Traditional sales make up only a portion of the residential and commercial real estate market each year. Off-market property sales are on the rise and they are more than just great investment opportunities.
Every off-market property represents a potential client. In fact, about 75% of sellers sell their property with the first agent they interview. By accessing off-market properties, you have the first opportunity to present your services to new clients. Here are our top tips for finding and using off-market real estate to grow your business.
What is Off-Market Real Estate?
Also known as quiet listings or pocket listings, off-market properties fall into a number of categories. The owner of the property either wishes to sell quietly, hopes to test the real estate market before listing, or has not considered selling—yet.
There is one thing that off-market properties have in common. They are not listed on the multiple listing services (MLS). This means that if they are for sale, they are not publicly advertised.
What makes off-market properties so unique is that not all of them are actively for sale. In fact, until they are approached by an agent or a buyer, many off-market property owners don’t even realize they want to sell.
Finding these prospective clients is what makes ProspectNow a great tool for real estate agents. The same metrics that are used to analyze why a property sold can also be used to determine if a property is likely to sell. Your future clients currently own off-market real estate. Knowing how to access these properties is key to growing your business.
Who Benefits from Off-Market Properties?
The short answer is everyone. Off-market property sales can benefit buyers and sellers depending on the reason for the sale taking place off-market. They also benefit agents looking for new clients. Here is a variety of ways pocket listings benefit all the different interested parties.
Sellers who want to quietly hand off a property benefit from the privacy of an off-market sale. Property owners experiencing financial difficulties often wish to sell privately in order to quietly get out from under a difficult situation. Off-market selling affords them a level of confidentiality.
In a competitive market, much like today, sellers can use off-market strategies to get higher offers than they might expect in a public sale. Owners generate interest in their property through word of mouth. Because the property is not listed on the MLS or available to the public, buyers and investors are often intrigued and eager to win the sale.
Another way off-market sales benefit the seller is if they wish to sell a rental property without disturbing the current tenants. This is particularly applicable to commercial properties. Commercial property owners often like to test the market or explore their options quietly without disrupting the businesses that occupy their properties.
Buyers & Investors
Buyers can equally benefit from an off-market property sale. When a buyer has access to off-market properties, they have the advantage of being one of only a few prospective buyers. Without the intense competition of the public market, buyers can take their time with negotiations.
Investors often pursue off-market properties to benefit from discounted prices and reduced fees. When a seller hopes to quickly and quietly get out from a property, they are more willing to accept a lower offer.
Without third party involvement, both the seller and investor can save money on fees. In public sales, these fees can add up quickly. Avoiding these extra costs benefits buyers who want to flip the property and get a higher return on their investment.
Often, Investors offer cash to buy off-market real estate. This gives them an edge on buyers who require a loan and the extended timeline that goes along with that. Investors commonly focus on finding off-market owners who would benefit from a cash sale.
Real Estate Agents
Off-market real estate offers a huge advantage to agents. Some off-market sales take place without any agent involvement. Many off-market owners, however, are prospective clients. Whether or not they are currently interested in selling, their commercial or residential property will sell—eventually.
Connecting with these off-market property owners adds to your network of potential customers. With the right tools, you can access the off-market properties that are most likely to sell. That is when the off-market properties are most advantageous to your real estate growth.
Finding Off-Market Properties
What are the right tools to help you access off-market properties? ProspectNow uses predictive analytics to determine which properties—commercial and residential—are most likely to sell or refinance in the near future.
In 2018, approximately 5.34 million homes sold according to public statistics. ProspectNow has detailed property ownership for over 100 million residential properties. This means the MLS and public sales reflect only a small portion of existing properties.
The same trend is true for commercial properties. ProspectNow reflects property info for nearly 40 million commercial real estate properties. Other platforms and listing sites show only a fragment of that number, meaning agents and investors are missing out on an entire platform of off-market properties.
Of the collective 140 million off-market properties in the ProspectNow database, not all will become sales or potential clients. Yet, over 30 million properties in the database are predicted to sell.
According to Statista, home sales in the U.S. are predicted to reach 5.25 and 5.46 million in 2019 and 2020, respectively.
Predictive analytics give agents and investors access to over 30 million potential clients and investments. Instead of only networking with property owners who are ready to list immediately, you have the opportunity to connect with a huge pool of off-market property owners.
Searching Off-Market Through ProspectNow
Previously, finding off-market properties required a combination of networking, real estate connections, direct mail marketing, or access to real estate wholesalers.
While these methods are still useful in some settings, the digital tools on ProspectNow give you immediate access to the most advantageous off-market properties. Instead of posting signs advertising your investment business, you can connect directly with owners who are most likely to sell their properties.
Owner contact info
Every search renders contact info for off-market property owners, including phone numbers, emails, and mailing addresses.
Commercial property owner information is also available. ProspectNow connects investors and agents with managing members of U.S. corporations that own CRE that is predicted to sell.
Owner contact info for over 140 million properties gives you a direct line to owners and managers so you can make a personal connection. Whether you prefer to contact people on the phone, through email, or even using direct mail, a database of key contact information gives you every option for connecting with potential clients.
Predictive analytics make off-market property searches increasingly more effective. A study by Deloitte showed how technology is impacting the real estate industry. Without access to essential data, it is getting harder to keep up with competitive real estate trends.
ProspectNow looks at the data points that are significant in properties that have sold and uses those same metrics to help determine if a property is likely to sell. This approach to off-market properties helps agents and investors connect with the right property owners.
Predictive analytics ensures agents are focusing on relevant leads and not wasting time or resources on unproductive ones.
The ProspectNow platform is the only database that uses predictive analytics for commercial real estate properties as well as residential. CRE investors and agents can save an enormous amount of time and energy by concentrating on the commercial properties that are more likely to sell in the near future.
Once you have access to the most advantageous off-market properties, the next step is deciding how to connect with interested owners.
Previous methods of advertising focus on a large segment of properties based on location or incomplete data. ProspectNow takes off-market property searches a step further. After you identify your key property owners, the platform uses IP targeting to help you display digital ads to your target audience.
This approach to digital marketing helps agents and investors fine-tune their off-market property search, making it easier to connect with property owners who are likely ready to sell.
The direct mail approach has been around for a long time, but it is far from dead. While we have new techniques and digital marketing tools that are becoming increasingly more effective, direct mail is still a go-to marketing tool.
According to a 2018 ANA/DMA response rate report, direct mail response rates are still higher than digital marketing, including email and social media. As digital tools and analytics improve, this trend may start to change. For now, however, direct mail should still be part of your marketing repertoire.
What does this mean for off-market property potential? In the same way ProspectNow targets key off-market property owners through digital marketing, the platform also offers direct mail tools.
Now that you’ve identified which off-market properties in your area are most likely to sell, you can use the platform to mail postcards and marketing material directly to those clients.
The Advantages of Off-Market Listings
Off-market properties represent the majority of properties in the United States. This means those properties also represent an abundance of untapped real estate potential. ProspectNow’s tools help you not only find off-market property owners but also identify the most advantageous opportunities and reach out to those potential clients.
Off-market real estate is increasingly accessible through predictive analytics and searchable databases. Grow your real estate business and tap into millions of real estate opportunities and connections through ProspectNow.