I am finding some properties on Redfin that are right within my budget, but they’re already on the market obviously. Properties in growing areas by lakes, 5-10k a piece. Is this a bad idea to buy something that is already on the market? Any cons on doing this, besides the fact that my profit margin might not be as significant if I went the list and mailer route? I also am not sure how much I could ideally get for these properties in a few months, if they are already on the market, wouldn’t that be their market value?
I love your blog and read it almost every day!! So much great content. Thank you
Hey @stephr! Thanks for checking out the blog, I’m glad you’re liking it!
As for your question, there’s no rule saying you can’t make an offer (for whatever number suits you) to a person who has their property on the market. You never know their situation or how desperate they are to sell.
I’ve gotten some good deals on listed properties over the years, but when I look at the big picture, statistically speaking, it seems I’m usually going to have better luck with properties that are off-market (provided I know how to target the right people, properties and situations).
Also, I don’t believe Redfin will show you the days on market, but Zillow does. That might be another way to gauge which sellers will be more motivated to sell.
Thank you so much for your response! That all makes sense. You think though since these properties are already on the market, I might potentially have to hold the property a bit longer in order to make a significant profit (rather than I would have to with something I bought through a direct mail campaign) bc of the price already being higher due to it being sold at market value or close to?
The benefit of finding off market properties is that you find motivated sellers that will sell you their property at a fraction of what you might see on the market already right?
Do you have tutorials or templates for good mailers?
Last question… I hear talks of a recession coming. From your perspective, do you foresee a recession making buying and selling land more difficult, perhaps more on the selling side, as people might want to be more cautious on how they’re spending their capital?
@stephr maybe. Maybe not. We don’t know why they’ve been stuck on the market for so long. It could be because they’re overpriced, but it could also be from lack of exposure (if they’re only posting it to one site and nowhere else), lack of a buyers network, low-quality images, and lack of information in the listing, and the list goes on.
Most people (even licensed agents) are pretty clueless about how to market and sell land, and this can really work to our benefit, in giving us opportunities to buy at low prices from people who don’t know how to effectively market vacant lots. I wouldn’t draw too many conclusions from one person being unable to sell their property.
And yep, I’ve got a few tutorials on mailers (not saying mine are the best ever, but if you have no idea where to start, you may find them helpful):
If a recession hits, I would anticipate it will bring things back to equilibrium, where land is easier to buy and a little slower to sell (this is the ways it’s been up until recently, when property values have gone nuts). As long as you stick to the fundamentals and adjust your offers downward based on falling property values (assuming they fall), you should be fine.
This is the way it was when I got started in 2009, when the demand for land was extremely low. I was still able to make it work pretty well, I just had to make offers that were respectively low.
