7 Ways To Find A Potential Rehab Property
When rehabbing properties there are plenty of ways to find discounted properties. This
is an integral part of being able to flip homes for a profit. I have been in real estate for a
number of years and generally speaking, the higher the discount, the better profit you
stand to make on the back end. Although there certainly are other ways to find
discounted properties, below is a list of 7 ways to find discounted properties for your
next investment property.
1. Board Up Services
Whenever a home is foreclosed upon, a lot of times the bank or city will pay a company
to cover the windows and any entry ways into the house. Generally, this is done to stop
any vandals or thieves from breaking into the property and causing any type of damage.
Each house that you see boarded up by these services should have contact information
somewhere on them. I recommend contacting the company that is listed and seeing if
they are taking offers on the property.
In addition to this, its a good idea to inquire about other properties in the area that they
may have boarded up so that you can go check them out and potentially buy them at a
discount. While not all of these properties will be of interest to you, it’s important to note
that this is a great way to find distressed homes for sale. And hey, if you find 10 houses
like this and buy only one, the profit on the one that you bought would make it worth the
time and energy. Personally I have bought several investment properties like this, and
make quite a bit of money off of them all
2. REO or Bank Owned
REO or bank owned properties are usually owned by the bank because of foreclosure.
A lot of times though, banks will commit to listing these properties with local real estate
brokers, and so you can’t just call the banks and ask for a list of properties that they
have for sale. Usually the best course of action is to contact the broker with which the
property is listed and ask them if they have a complete list of properties for sale that are
This is a fairly simple tactic, but a lot of my investment properties have been bought like
this and it’s a really good way to find potential investment properties at a discount. Over
the years investors have made a lot of money off of properties like this, and it’s a good idea to
contact banks and see if they can provide you with a list of properties, or if they use a
broker, ask them for the brokers information.
3. Drive The Neighborhoods (Driving For Dollars)
Driving for dollars is a pretty old-school approach to finding potentially distressed
properties, but its an effective one. Its a great way to get started by doing just this, and it
helped many investors establish themselves as a successful investors.
Essentially what your doing is driving around different neighborhoods looking for signs
of distressed properties. More specifically, you’re looking for places that may be
boarded up, or falling apart. Another sure sign of a property that is distressed or
abandoned is tall grass and landscaping that hasn’t been kept up with.
If you feel as though you’ve found a property like this, what you’re going to want to do is
send either a letter or a postcard to the owner of the house. The letter or postcard
should state that you’re a real estate investor and that you buy distressed and vacant
homes, and were interested in making an offer on the property.
In most states the information about who owns the building is public record, and in those that its not, there
are several pay sites on the internet who can locate contact information on the owner.
Like I said before, this is a pretty old-school tactic, but it’s very effective for finding
potential rehab properties. I would highly recommend utilizing the driving for dollars
technique, , and can assure you that it works really well.
So wholesalers can actually be a great way to find potential investment properties.
Wholesalers find the deals, so you essentially pay them a fee to go through the closing
process on a property. With wholesalers, they have already done all the leg work for
you and located the deal and placed it under contract.
We have made quite a few deals with wholesalers to locate investment properties for
myself, and it’s probably the easiest, most hassle free way of finding your next potential
You can utilize resources like Facebook and craigslist to find potential properties. With the web, we as investors have access to
many more money making opportunities and this means nothing but potential profit for you. I would suggest if you don’t know anybody personally who wholesales, that it would be a good idea to search companies on the internet and through social media resources to find your next potential deal.
6. Bird Dog Programs
A bird dog is essentially somebody who you pay to bring you new deals. Generally
speaking, a good bird dog is someone who is familiar with the area in which you want to
invest, and someone who spends a lot of time either walking or driving around.
Mailmen, Pizza delivery people, cable installers, and taxi drivers would all make great
bird dogs because they are driving or walking through the neighborhoods everyday and
they see the houses that are distressed and abandoned.
Now you can’t pay for every potential deal they bring you, so the general rule is to only
pay them if their tip actually leads to you buying the property they told you about. Fees
paid to bird dogs range from $250- $1000 per property and are dependent upon what
the market dictates.
However, it’s important to note that in some states it’s illegal to advertise that you will
pay a bird dog to bring you properties, so check within your state and investment market
to check and see what the laws are near you. This is a great way to have deals brought
7. Tax Sales and Auctions
So whenever a property owner doesn’t pay their property taxes the government will
seize the property. If they cant settle up with the owner, they eventually auction off the
property for much less than retail price. This is public information and you can benefit
from a low priced property that could be ideal for your next flip.
Many investors swear by this method as a great way to buy properties at far less than market value,
and its a viable option for you as well.
Real estate is a very profitable business if done right, and the first step is finding
properties at a lower than retail price so that you can make a profit.
I would recommend any of these methods for finding potential investment properties,
and hopefully you can use these to find money making deals too.
Good luck and happy house hunting!