Real Estate Investing
How To Find Off Market Deals From Tax Delinquent Properties
In many markets right now, it can be really difficult to find quality deals through the standard real estate agent / MLS channel.
In fact, it’s so difficult that many investors have moved away from the MLS entirely for now.
There are a hundred ways to find deals off-market, but the easiest ways are through a real estate investor website, and direct mail marketing.
Today, we’re going to focus on direct mail marketing to tax delinquent properties.
Before we dive into how to find tax-delinquent property lists, let’s chat real quick about the basics of direct mail marketing.
The Basics of Direct Mail Marketing
In general, you want to find two or three channels where you source deals, then perfect them.
That advice is nothing new, but it’s also amazingly broad. For example, there are dozens of different types of direct mail options available. So, within this category, it’s best to niche down to a couple.
Here are a few that come to mind:
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High equity owners
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Absentee owners
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Properties with building/health code violations
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Tax delinquent properties (the topic of today)
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Probate properties
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Divorce
You get the idea.
Once you’ve chosen your niche, it’s time to build your mailers.
Creating Your Mailer
This is probably the easiest part but also the hardest.
It’s easy, because it doesn’t matter as much as you think. It’s hard because you think it matters more than it does!
It’s best to be professional, polite, put a picture of you on it, and give your contact information.
Be succinct and let the person know what you do.
It’s really that simple.
Sure, you can tweak it over time to see if different versions of a letter get a better response rate. But, the key for now is to just send something!
Consistency is Key
The biggest problem new investors face is lack of consistency.
Many people will send out a big blast, get disappointing with a 1% or 2% response rate (which is good actually), and stop mailing. But, the best deals won’t come until you’ve built up some kind of rapport with the potential seller.
That’s why you need to mail them over and over again, so your name becomes synonymous with a quick sell!
So, send a follow up letter or postcard, and don’t forget to reference the first letter. Tell them “I sent you a postcard about a month ago and I’m still looking to buy. I’d love to look at yours so give me a call.”
If you get no response, mail them again!
Commit to sending between 5 and 7 mailers to each address over 1 year. That is roughly one every other month.
How to Find Tax-Delinquent Properties
Most cities or counties will have a tax sale from time to time. Some do it monthly, quarterly, bi-annually, or even annually. The key is to learn how your city/county works with their tax sales, and adjust your strategy accordingly.
The next step is to get access to the list of tax delinquent properties. In some places it is available publicly from the city or county. In other places you’ll have to mine the information from online records.
In general, though, there are list providers in every state that do the legwork for you to find properties that are delinquent on taxes, and you can just buy the addresses. These can cost anywhere from 20 to 50 cents each in most cases depending on how much information you can get.
Once you have the addresses in hand, it’s time to send them your first letter.
Mailing to Delinquent Tax Lists
Remember, the owner could potentially lose their home to the tax sale, depending on how the state runs it. They should have been getting notices about it too, so they should be aware of the situation.
If someone like you comes in and gives them the opportunity to earn a little money rather than just lose their house, they’ll probably give you a call.
Letters should be straight forward and to the point. Tell them you are looking to buy and you want to buy now.
Postcards pretty much always get read, so you should convey a sense of urgency to them. Let them know you only have enough money to buy one property, and you want to close fast.
Humans are hardwired to take action when there is a sense of urgency, so you’ll get more calls if you convey that sense of urgency.
Talking to Delinquent Tax List Property Owners
When a delinquent tax owner calls you, it’s important to ask them about their situation and not their property.
Then, let them talk.
DO NOT INTERRUPT!
You should simply say things like “mmhmm” or “and then?” to keep the conversation going. It’s a sales trick. Most people will talk if there is a pause in a conversation. So, by being quiet you are forcing them to do the talking.
As you’re learning how to talk to tax-delinquent property owners, or any other seller for that matter, silence is key. You want them to tell you the problem and give away what exactly they are looking for. So, just stay quiet and take notes.
Once they’ve given up all their secrets about their motivations, it’s time to ask about the property. Ask them:
These two questions will help you know their motivation level.
If the property is potentially worth $200,000 and they want $185,000, then they probably aren’t that motivated.
On the other hand, if their tax-delinquent property is worth $200,000 but they are willing to take $110,000, you should follow up by asking when you can go take a look.
While it may or may not be a good deal, at least you know the owner is motivated enough to give a big discount. If the price, amount of work, and after repair value all work out, then you might have a deal on your hands!
Following Up Is Important
Most of the time it won’t work out, and that’s ok! Often, the seller just isn’t ready mentally to part with their property.
I remember once I made an offer on a 10 unit property for $500,000. The seller said no way.
4 or 5 months later I found a wholesaler advertising the property for $520,000. You know that wholesaler was taking $20,000+ on a deal of that size, so the seller was getting $500k or less for it.
I thought it was kind of crazy, because I had just offered that amount. The reality is the wholesaler followed up and I didn’t.
The seller wasn’t ready to sell at that price at that point. But, after a few months they were and I wasn’t there to get it.
So, make sure you are the one to follow up!
This article originally appeared on IdealREI. Follow them on Facebook, Instagram and Twitter.
By Sheryl Chapman
As we all know, the economy can be unpredictable at times. Recession is a common phenomenon that can affect the investments in your portfolio.
