Thinking Out Loud: Creative Ways to Find Off-Market Real Estate Deals

Off Market Deals

[00:00:00] James Rippeon: Today, we're gonna be talking about finding off market deals. You know, the elusive golden nugget that every real estate investor is looking for. We know that's the best way to find equity, best way to find value, add opportunities. Especially in this market,

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[00:00:44] James Rippeon: and James. We're going everybody walking back to another installment of thinking out loud on the real five podcast.

[00:00:51] I'm James rap. I'm here with my cohost Patrick McGrath. How's it going, Patrick? 

[00:00:56] Patrick McGrath: Ah, it's going great. James going great. Looking forward to [00:01:00] our topic today. That's for sure. Yeah, 

[00:01:02] James Rippeon: I think we have a good one. So today we're gonna be talking about finding off market deals. You know, the elusive. Golden nugget that every real estate investor is looking for.

[00:01:10] We know that's the best way to find equity, best way to find value, add opportunities, especially in this market. You know, you're looking at the MLS. Things are getting multiple offers. Things are being bid up. Things are getting crazy expensive, and there's definitely a lot of value to be found off market.

[00:01:27] So, you know, we thought it might be a good time to kind of chat about what some of those strategies might. To find those deals. I know that I've done a couple off market deals myself. You know, whether it's working with wholesalers or finding them my own or my own. But I think, I think it's gonna be a good, timely topic to discuss.

[00:01:46] Patrick McGrath: Yeah, couldn't agree more. I mean, I know that I've done a couple Mar off market deals. I'm currently in the process. Trying to find another one or two right now. Just like you said, I [00:02:00] mean, everything that hits the market is either extremely overpriced for what it was six months a year, two years ago.

[00:02:08] Or is just getting bought pending within the first couple days. So you you either have to be looking every day or be willing to. Overpay to, to get a deal right now. And I know everybody, everybody that's out there is kind of going through the same thing. So how do you get that edge over, you know, your average investor?

[00:02:29] And I think that's what we're gonna try to bring to you today is the steps that we've taken in the past to be able to get those off market deals, kind of what they look like and the benefits over. Trying to compete with everybody else off the MLS and with a real estate agent. So James with that what's the first way you would approach trying to get an off market deal.

[00:02:57] James Rippeon: There's just so many good [00:03:00] routes to go to choose from, but I'm gonna, I'm just gonna talk about first, the most obvious one and we can springboard from there. Wholesalers. Relationships, you know there's people who are out there looking for off market deals trying to find the value to add to you as an investor.

[00:03:14] Now, you know what, as a wholesaler there, there, there buyers out there going around finding. Off market deals and they're kind of acting as middleman, getting them on their contract and then finding you as the buyer to purchase the deal from them. And I think they're a great resource for you to find deals that offer a little bit more opportunity.

[00:03:32] They're always looking for distressed opportunities, distress deals. Things are, people are going through divorces. You know, they have debt, they have some other. You know, problems that they're facing in life, and they're very motivated sellers, and that's what wholesalers are gonna do. They're gonna go find those deals, get them under contract you know, and off sell that contract you and assign it.

[00:03:51] And that's how, you know, a good off market deal opportunity might pop up. Now you're gonna have to know these wholesalers there's gonna be to of them [00:04:00] in every market. There's gonna be some that are good. And a lot that are terrible and not doing any deals, the good ones are gonna stand out right away.

[00:04:08] Like they're doing a lot of deals. They have a lot of deal flow. They're gonna have preferred buyers. So it, at some point becomes a relationship game. You know, if you can get to the top of their buyer list and know how to work with them and establish a good rapport you're gonna have a good relationship with wholesalers, but yeah, that would be the first one I would talk about.

[00:04:26] There's a lot of good strategies with the vetting wholesalers and, you know, looking at the deal itself. That's the first one. I think we should probably devote some time to what do, what do you think about wholesaling? 

[00:04:37] Patrick McGrath: Yeah. I've kind of went over this a couple times on my page, but I personally have not yet bought a deal from a wholesaler.

[00:04:45] Not that I don't see the value in that I'm on list. I get text messages and emails almost on a daily basis of deals that are out there. And again, These wholesalers are finding properties that nine times outta 10 in their [00:05:00] current condition cannot be listed on the MLS, or it's not gonna be the best route for them to be listed on the MLS because they are distressed or have tax liens or behind mortgages and all these, all these different items that the average buyer out there with an FHA loan can't close on a deal.

[00:05:22] So there is, there is a ton, a ton of value in that. And a lot of times, not always, but a lot of times these wholesalers sailors. They don't have the funds to be able to do the deal themselves, or they're trying to get more funds together to do a deal themselves. So that's, you know, you've listened to bigger pockets.

[00:05:47] You've seen other people out there talking about the best way to get into real estate with little or no money is to start wholesaling and bird, dog, and deals. Trying to partner up with somebody else. And I think [00:06:00] that's that's the good part about wholesaling because that's their job. They're dead.

[00:06:04] Dedicating all of their time to find these good deals. So why not reach out to someone who that's all they're doing? And there's a lot of different places to find wholesalers number one, which is where I found them is at your local real estate meet. I know we've talked about this before, but you know, James put on a great real estate meetup.

[00:06:29] I know he has another great one where he is living right now. And there's always wholesalers at these different that at these different meetups and nine times outta 10, you give him an email address or your phone number and they just start sending deals out to you. You know, they're on they're they're on your.

[00:06:44] Another way to find a list of wholesalers is typically every market has a Facebook group, an investor Facebook group, and you can go on there and say, Hey, add me to your buyer's list. And [00:07:00] you'll start, you'll start getting emails. You'll start getting you start getting messages every day. I mean, they're the only way that they make money is.

[00:07:09] They assign a contract to somebody else that can close. So it's pretty easy to get added to a list to get higher and higher on that list though. You gotta be serious and you've gotta be able to close on these deals really quick. One of the really quick, so. You have to know about how to close on these properties, which is nine times outta 10, gonna be with private money or hard money, money lender.

[00:07:38] Wouldn't you agree? Yeah. 

[00:07:39] James Rippeon: I would agree. Hundred percent. You and you're touching about on something that I was gonna bring up is, you know, my, my thoughts with wholesalers and new investors getting into the game is I would almost recommend that first time deal buyers not use a wholes. Because you're gonna have so many things thrown at you without you really knowing what you don't know.

[00:07:59] And when you're going the [00:08:00] whole sale rate route, can't even talk when you're going the wholesaler sailor route. You're not being represented in most cases by real estate agent and your agent is gonna be the one cuing you into these things that you need to be aware of. When you're going through the due diligence period and getting these deals done.

[00:08:17] And you know, when you, when you're doing a wholesale deal, they're going a million miles an hour, like from contract to like closing in two weeks, these wholesalers wanna get these things closed as quick as possible. So you hinted out this earlier. You're probably gonna be using cash, probably gonna be using hard money.

[00:08:36] Not a lot of wholesalers wanna work with conventional or other types of loans because it just stalls stalls up the process a little bit more. Good, hard money lender. Shouldn't have a problem closing two, three weeks. But yeah, I mean, there's, there's gonna be trade offs for sure. So, you know, your experience level, you know, not knowing what you don't know, what kind of traps you can get yourself into.

[00:08:57] There's all things you need to be aware of. So sometimes I [00:09:00] suggest, you know, first deal, first time deal buyers, you know, maybe just go off the MLS or find some other route to go because you know, the, the, wholesaler's not gonna know everything about the property, cuz. They're almost trying to be blind to what the condition is, you know, exactly's wrong with it, you know, you're not getting the disclosures, you would otherwise get an MLS listing.

[00:09:19] They're just simply middle men and that's kind of where the value comes from. So it's gonna be trade offs. 

[00:09:24] Patrick McGrath: Yeah, no, and I mean, especially one of the biggest things you hear about wholesalers is their numbers. Their after repair value, their renovation, numbers, and all of that. They're professional deal finders.

[00:09:38] They're not professional, rehabers flippers, right? Rental property owners nine times outta 10, the best ones they're keeping the best deals for themselves. Or they're partnering with somebody 

[00:09:48] James Rippeon: who they work with and getting a deal done that way. 

[00:09:50] Patrick McGrath: Exactly. So you're not even gonna be seeing those.

[00:09:53] So the ones that, and. The deals that they're not taking on themselves. They probably have the top [00:10:00] two or three people that they deal with that are getting the next level of best deals that they're not keeping for themselves. So you're get, you're like getting the third and fourth tier properties that are getting blasted to you in an email or a text message.

[00:10:14] So with then like, then you really have to know the numbers on the deal, the area and everything else. And then. You really have to know the numbers and how the hard money, private money loan side works as well. So there's these two completely different beast that, you know, you're kind of throwing yourself into now.

[00:10:36] Yeah. The hard money lender will, you know, let you do 10% down on a deal and fund 90% of the entire deal, which sounds great. But how do they make their money by the interest on the loan, on the deal? So if it goes over. Yeah, if it, and, and the points, I mean, three, four points. So yeah, wholesaling is definitely a way to do it.

