In this article, I will share the ten best driving for dollars ideas that will boost your ability to find better off-market deals in your neighborhood. It gives you access to potential property deals that other real estate professionals are not paying much attention to, and you can take advantage of that.
Many of the properties you will find in this process would not be listed on the MLS listing or advertised as for sale. These owners either can not sell their homes or don’t want to sell them right now. But with a good offer, they may do so. Your work here is to find those deals using this strategy and make good money from it.
What is Driving for Dollars in Real Estate?
Driving for dollars is a strategy that real estate investors use to find off-market property deals that are not listed on the agent’s data, or has expired the listing time, or were never advertised on the market as for sale. In simple words, those properties that you can not buy easily without convincing the seller with a good offer.
This strategy involves driving, running, walking, biking through the neighborhood, and looking for distressed properties or a house that need repair soon. After identifying those homes, you will write them down with the address and a few details about the house, and then you will research it and make an offer if it suits your investment criteria. That is the whole concept of driving for dollars in real estate.
Ten Driving for Dollars Ideas to get more Off Market Deals
But let me tell you, it is a time-consuming task, and most of the time, you will feel frustrated if you can not identify a single house in a whole day. But it can be a great way for new and experienced real estate investors to find motivated sellers who are ready to sell the house for below market price. Here are those ten ideas for you to apply.
Table of Contents
1. Choose a Good Neighborhood
First, choose a good neighborhood where undervalued homes are available. You may not find them in one look, but if you drive there regularly when you go to our office or take a walk in the morning when you exercise, you may notice those homes. The idea here is to visit every road in the area and try to identify a potential deal.
Create a habit of going to those areas on a regular basis. It may take weeks before you identify a good opportunity. You may also schedule some time when the is a local festival to know how the area has changed. It may give you some more info about the area.
2. Find an Under Valued House
But how do you find an undervalued house, and the seller is motivated to sell it at that price? Here are signs that professional investors use to identify those homes.
- Homes that are not too eye-catching.
- Homes that stand out from other homes in that neighborhood for their bad condition.
- A lot of investors are avoiding that house for problems.
- Homes that need a landscaping fix soon.
- Homes with broken windows and shutters.
- The paint has faded.
- Any notices posted on doors.
- Uncollected junk mail and newspapers.
- A house with a log of garbage.
If you find any of these in any house, know it could be a potential investment for you. Do the necessary research and then learn how good the investment is. Here is your next step in this research.
3. Research the Local Market
Now you have got a list of distressed properties. It’s time to do the due diligence on them. Go and check the following in your analysis.
- Check public records to know the history of the home.
- Check the MLS listing history.
- Do a skip trace to find the contact info for the owner.
- Research about the previous owners.
- The laws and regulations in that area.
- A physical overview of that house.
- Similar homes in that area and their data.
- Ask your agent to help collect more sat on that.
The due diligence process is huge, and this is the basic list that you should follow. Now move to the nest driving for dollars point.
4. Identify More Distressed Properties
Look my friend, finding a few distressed homes might not be enough. You have to find more. Who knows you may find a better deal with more options to make money. As a thumb rule, you must look for 30 homes and then select 10, and then finalize 3, and buy just one. That way, your investment will almost become ideas. (If you are an experienced investor, it does not apply to you).
5. Know if the Seller is Motivated
Now the main game begins. If that seller is not motivated, all of your analysis will go to waste. Although, you can motivate him by offering more money. But that will eat up your profit. The best solution is to find a problem the seller is trying to solve and use that problem to offer a solution.
When researching, you have found that the seller wants to move to a new place for his job relocation or leave this country and settle in a new one. That is why he wants to sell it faster. You can offer him quick money and help him leave the place soon.
The problem can be anything, but if you can solve it, then the seller will become motivated and sell the house for under-market value. He needs money soon, and you are offering that in cash.
6. Collect their Data using Skip Tracing
Skip Tracing means finding all the contact information about the seller online. There are some free and paid Skip Tracing tools that you can use to find those contact info.
Only use this after you have analyzed the person on social media and ask the neighbors for a ph no. If nothing helps, then you can use this tool, as there are some laws in every state on how you can use that info in your business.
7. Use Door Hangers
You can also use door hangers to inform the owner that you are open to buying the house. Direct mail can also help in this endeavor, but the effect is the same. This marketing idea is cost-effective and works very well. Print some ads and use them with that hanger for more effect on the marketing effort.
8. Do the Follow-up
After letting that owner know you are eager to buy the house update your marketing list and be ready for a follow-up. Just calling one time or sending a door hanger may not work. To make them notice, you have to do it many times. Continue this process and update your CRM until the seller also becomes eager to sell it. Follow-up is necessary if you want to have the best deal.
9. Make Your Offers
Now make your offer and show the data analysis you have found on the house. Ask for their price, justify that with the data, and let the negotiation begin. Respect the owner and his views and offer the best price you can give them. Most people will agree after a few days or weeks if he is motivated. If not, you can not do anything but wait for the response.
10. Follow a Checklist
If you want to become successful in driving for dollars, you must create a checklist for it. What to do, how to do it, what to check, and all the necessary things an investor does. Create and follow when you go for a drive. It will make the process much easier for you.
So these are the best ten driving for dollars ideas you can use to boost your marketing effect and find more off-market deals. But know this process involves much effort, and not every house you analyze will be a good investment. It means much of your time and money will go to waste. But one house may make up for it. It’s a tough idea but possible for everyone.