But don’t worry, there are some sectors that are likely to perform well—even during a recession. Here are five recession-proof investments that you can consider adding to your portfolio.
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1. Consumer staples
Consumer staples are products that are essential to our daily lives, such as food, household goods, and personal care items.
These products are in constant demand, regardless of the economic climate. Companies that produce these items, such as Procter & Gamble and Coca-Cola, are considered recession-proof investments.
These companies have a stable revenue stream that can weather economic downturns.
2. Utilities
Utilities are another recession-resistant investment. People need electricity, gas, and water, regardless of the state of the economy.
Utility companies, such as Duke Energy and American Electric Power, have a steady stream of revenue and provide investors with a reliable source of income.
3. Healthcare
The healthcare industry is recession-proof because it provides essential services that people cannot do without. Companies that provide healthcare services or products, such as Johnson & Johnson and UnitedHealth Group, are likely to remain profitable during a recession.
4. Gold
Gold is a safe-haven investment that many investors turn to during times of economic uncertainty. Gold prices tend to rise during recessions because it is seen as a store of value. Investors can buy physical gold, gold ETFs, or invest in gold mining stocks.
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5. Treasury bonds
Treasury bonds are considered to be one of the safest investments during a recession.
These bonds are issued by the US government and are backed by the full faith and credit of the government. Treasury bonds provide a fixed income and are considered to be a low-risk investment.
In conclusion, these five investments are considered to be recession-proof because they provide essential products or services that people cannot do without.
Adding these investments to your portfolio can provide stability during times of economic uncertainty.
Airbnb has revolutionized the travel industry by providing an affordable and unique way for travelers to experience different destinations.
With over 7 million listings worldwide, it’s safe to say that Airbnb has become one of the most popular ways for travelers to find lodging.
However, as a host, one of the most challenging decisions you’ll face is determining the right price for your listing.
Pricing your Airbnb listing correctly is critical to your success as a host, as it can make or break your profitability.
Here are some tips to help you price your Airbnb listing for maximum profit:
Know Your Market
Before you set your price, it’s essential to research the market in your area. Look at other listings in your neighborhood, paying attention to the size of the property, amenities, and location. Check the availability of your competitors and the average price they charge. This information will help you determine your pricing strategy and ensure that your listing is competitive.
Consider Seasonal Demand
Seasonal demand plays a significant role in the pricing of your Airbnb listing. During peak seasons, such as holidays, festivals, and major events, you can charge higher rates. Conversely, during low seasons, you’ll need to lower your prices to attract guests. Keep track of events happening in your area and adjust your prices accordingly.
Offer Discounts
Offering discounts is an effective way to attract guests and increase your occupancy rate. Consider offering discounts for extended stays, early bookings, or last-minute reservations. You can also offer discounts to guests who leave a positive review or refer new guests to your listing.
Calculate Your Costs
To ensure that your pricing strategy is profitable, you need to calculate your costs. Take into account expenses such as cleaning fees, utilities, maintenance, and taxes. Factor in your time and effort as well. Your goal is to set a price that will cover all your costs while still allowing you to make a profit.
Be Flexible
Finally, be flexible with your pricing strategy. Test different prices and see how they affect your occupancy rate and profitability. Monitor your competition regularly and adjust your prices accordingly. Remember that the market is constantly changing, and your pricing strategy needs to adapt to stay competitive.
In conclusion, pricing your Airbnb listing for maximum profit is a crucial aspect of your success as a host. By researching your market, considering seasonal demand, offering discounts, calculating your costs, and being flexible, you can set the right price for your listing and maximize your profitability.
Happy hosting!
Are you looking for a way to earn some extra cash? Have you considered turning your spare room into a money-making Airbnb business?
With just a few simple steps, you can create a cozy and welcoming space that guests will love. In this article, we’ll explore three ways to get started on your journey to becoming an Airbnb host.
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1. Prepare Your Space: Before you start accepting guests, you need to make sure your space is guest-ready. This means cleaning thoroughly, providing fresh linens and towels, and decluttering the space.
PRO TIP: You may also want to consider adding personal touches like fresh flowers or a welcome basket to make guests feel at home.
Here’s a growth hack from the Airbnb lecture inside the academy: “A nice personal touch like a letter or a note can go a LONG way.”
Oh, by the way…he makes $500K/month from his Airbnb side hustle. (Watch it for free here.)
2. Create Your Listing: Once your space is ready, it’s time to create your Airbnb listing. (Here’s a guide on how to do this in 10 minutes. AND it pays you $25.)
This is where you’ll showcase your space and attract potential guests. Make sure to include high-quality photos, a detailed description of your space and amenities, and accurate pricing information.
You may also want to consider offering discounts for longer stays or adding extra perks like free breakfast or use of a pool.
3. Manage Your Guests: Once your listing is live, you’ll start receiving inquiries and bookings. It’s important to communicate promptly and clearly with guests to ensure a positive experience for everyone.
Make sure to answer any questions they may have and provide detailed check-in instructions.
During their stay, make sure to be available to address any issues that may arise and provide recommendations for local attractions and restaurants.
With these steps, you can turn your spare room into a profitable Airbnb listing and start earning extra income. Happy hosting!
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