[00:10:58] I would totally agree [00:11:00] with you though. You know, maybe not for your first deal, but James, if you're trying to do your first deal and we kind of scared you off with the wholesaling route, what is the second best way that you would look for to find a deal? 

[00:11:16] James Rippeon: Yeah, there's. You know, wholesaling's a great route to go.

[00:11:19] Just buyer beware. Literally. Now this is something that I did when I first got started in real estate. It was a fantastic thing to do, learned a lot, doing this, doing it this way, learned to negotiate, learned how to, you know, analyze properties. I did a whole bunch of mailers direct mail campaigns.

[00:11:38] The way I did it personally was. Print it print it out letters. I would hand sign every single one, put labels on 'em kind of give a personal touch with the signature by pen, but pen signature, send them out, you know, send 'em out to, to people who own the properties you wanna buy and you're gonna get calls.

[00:11:56] Now, now we're dealing with like [00:12:00] time investment and energy going into finding off market deals. If you do it right, you're gonna get a good conversion rate and you're gonna have leads coming through your pipeline, but you need to be able to close and you need to be able to convert those leads. So you need to be available.

[00:12:15] You need to be able to commit some time, but mailers, I think are a fantastic way to go about that. I've done tons of mailers and I've probably wholesale. Three deals personally from mailers things that I came across and didn't end up buying wholesale, them to other investors had bought our own deals, doing it this way, just mailers.

[00:12:35] And I'm also doing it for my real estate business as an agent to find needs for listings and buyers and things like that. So it's, it's something that I feel like not a lot of people do personally, but offers a lot of opportunity. 

[00:12:49] Patrick McGrath: I agree with you. As you all know, I have also found deals, closed deals from postcards and sending out mailers.

[00:12:57] The best part about this route is you get. [00:13:00] Access directly to the seller of the property or potential seller of the property. And this really helps you out in the negotiations because now if you dive down and you do a really good job, you can find out their motivation, what they're trying to do.

[00:13:18] If they own the property outright. What their ultimate goal is why they're selling the property. If the property has issues, Hey, when's the last time you did the roof? You know, I want to give you an offer. When's the last time the roof was done. Have you done any major renovations and you can find out all of that stuff.

[00:13:36] By just having a conversation with them. And now you're having a conversation with another investor and they know that you are an investor and that you need to make some money as well. So you're already starting off on a good foot. With the negotiations and letting them know because you're buying it direct, Hey, I'm not just a wholesaler.

[00:13:57] Who's gonna assign your contract onto somebody [00:14:00] else. You know, like, Hey, I'm the me personally, Patrick, I'm the person that is, that is gonna be buying and closing on this deal. If you don't plan on, you know, wholesaling, the property doesn't make sense for you. So that's kind of my route that I go and I try to.

[00:14:19] Get a personal relationship with these sellers to where they want to sell to me. And that's kind of been the best strategy for me and it, and it's really helped me with these owner finance or seller carryback opportunities, which you know, off market deal is. You know, the gold standard, but then seller financing, owner financing, these, you know, seller carryback.

[00:14:46] I mean, that's like the diamond standard of, you know, a deal these days and the. 99% of the time. The only way that that's gonna happen is by sending out mailers or postcards [00:15:00] or dialing for dollars, you know, and calling these sellers directly and speaking with them. I mean, yeah, 

[00:15:05] James Rippeon: I think that's a hundred percent true, man.

[00:15:07] When you, when you form that personal relationship with the seller, you're gonna be able to better identify what their needs are and why they're selling the property. And you're gonna be able to use that to leverage a better deal for. So if they just need straight up cash real quick you're gonna get a better purchase price if they're not super to motivated cuz they don't need cash, but maybe they're looking to retire.

[00:15:28] Maybe you can get that seller financing worked in there. So when you're, when you're looking at this deal not on MLS and not through a wholesaler, you're gonna have more flexibility with the terms and you're gonna be able to get those terms that work better for you as a buyer and then also the seller.

[00:15:43] So there's definitely a lot of negotiation that can. Play it out there. How, how do you do your mailers? Like, what is, what is your strategy specifically for, for finding those deals and opportunities? 

[00:15:54] Patrick McGrath: Yeah. So my mailers are directly done from the deal machine app. So [00:16:00] I typically just buy a list of my target properties.

[00:16:02] You can go on like list source or podium or prop, prop stream. There's so many different ones out there. Mm-hmm and then you can pick your target, zip codes. I try to do sales longer than 10 years ago. Yeah. Well, 

[00:16:16] James Rippeon: why is that important? I know exactly why you're doing that, but tell us why that's important.

[00:16:20] Patrick McGrath: Because someone has owned the property Long enough. And right now they probably have a decent amount of equity built up in it. They've owned it long enough where things could be starting to break. They could have tenant issues. They might not wanna renovate to get those market rents up. Right.

