it’s sometimes referred to) is nothing but choosing a neighborhood that you’re interested in and driving each street looking for either vacant houses or houses with “For Sale By Owner” signs. You’re not looking for realtor signs because realtor contracts cannot be assigned and, usually, those are houses that are being sold at market value. As we discussed last week, when you’re wholesaling, you’re looking for houses that can possibly be bought for 30%-50% below market value ideally.
- Online – Though they’re not easy to find, some deals can be found on sites such as “For Sale By Owner” (FSBO), Craigslist, FB Marketplace and Zillow.
- Networking – Going to local REIA (Real Estate Investors Association) meetings in your area is a good place to find deals AND investors. Also, networking with service people in your community such as mailmen, yard guys, utility workers, etc. and offering referral fees for leads can be a good way to find deals. Let them know what you’re looking for and tell them you’ll compensate them if their lead(s) results in a sale. You’ll be surprised how people will respond to the possibility of making an extra $250-$500 if all they have to do is provide an address!
- Bandit Signs – Many wholesalers use bandit signs around neighborhoods and in high visibility areas such as street corners. All you need to write is a simple, “WE BUY HOUSES” and a phone # on the sign. However, you have to know the legalities of your area when it comes to bandit signs. Some cities only allow them to be posted in certain areas and at certain times like on weekends. Also, in order for them to be effective, you really need to put out at least 20-30 at a time around the city.
- Direct Mail – Direct mail is probably the most expensive form of marketing depending on how many pieces you mail at a time. The way it works is that you send letters or postcards to a list of owners in a certain area letting them know you’re looking to buy a home in that area and to give you a call if they’re interested in selling. It doesn’t have to be complicated. Here’s a sample message: