When most people think about vacant houses, they picture run-down properties or even haunted houses. When I think about vacant houses, I think about big money.
The most profitable houses on the planet are vacant houses. On more than one occasion, I have closed deals on vacant houses that resulted in profits of over $100,000.
When people hear about the profits that can be made off vacant houses, they ask how I even find vacant houses. They don’t have time to drive around neighborhoods looking for overgrown lawns and stacks of newspapers on the porch. The good news is that I don’t have to hunt for vacant houses, and neither do you. With the right strategy, these deals will come to you. My favorite strategy for finding vacant houses starts by befriending your postal carrier.
Neither Snow nor Rain nor Heat nor Gloom of Night:
I am a huge fan of talking to postal carriers about being a bird dog. In my experience, postal carriers are some of the best sources for finding vacant houses. They’re already driving through different neighborhoods every day. Even better, you don’t have to train them to recognize what a vacant house is—they know.
Once your postal carrier provides you with a list of addresses, all you need to do is skip trace the owners. Once you have the owner’s name, phone number, address, or whatever you need to contact them, call them, send them a yellow letter, or take whatever the next necessary step is for you to get in touch with the owner.
The best part of having postal carriers as bird dogs is that you don’t pay a single penny in marketing. That’s free leads! You only need to do one deal from a postal carrier’s leads, pay them a referral fee, and they’re your bird dog for life. Just pay them out on one deal, and they’ll bring more deals to you forever.
What Happened on Chatham Street:
While I maintain that postal carriers acting as bird dogs are the easiest way to find vacant houses, they’re not the only effective strategy in your toolbox. I’ve had some pretty good success with a Facebook ad I’m currently running.
Just a few weeks ago, I had a great lead come in from a Facebook ad. A seller on Chatham Street wanted $95,000 for his house, and the house was free and clear of any mortgages or liens. I sent my contractor and real estate agent to the property, and they determined the after-repair value of the house was $235,000. Considering that the rehab would cost around $35,000, I was eager to make a deal.
I wanted to buy the property with seller financing and gave the seller multiple offers. He refused every time, saying he wanted to be done with the house. I needed to give him all the cash or he would put $15,000 in it and list it with a real estate agent himself.
When I heard this, I instructed my acquisitionist to go back to him and say, “You drive a hard bargain, but you’ve talked Jay into the deal.”
It’s deals like this that remind me how important it is to have private money available at all times so you don’t miss out on any deals where the seller refuses to sell to you on terms and requires all cash.
Don’t Let Ghosts Scare You Away from a Deal:
When you’re going after vacant houses, you have to have the money already lined up to take advantage of the deal. I was able to pay the seller for the Chatham Street house all cash with private money. If I didn’t have private money, I would have missed out on a deal that got me $105,000 in profit.
Vacant houses are an opportunity that most casual real estate investors ignore. But if you’re serious about being successful in the real estate industry, then educate yourself on finding vacant houses. Talk to your postal carrier about being a bird dog. These properties are literally sitting there waiting for you to come along and make a deal.
–Jay Conner