[00:16:36] So. And plus it could be an older and older person that you're, that you're trying to buy it from. Right. So that's one of the main reasons plus you're, I mean, if you buy something within the last two or three years, or you're sending out mailers to someone in the last two or three years, I don't really feel like you're gonna get that good of a deal.

[00:16:53] Right. 

[00:16:53] James Rippeon: Yeah. Too close. So I think that's important because. I think you call this like an anchor, their [00:17:00] anchor for the purchase price is gonna be what they bought that place for in 1995, 2005. Not 2005 is a good example, cause things are going crazy, but you know, a long time ago and ideally things have appreciated since then.

[00:17:13] So, you know, the Delta for where they think their house is worth is probably gonna be closer to what they bought it for in some circumstances. So I think that's a good way to get value by targeting. Also, I think the average mortgage length before property is sold is like six to seven years or something.

[00:17:30] So that's how I always target. I try to at least six or seven years, I don't look for properties that are, that have sold or turned over earlier than that. 

[00:17:40] Patrick McGrath: Exactly. So that's typically the first one that I do. Then, you know, you wanna make sure that it's absentee owners, people that aren't living at the property.

[00:17:48] So that's, that's the second one. And then now in this stage of the game, I'm really only focused on multi-family properties. So then I'm targeting [00:18:00] triplexes and up just cuz I don't wanna deal with the duplex, you know, more units underneath one roof. You know, more cash flow. So that's, that's what I'm, that's my target.

[00:18:10] And that's what, that's what I'm going after. And then I send out a mailer every 10 days for six times. So I figure, you know, if I don't get a call after sending. you know, two months worth of mailers every 10 days then, you know, most likely they're not interested or I'll try a different route after that.

[00:18:30] But that's typically how I go after that. And I, I do my email and for me, I put my wife's name on the postcard because I feel like there's a better opportunity for someone to call Danielle than a Patrick. So little tidbit out there if you're gonna do mailers that's just my personal opinion, but I found that it works.

[00:18:52] So all 

[00:18:53] James Rippeon: of, a lot of this is psychology. You, you gotta approach it from that seller's perspective and whoever you're [00:19:00] interfacing with, you know, not just with this finding off market deal situation, but everything in life. So. I think that's smart. I don't, I don't find it dishonest or anything. It's, you know, it's a way, cause you two, are, you guys are working together in this business and you guys yeah.

[00:19:13] Mm-hmm yeah. So, but I think it's I think it's a smart thing to recognize that you want to present yourself and your materials and your advertisements in a way that's gonna resonate. And that clearly fits the bill here with finding off market deal. And that's kind of why I hand sign, you know, my letters that I did you know, the, the way I wrote them, the verbiage you're using everything that goes into this is gonna impact the, the viewer and therefore your conversions.

[00:19:39] Patrick McGrath: So, and I've also switched up. So I did just the standard, you know, one off of a deal machine last year. And sent those out. And so this year, a year later, I'm sending them out to the same people that I sent them out to last year. But [00:20:00] I changed the color. I changed the verbiage a little bit, you know, before it was just like, Hey, do you want a free offer?

[00:20:06] Now? It's like, Hey, I'm a local investor in the area. That's looking to purchase another property. So I changed the wording up a little bit just to see. That drives any more phone calls or that might spark someone different, you know, because these people are probably getting mailers from other people saying they want, you know, to give them free offers on their houses and everything else.

[00:20:28] So you're most likely not the only one doing this. But the pool is extremely small because it takes. You have to go buy a list. You have to upload that into your CRM. You have to send them out. You have to answer the phone. You have to be. You have to have some sort of sales, you know, to be able to talk to people, you, you gotta have a list of questions that you need.

[00:20:53] Right. The last thing you wanna do is get someone on the phone and then be like well, how much do you think you want? And everything [00:21:00] else I did that, I was like, holy crap. Someone actually 

[00:21:02] James Rippeon: called me. This is insane. Yeah, that was new, man. I had no idea what to say, what to ask, you know, I was, I was saying just such dumb stuff.

[00:21:09] Like how do you like your house? And like, just . Incredible things. So, but the thing is, you just need to do it. You just need to do it and keep doing it. And you're not gonna know what the hell to say until you do a couple of these. You go do some site visits, you see what you're looking at? You just need to do it.

[00:21:25] And don't stress your out stop. Don't stress yourself out. Try to do it perfect the first time. You just need to take on those repetitions 

[00:21:32] Patrick McGrath: exactly. Hundred, hundred percent. So with that being said, The deal I'm about to close. In the next two weeks came from a postcard. So I spent probably $2,000 sending up postcards last year, and I've got two deals that I'm gonna close this year off market from postcards right now, the average unit price on the MLS or [00:22:00] any commercial property is trading for around a hundred to $110,000 a unit.

