Searching for homes to present to buyers these days can feel a bit like sifting through a pile of rubble in search of a diamond: It’s tedious, and chances of success feel slim. But, inventory can be found anywhere — agents just have to get creative and put a little legwork into unearthing it.
It may seem hard to set aside the time to use these tactics during such a crazy market, but the effort will pay off for the hardworking agent in the long run.
Off-market properties: FSBOs, abandoned properties, pre-foreclosure, pre-divorce
Some of the best properties just need to be uncovered by the guiding hand of a Realtor. Get outside of the multiple listing service (MLS) and look for properties on for sale by owner (FSBO) websites like Houzeo, FSBO.com, Forsalebyowner.com, and 4salebyowner.com. If you see listings that have been on the market for a while, owners might just be ready to make the switch to a Realtor with the right sales pitch.
It’s also worth it to develop relationships with your local attorneys and banks to gain insight into property owners who may be going through a divorce or are on the verge of being foreclosed upon, real estate consultant Sean Moudry suggested in a post written for The Close. For these individuals, getting the name of a reliable Realtor during a time of upheaval could be a godsend, and will give them the dignity of being able to decide how to leave their home.
In addition, keep an eye on properties in your market that look abandoned and track down the owners of those properties through county records or by ordering an Owner and Encumbrances (O&E) from a title company. It may sound strange, but it is possible for some people to forget they own a property, and it may be a burden for others that they’d be happy to put on the market instead of continuing to care for it.
“There’s some great for sale by owner websites, Facebook has some great websites, The PLS [The Property Listing Service] is one, [a] pocket listing database that has access to stuff,” Anthony Marguleas, founder of Amalfi Estates, told Inman. “So just by hunting and going through and doing research for a lot of those off-market properties … it’s about being proactive and having a proactive mentality. And it makes [the effort] really beneficial.”
Badly marketed properties, expired listings, rentals
Even digging within the MLS itself can be helpful, but agents need to know what they’re looking for.
Marketing is a huge part of any agent’s business, but that doesn’t mean that every agent is equally good at making listings photo-ready in time for when the photographer arrives. And, if a seller is still occupying the home when it comes time to take photos for the MLS, staging can get complicated. Therefore, it’s important to encourage yourself as an agent and your buyers to not immediately dismiss poorly marketed properties — a home hidden beneath a seller’s clutter could end up being your buyer’s diamond in the rough.
Agents should also not be afraid to take a swing at contacting listing agents on rental properties if their client is interested in selling. With the right offer and argument, some property owners will be happy to take an offer to sell.
Similarly with expired or withdrawn listings, agents shouldn’t shy away from contacting the listing agent to see what happened, and if they have any interest in passing the listing along. If you offer them a referral fee, there’s no reason to feel guilty either.
“What a lot of agents do is, they make the mistake of trying to go after the seller, and what happens with that is, they’re going blind,” Marguleas said. “They’re calling a seller who maybe their listing expired or is withdrawn. If you go to the previous agent who had the listing, say, ‘I’m happy to pay you a referral fee,’ then that previous agent has a vested interest and they’re going to tell you all about the seller. They’re going to tell you what their motivation is or why they wanted to sell, all this information. So it’s really, really helpful.”
Todd Tramonte of the Todd Tramonte Home Selling Team told Inman in April that about 20 percent of his agents’ listings have been found with these methods, which is really helping bring them success in this market.
“When we’re able to find off-market inventory, really badly marketed inventory, homes that are in some sort of transition, canceled, withdrawn, temporarily off-market, mislabeled properties, reluctant landlords who are advertising a property for lease but if they really knew what they could get for a home, they would be wise to sell …” Tramonte said. “We’re finding, it used to be 3 or 4 or 5 percent and I think we’re up to probably 20-25 percent, where I think a great buyer agent is finding those properties for their buyers, not just searching the MLS for them.”
There’s been so much press in national and local news recently about this unprecedentedly hot market that a handful of your past clients may already be considering selling without your knowledge. It may be that they just need an extra nudge or a little bit of encouragement. So, now is the time to reach out to them and wow them with all the facts you know about the current market — and what place their home in particular has in it.
Marguleas said that he likes to think about contacting past clients as ‘matchmaking,’ thinking about his current buyers’ needs and brainstorming what sales he’s done in the past few years to match a previous property he’s worked with to satisfy his new clients’ requirements.
“If you look at it like matchmaking, like, ‘oh I want that perfect buyer to find this perfect property,’ and you start thinking about it, ‘Oh wait a minute, I sold a house two years ago that was three bedrooms, and it had a view, and I have a client looking for a view property. I’m going to go call my past client up and see if they’re interested in selling.’ So you’re a matchmaker. You [can] really make it fun.”
Networking and pocket listings
Brokerages and teams that take the time to curate a database of pocket listings, or ‘coming soon’ properties over years — while following the Clear Cooperation policy guidelines — will also benefit greatly from this effort in the long run. To be in compliance with the Clear Cooperation policy, brokers cannot market properties publicly outside of their own staff or client sphere. Otherwise, they have to submit the listing to the MLS within one business day of marketing the property. Some agents and brokers are even currently benefiting from such databases while many other agents struggle to find inventory.
Marguleas, for instance, has developed a robust ‘coming soon’ status database within his brokerage over the course of about 20 years, made up of potential clients who are at various stages in the homeselling process. Some of those future sellers are maybe at a point where they’d be willing to sell if an offer for X amount of dollars came in. Others may be working more from a timeline standpoint, where they know they’ll want to sell in about one to two years.
“The average agent has one or two off-markets, and we’ve created 600 in our database,” Marguleas said. “So, for example, there’s currently 80 homes for sale in the exact city that our office is located in Pacific Palisades, but yet we have 120 properties that we know about that are off-market. And these are in various stages.”
Joining networking groups and continuing to keep up your relationships within the industry can also be a huge asset in turning up new listings. Staying close to fellow Realtors helps you to potentially stay close to their clients and their properties, which helps everyone win when it comes to the transaction. If your client is looking for a home in a particular area, start networking with top-producing agents in that market and let them know you’ve got a qualified buyer who’s ready once a seller is ready to list.
For the agent or brokerage that’s already getting great returns on their social media and marketing tactics, creating and pushing out advertisements for their buyers that are searching for a new home may also prove very fruitful.
Create a kind of ‘home wanted’ ad that describes what kind of property your buyer is looking for with details like number of rooms, price, neighborhood, and other key necessities. Then, talk your buyer’s qualifications up and post the ad on social media or create print ads to put in local publications or mail out in postcards to former clients.
“That’s been a great way to find properties before they come on the market,” Marguleas told Inman. “So we’ve been really, really beneficial with that.”
Every agent knows about farming, but it’s important to pay attention to the details in order to have a chance at success with this strategy.
Create very targeted, detailed letters and emails to homeowners that explain why their property would do well on the market. If you have a specific buyer in mind for the property too, explain how their home fits your buyer’s needs perfectly.
“What we do, is we have certain letters that we have made up and they have to be really personalized,” Marguleas said. “The more data on the buyer, the better, to make it more real … once again, it’s about being proactive.”
When it comes to making the time to find new inventory in these ways, Marguleas added that agents don’t have time to spare.
“You’re too busy not to,” Marguleas said. “It’s working smarter. If you have 20 buyers and there’s no inventory, your goal is you have to find that inventory. So I think it’s a huge component of a lot of agents’ business that they’re missing out on.”