The current state of affairs related to the Corona virus pandemic continues to affect millions of homeowners and businesses.
Very few people have been left unaffected by this pandemic, with many who had plans to sell their properties from before the virus spread, but can no longer do so.
While the government is helping those in need who are having trouble making their mortgage payments, and preventing foreclosures, there’s now a lot of other people who don’t need government assistance, but still need your help.
They were motivated to sell their properties before the virus, and now because of it, they are more than ever looking for your help, and a fast cash offer on their properties.
We need to adapt to how the virus has changed the way that we transact business as real estate investors, especially in the types of motivated sellers that we approach, and the way that we find and reach out to those sellers.
In this post I will cover:
- The 4 types of motivated sellers that want your help in this market.
- What are the best list providers to purchase these motivated seller leads from?
- What is the best way for real estate investors to get in front of these motivated sellers in this time of social distancing?
First, below I describe each type of motivated seller so that you have a better idea of the current landscape.
4 types of motivated sellers to help in the current market
An absentee seller owns a property, but they do not live in it. Absentee owners typically do not have an emotional attachment to a property because it is purely an investment for them.
In most cases, absentee owners are investors who hire property management companies to lease out their property and take care of maintenance.
The property management industry has gained a bad reputation for mismanagement, and absentee owners who rely on the management for a property in another county or state are particularly vulnerable to this.
If an absentee owner is having trouble with a property or a management company, they are likely already motivated to get rid of the property.
Absentee owners now have an additional motivating factor that has increased due to the pandemic, which is the potential of not getting rent payments. These sellers are very likely to want to talk about their options to walk away from the property.
These leads refer to empty properties that no one is occupying. Owners of vacant properties can be motivated for several reasons.
An owner might be an investor who has had trouble renting the property or finding a reliable property management company.
An owner could be a single person or couple who had to move out of state for a new job before they were able to sell their home.
Regardless of the reason for vacancy, owners don’t want their property sitting empty.
Investors aren’t making money and others don’t enjoy making mortgage payments and property taxes on a home they aren’t living in.
These properties were previously selling at a discount, and right now, their owners are not interested in holding them for any longer than they have to.
High Equity Owners, Free and Clear Properties
Sellers with high equity have paid off most or all of the mortgage(s) they had on their house.
In other cases, a person might have a free and clear house because they inherited it from one or both parents.
When you talk with a high equity seller, they will have more negotiating room on the price, because they don’t have to worry about the balance of a mortgage.
With high equity, a homeowner can sell for below market value and still walk away from the table with more cash than they expected.
Whether a house is newly constructed or was built a century ago, it has to comply with municipal and state codes concerning materials, improvements, occupancy, use, and much more.
If homeowners violate code and their local or state government decides to enforce penalties, they can lose their home in addition to facing fines, and sometimes criminal charges depending on the violation.
Owners who have violated one or more codes likely have many issues going on behind the scenes, such as being absentee or vacant owners, motivating them to sell so they don’t have to maintain the property.
Now that you have an understanding of the different types of motivated sellers that need assistance, let me break down the best places where you can find them.
Best list providers where you can purchase motivated seller leads from
(These are not sponsored in any way)
Best List Providers for Absentee Owners
Not all list providers offer lists for absentee owners, or you have to go through several steps to sort information. ListSource uses CoreLogic data to provide a variety of quick lead lists, including one for absentee owners.
If you live in Arizona, California, Nevada, Oregon, or Washington, PropertyRadar needs to be your go-to source for absentee owner lists.
Like ListSource, PropertyRadar offers quick lists for real estate investors, but they further divide their absentee owners into two separate lists: one that includes absentee real estate developers and another that includes absentee homeowners who are out of the area.
This allows you to more specifically target two different kinds of absentee owner leads.
Best List Provider for Vacant Properties
You can build your own property owner list at Melissa.com. Unique to many other lead providers, Melissa includes a vacant address selection within the data for absentee owners. Melissa’s Property Owners’ data includes about 95 percent of the U.S. population and 98 percent of all mortgage transactions.
If you are looking for vacant properties, another good bet is DataTree’s Lists.