[00:22:07] And I am buying these properties. 70 to 80,000 a unit. So you're getting a, you have the opportunity to get a great discount and all of these properties come with seller. Carryback where I'm bringing, you know, 5% to the table to buy these properties. So my cash on cash return number becomes ex becomes huge, exponential Then over something that I could have gotten off the MLS or bought with commercial financing, 25% down.

[00:22:42] Now I'm able to acquire more properties with the same amount of money. So you know, it, it putting in the effort and the time and it, it it, it's not gonna happen overnight. Like a, a lot of these things are taking, you know, six months, nine months a year from that first phone call. [00:23:00] But at the end of the day, it it's gonna be worth it.

[00:23:03] So do what others won't, you know, so you can reap the 

[00:23:07] James Rippeon: benefits. Exactly. Yeah. You're gonna send these letters and postcards out and they're, they're not gonna throw 'em away immediately. Some people are gonna hold onto them. They might put it on the fridge and cuz they they're thinking down the road in their lives a couple years, even so.

[00:23:24] That's where follow up comes into play here, like sending these mailers more than once, and it's gonna take a lot of touches cause you wanna be top of mind when it becomes relevant for them. So the follow up is key for sure. Yeah, I mean, I think this is all great. We got great, you know, wholesalers, we got, we got mailers.

[00:23:41] What other kind of off market deal, search strategies. Can you think of, that's been the extent of what I've done, wholesaling and, and mailers, but I know there's a whole bunch of other stuff out there that people can. 

[00:23:54] Patrick McGrath: Yeah. So another one that has worked for me, I didn't get a deal, but I got in [00:24:00] touch with a couple sellers or potential sellers this way is in my area.

[00:24:04] We have a local like yard sale, Facebook page or community Facebook page. So like every two months I go into all of them and I just say, Hey, I'm looking to I'm looking to buy, you know, a rental property. You know, two to four units in this area, if anyone's looking to sell, you know, send me a DM. And usually it's not the person that's looking to sell.

[00:24:31] It's like someone that they know that they complain to or something else. And they like tag someone in there and then I send them a message. And I had a deal that I'd been working on for like two years and I tried to do Wrap wraparound mortgage or subject two. And I had never done one before.

[00:24:51] So that's why it was taken so long. Needless to say the, the deal didn't go through. Cause I didn't have the money at the time. And I was trying to do another really creative way of [00:25:00] buying a property that I'd never done before. But it got me in touch with some people and I mean, that's free, like go on all the community pages in the area.

[00:25:08] It's like, Hey, I'm looking to buy a rental property. Anyone, you know, anyone have any crappy tenants, anyone have any, you know, buddy that they haven't been able to evict because you know, whatever. And try to find someone. Has a really big problem because people who have rental properties that are selling them, either one are trying to cash out, retire two, they have a giant issue that they don't want to deal with anymore.

[00:25:37] Or three they're looking to upgrade. To something else. Those are typically like the three big things, right. That someone's gonna sell you one to, why else would they sell you the property? If the cash flow is great, the tenants are fantastic, you know? So you're buying problems. So be a problem solver and take that on.

[00:25:56] So I mean, that's a free way to to [00:26:00] find off market deals. And then, you know, same thing with the wholesale. You could do text messages, you know, you could do phone calls but really also reach out to some local real estate agents that just focus on rental properties and just let them know, Hey, I'm looking to buy a property.

[00:26:17] I'm not gonna sign an exclusivity agreement with you. I just want you to know that, but if the right property comes along, here's what I'm looking for. Send it my way. And I've done that too. And so now I have some real estate guys in the some realtors in the area that start sending me properties.

[00:26:33] Cause I, I don't have time to look everywhere in Maryland for anything that pops up on the MLS or things. Aren't always. Listed underneath the multifamily that are multifamily, that they know, so things get listed wrong and they're not in your searches. And then you, you can miss things. So you know, those are kind of two free ways that you can go about, go about doing this as well.

[00:26:59] Yeah, I 

[00:26:59] James Rippeon: think [00:27:00] that, that's how I got first started in real estate. The first deal I bought was a MIS MIS I dunno what you. They put it in MLS, not as they should have. So it was three single families as a portfolio being sold and they just listed it as one. So when people were looking at this deal in MLS using their filters it was making it not appear for certain people and making it appear for other people as a wrong, wrong result.

[00:27:26] So it just had been overlooked and you know, it turned out to be a great deal. It was three houses for about $40,000 each in high point, North Carolina. That time is long gone. But that was probably 2018 ish. But yeah, I mean, if you can find value in MLS like that, that that'll be there while we're talking about it, properties that are mislabeled square footage wise, things that you could add fourth bedroom to there's are good thing.

[00:27:53] Good ways to find equity in, in deal and value. As 

[00:27:57] Patrick McGrath: well, I just so I just thought of one that I [00:28:00] actually used. People don't talk about this one anymore, but there's an old website called Craigslist out there. Really date yourself here, man. Yeah. People people used to before Facebook marketplace and everything else, that was the place that you would list all your stuff.

[00:28:16] So people still put stuff on Craigslist. And that's actually how I bought my first Plex and got my first off market deal. A guy had listed his portfolio on Craigslist and had his number there. So I just called him and started to chatting with them about it. And yeah, he ended up selling like three out of the five properties and I just kept calling him every month for like six months.

[00:28:41] Like, Hey man, I see the, have you, did you sell those other two properties yet? Oh, no. All right. Well, you know, we both know they're a little high, but when you're ready to talk. Let me know next month. Hey, see the property you still haven't sold yet. Like finally, like six months in this guy's like, all right, I'll sit [00:29:00] down with you.

[00:29:01] And we, we sat down and were able, we were, I was able to get a tri Plex and a quadplex from the same guy, and I found that off a Craigslist. So there's another tip for you on their Craigslist 

[00:29:15] James Rippeon: there. Yeah, same, same exact thing. Different looking at it from a different lens. For rent for rent properties on Craigslist and Facebook they're on Craigslist and Facebook because the owners are trying to rent it out themselves and they don't wanna pay a property manager for whatever reason.

[00:29:31] They're probably tired of being landlords. So call those numbers, you know, get on Craigslist on Facebook, find an owner who's trying to rent the property out themselves. Give 'em a call ask 'em if they've ever considered selling their property and just talk to them and I'm, I'm sure something good will pop out, pop up that way.

[00:29:49] Patrick McGrath: That's a great one. If you check out this week's episode, cause this is gonna be out next week. We have Evan who Evan, Phoenix, [00:30:00] his episode will be out. And that's what he did. He actually called a. For rent sign and was able to, was able to get a duplex done. Mm-hmm so Yeah, it works. It does work. That is that is a great one.

[00:30:15] Cuz you know, Zillow charges you now 9 99 for a week or 1499 for 90 days. So there's some cheap people out there that just wanna put it on Craigslist or Facebook cuz it's free and you know, call 'em all, make a list. I didn't know. 

[00:30:29] James Rippeon: Zillow charged you for that. That's good to. They 

[00:30:32] Patrick McGrath: do. Yep. Yep, yep. They sure do.

[00:30:35] But I think Zillow is the best one. Me personally. Yeah. Yeah. They're, 

[00:30:38] James Rippeon: they're, they're gonna become a sponsor. So I think another one that we kind of, we touched on, but it's worth repeating and just maybe going into a little bit more detail over other investors, those are gonna be a great source of off market deals.

[00:30:51] You know, the pain point that Patrick identified, you know, they're either trying to scale up or they're just terrible at being a landlord. Whatever the case they're gonna be a [00:31:00] source of deals and they're gonna wanna work with somebody that's easy to work with. So if you get to grow these relationships at these meetups, and maybe you meet people through your real estate agent that you're working with, whatever, I think other investors would be a really great source for, for off market deals.

[00:31:15] Cause they're probably gonna have a better idea of what the property's worth. You might not be getting like a slam dunk, super great deal with a bunch of equity. You're gonna get a fair deal and you're gonna work with somebody who's knows what they're doing might not be able to, you might be able to do it without paying a real estate aging.

[00:31:33] You might be able to save some fees things like that. So other investors are a good 

[00:31:38] Patrick McGrath: source. Yeah. And don't all right. This is the number one takeaway of this entire thing with off market deals. If you get in touch with a seller of an off market deal. The number one question that you should be asking is, do you have any other properties [00:32:00] that you would consider selling that is the number one after what's the address?

[00:32:06] how much are the rents? Like, do you have any other properties that you would consider selling? Because nine times outta 10, they have. Multiple other properties. And if they're considering selling one they're right now, they're wanna sell you their number one headache. So you take that off their hands and they're like, eh, well, this other one is because hasn't been that bad, but I consider selling that one too.

[00:32:31] And then all of a sudden now, you know, you went from buying one deal to two, or, you know, you sent him a postcard for this address over here. Not knowing that he's got 17 other ones. 