Many other list providers do not offer specific information about whether a property is vacant or not, forcing you to discern between vacant and occupied properties with absentee owners.
DataTree offers a specific list for vacant properties that comes from First American’s large repository of more than six billion document images.
Best List Provider for High Equity Owners, Free and Clear Properties
ListSource again is a very good contender when looking for high-equity homeowners, especially those who need to downsize.
You can read the exact steps to follow within the ListSource interface to get a list of empty-nesters in this post: find sellers with high equity.
Several companies that sell real estate leads have some type of equity information, but Click2Mail provides the most equity-related data points.
They have a real estate list that includes more than 45 million property owners compiled from county recorder and assessor records. You can build your lead list for high equity or free and clear properties with one or more of the many filters they have, including:
- Estimated Available Equity
- Estimated Available Equity Range
- Estimated Lendable Equity
- Estimated Lendable Equity Range
- Estimated Loan to Value (LTV)
- Estimated Loan to Value Range
- Estimated Mortgage Balance
- Estimated Mortgage Balance Range
- Estimated Remaining Months on Loan
- Estimated Total Loans
- Estimated Total Loans Range
Click2Mail also provides several points of data about any outstanding mortgages on a property.
Another great option to find leads to target high equity sellers is Melissa Direct.
When you visit the site, you can build your own list from their Property Owners’ data and filter your selection to include equity amounts. The filter separates equity by $100,000 increments until you reach one million and draws on the company’s large database, which includes approximately 98 percent of mortgage transactions in the United States.
Melissa guarantees a deliverability rate of around 95 percent.
Best List Provider for Code Enforcement Properties
Real estate code violations can result in fines, criminal penalties, and abatement. Ultimately, if a homeowner does not fix any code violations or pay the fines, the city can put a lien on the home.
You can visit your city’s Code Enforcement office or similar department to get the information, but this takes a lot of time and effort.
DataTree has such a large collection of public documents, including any recorded liens against a specific property, that you can find the code enforcement leads that you want through their lists.
What is the best way for real estate investors get in front of these motivated sellers in the age of social distancing?
It’s becoming clear with each passing day, that the old ways of marketing to motivated seller leads, such as direct mail or door knocking, are just not possible at this time.
People don’t want to touch their mail, and they are certainly not answering the door.
In my area, real estate agents have stopped all showings and open houses, and sellers now have no way to market their property to traditional buyers.
This leaves motivated sellers with no way to get rid of their houses for as long as the Shelter in Place orders are mandated.
If not that, then what?
First, think about what people (including you) are doing right now.
They are working from home, or mandated to shelter in place, and they are scanning the internet and doing searches for what they need.
Google, Bing, and other search engines are where these people are searching for the answer to their problems.
First, make sure you have a lead capture website set up
First and foremost, your leads are looking for you on Google, so a real estate investor website is required to get yourself in front of sellers in your area who could use your help.
If you don’t have a real estate investor website set up yet, then with REI/kit in just two clicks you can create a complete lead capture website, so that sellers can get in touch with you for their cash offer.
Send email outreach
Second, what is all of this isolation making EVERYONE do multiple times a day?
Everyone is checking their email, obsessively.
Most sellers does not know how to find you, search for you, or simply don’t know that your solution exists. This is why you need to reach out to them with cold email outreach.
One of the easiest methods is to get this done is to:
- Purchase a list of potential sellers from one of the motivated seller list providers above.
- Skip trace the homeowner names and addresses to retrieve phone numbers and email addresses. If you need more information on how to do that, read this guide on skip tracing motivated seller leads for real estate investors, using both paid and free methods.
- Upload the skip-traced list to your REI/kit CRM, or let us do it for you.
- Send your list to our automated Cold email outreach sequence, which is a series of 5 professionally written emails, optimized to get a high response rate from people who have never heard of you, and who need to sell their house ASAP.
The pandemic that is unfolding in front of us is presenting the world with new challenges on how to perform business.
It’s easy to feel frozen in place, and unable to take action if you don’t know what to do, but with a little creativity, you can see that we are actually presented with new opportunities to get in front of more, and more motivated, sellers.