[00:32:45] James Rippeon: That's so important. I've seen that so many times sending out those mailers and the sellers will call you and they'll say, Hey, I'm not interested in selling this property, but I do have this other property that I've been thinking about selling.

[00:32:57] And they would be too completely [00:33:00] opposite properties. Like one would be a commercial space and one would be a multi-family or whatever, but, you know, the point is. it doesn't hurt to ask. You need to ask and follow up. Also ask if they know anybody else who's trying to sell real estate as well. You know, tho those things are not gonna be obvious to someone who's trying to sell you property.

[00:33:19] They're not gonna be thinking like that, but you never know what kind of answer you're gonna get. 

[00:33:24] Patrick McGrath: Exactly and like James and I both said, when you start, when you start getting some of these calls, you get called up, you're so excited. You're like, you've got that giant fish on the line and you're just like trying to make sure the line doesn't break.

[00:33:36] So you don't wanna like push too many buttons, you know, but at the end of the day, like, Hey, this is your, this is your opportunity, man. So take the shots, ask for the seller financing, ask if they have any other properties to sell, ask if they know anybody else that has any properties like this. If you can't come up with a deal, cause other investors hang out, talk shop with other investors that [00:34:00] have other properties and you.

[00:34:03] Everybody likes to talk about all their great deals and you know, the money they're making. But the second best thing they like to do is talk about all the issues that they have to deal with, what it comes with everything. So they'd be like, ah, I remember Steve was telling me about this tenant. He had the other day, he might be interested, you know?

[00:34:20] And and just re and I just remember, like, these things take a lot of time. So like pump the brakes a little. And, you know, get them their offer and then ask them when the best time to follow up would be, if they tell you not right now, like, Hey, all right. You know what? Maybe not right now, but is it okay if I touch base every three months, just to see, and then all of a sudden you'll have a list of like 10 people.

[00:34:48] That are thinking about selling, just not right now and just keep that conversation, keep that conversation flowing. Because again, when they are finally ready to pull the trigger, [00:35:00] hopefully you're the first person they think of. And that's not gonna get you a deal today. None of the things that we just talked about are most likely gonna get you to deal today or this.

[00:35:11] But you need to have a pipeline. If you're a long, if you're a long term real estate investor, if you're looking to grow a massive net worth and a huge, you know, amount of cash flow, you are gonna need to continually buy deals for years to come. So. You know, put all of this in your pipeline and you know, six months, a year, two years down the road, this stuff will start to pay off.

[00:35:36] If anyone who's ever been in sales with long sales cycles, you know, it's all pipeline, pipeline pipeline. So fill your pipeline full of these potential opportunities. And it, it will pay off as two people who have bought off market multiple off market deals. You know, it takes time, but it's, it's definitely worth it.

[00:35:57] And that's why I'm still [00:36:00] sending out mailers and still having these phone calls, you know? Cause that's where, that's where all the best deals are. What do you, what 

[00:36:07] James Rippeon: do you think as far as a good amount to spend on. Mailers and, and marketing. So I know you mentioned, you know, $2,000, I've probably done two, $3,000 a month.

[00:36:18] And I know some wholesalers that crank out 15 grand a month, 25 grand a month on, on you know, their deal flow. So what, how do you kind of think about like how much you're gonna invest in that to find off market deals? 

[00:36:32] Patrick McGrath: Yeah, so, I mean, I. I don't really have a budget on it. I've just really narrowed.

[00:36:40] My search down a lot. So there's only so many plexes quadplexes and you know, 8, 10, 15, 20 unit apartment buildings in my area. And nine times outta 10, someone who owns a 15 or 20 unit apartment building, you know, you're not gonna be sending it to their house. They have like a PO [00:37:00] box or some other crap.

[00:37:01] And you're kind of wasting your time, but it's worth the 50 cents to send it out. So I might only have a list of 250 people that I'm sending these things out and they're 50 or 60 cents. So, you know, that's where kind of my budget kind of comes into play and I'm targeting an extremely small area.

[00:37:18] Like I'm not blanketing all of Maryland and Pennsylvania and everything, you know, I'm. I'm targeting a very specific niche area. And I want to be the one that everyone in that market thinks of when they're looking to sell. 

[00:37:34] James Rippeon: I think that's super important, cuz that allows you to follow up much easier than sending to a hundred thousand properties.

[00:37:41] You're only targeting 300, makes it super easy to do that. Consistent mailing, that consistent cause everyone everyone's gonna sell their property at. Yeah, that's a guarantee. So I think that that's a great strategy to narrow down, know what you don't want, just as much as you think you might know what you do want.

[00:37:58] Patrick McGrath: Exactly. And another thing is [00:38:00] like I always tell people where I live, any investor that calls, you know, oh yeah, I'm right down the street. Boom. Here's where I'm at. You know, where we live in the same town. Same place. Oh yeah. I also have a property over here. I've got a property over there. We start swapping stories and everything else and everything else.

[00:38:20] If I was trying to do that in a place two hours away from me. You know, I, I couldn't, I couldn't do that. So it, it's a great way to connect really quick with some, with, with one of these potential sellers that, Hey, I'm in the community too. I live, I shop at the same place as you shop I'm right down the street, you know, I'm local.

[00:38:39] And that that's, that's the way that I go about. That's not gonna be for everybody. But that's just, what I've found has, has worked for me personally, and a lot, a hundred percent of the people that I'm buying from are older, you know, landlords and, you know, they see a little bit of [00:39:00] themselves in me and that's kind of my strategy to, to go for.

[00:39:06] And I, and I'm, I'm always always kinda. Talk, 'em up a little bit, you know? Oh, I, I ask like, how many properties have you had? How long you've even been doing it? Like, oh man, that's great. That's exactly what me and my wife are trying to do. Like that's our goals. And again, I make them want to sell to me, like as much as they're helping.

[00:39:25] The whole idea is I'm helping them sell their property for a fair, a fair deal if they wanna sell. And they're ha they're helping a young couple do exactly what they're doing. So then I can be in their shoes. You know, it's one of my lines at the time, man, I'm looking to be, I'm looking to be on your side of the table one day down the road, you know Because again, like then, and then I asked them, Hey, do you know any anybody else?

[00:39:49] You know? And, and it just, it makes the conversation go so much better. I mean, the seller that I bought my first property from two years ago, Danielle and I saw him out to dinner.[00:40:00] About two months ago, he came right over to the table. Hey Patrick, Danielle, how, how you doing? He ended up buying us a.

[00:40:07] Nicest guy in the world, you know, but we built this relationship. We're now haven't seen him in a while. And two years later he remembers us and he asked how how's everything going? So that's the type of relationships I'm trying to build with everybody. That's not everybody's strategy. That's not gonna work for everybody.

[00:40:23] You're gonna meet some. Asshole people out there are gonna tell you to stop calling, take you off your list and everything else, but you only need one, right? You really only need one to, to hit a home run or a double or even a single out there. So, you know, take action. That's what we say every, every day.

[00:40:42] Right. You know, pick one of these strategies. Decide, and then commit to doing it once a month, you know, send out 10 letters a week, you know, some just start small, so get committed and the taking action part. And then it's, it's gonna come. [00:41:00] It's gonna take some time, but you are doing the steps that everybody else out there isn't doing everyone else that is just willing to sit on their phone while they're watching Netflix and scroll through, you know, you're, you're gonna.

[00:41:11] A little bit ahead of them and that's, that's really all you need. You just need an edge just like in sports and everything else. You, you just need a little edge to, to put, to set yourself up in a better opportunity than everybody else out there. And I think today we've, we've given you guys enough tools.

[00:41:31] To give you that edge to, to find some off market deals. And then hopefully, you know, a year down the road, you're on the podcast telling us all about it. So 

[00:41:39] James Rippeon: exactly. Yeah. It's all gonna compound on itself. You just gotta take that first step, figure out what you're doing and stick with it consistently. And it's gonna compound you're see the results.

[00:41:51] So great. Well, Patrick, I think I think we covered a lot of great stuff here talking about how to find off market deals and kinda some good strategies to find [00:42:00] value in real estate. So is there anything else you think we need to talk about chat discuss before we hop off? 

[00:42:07] Patrick McGrath: I just wanna say everybody out there, we appreciate everyone who's listening.

[00:42:11] If there's any topics that you'd like us to cover on these thinking out louds we've got a pretty decent list, what we think everybody wants to hear, but for all you guys that are dedicated listeners, you know, actually checking us out. If there's any topic that you want, James and I, to kind of dive deep on send us an email.

[00:42:27] Shoot us a DM on Instagram. Please click that little follow button on Spotify, leave us a review. We really, really appreciate that. And I think that's it, James. Let's sign this bad boy off and on to the next one. All right, 

[00:42:41] James Rippeon: guys, let's kick the 95 till next time. See you 

[00:42:44] Patrick McGrath: guys.

[00:42:47] outro: Thank you for listening to the real fi podcast where you learn from the investors that have lived, the hard lessons for you to connect with us during your pursuit of financial independence. Be sure to join our community by [00:43:00] following us on Instagram or emailing us info@therealfi.com. If this content made you financially, mentally, physically, or spiritually rich.

[00:43:10] Please make sure to leave us a positive review on your preferred content platform. Cheers to kicking the nine to five.