Learn How to find great investment deals when driving for dollars
In the last post we discussed the importance of researching your market before driving. This is very important because if you don’t know where you are going, you will never get there.
So, let’s assume you have mapped out the subdivisions you will be driving. You have your Zillow app, note pad, and, hopefully, somebody with you driving, while you are taking notes
You can drive for dollars by yourself but you need to be extra careful. You can get easily distracted. While you are looking at houses you could hit the trash can or a car on the street.
It must be stressed that it is of the upmost importance to have a wing-man, so to speak. If someone else is in the car with you all you have to focus on is driving.
It may seem an unnecessary overture or that you are being too cautious but there is really no such things as too much caution. You want to make this as smooth and efficient as possible.
The only way to do that is to make sure that you have what you need and can focus on simply driving to where you need to be. The other person can be your eyes and director to finding the place.
If for some reason, you are unable to find someone to accompany you, then properly prepare before hand. Make sure you know exactly where you’re going. Make sure you’ve mapped out the streets and have a good idea as to where the house or houses you are looking for are located. This will cut down on your distraction and will enable you to be that much safer and cautious as you are driving for dollars.
Once you start driving around your target area, you will find ‘For Sale By Owner’ or ‘For Rent By Owner’ signs. Be sure to write down those numbers and call them. Put on the charm and offer your services. Tell them you are a home buyer.
If their house is for rent, no problem. Tell them “Hey Mr. or Ms. Seller, I drove by your house you are renting at 123 Main St. I know it is for rent but I was just wondering if you would be interested in selling it. It is not guaranteed but you may get a deal this way. Don’t drive by those signs without calling them.
Find Vacant and Distressed Properties When Driving For Dollars
When you are driving for dollars you should try to divide the houses you see into Distressed Homes and Vacant Properties. Not only will this give you a bit of organization it will, also, give you a quicker pile of homes that are more likely to be sold. So, when you are working on your marketing letters, you should pay close attention to the vacant ones. If property is vacant, more than likely, the owner is motivated to sell. So, be sure to put these properties in your priority list.
There are some easy and simple ways to find distressed and vacant properties while driving for dollars. These are some of the most common things you can use to determine if a property will make it to your driving for dollars list.
Whatever properties you see that appears to be rundown or beat-up are, usually, your best bets. Take note of houses with signs of general disrepair. If it is in poor shape and seems to lack basic maintenance or even if it appears to have some maintenance but there are still signs of rot or low upkeep. These are obvious leads you need to write down.
City Notifications
As you are driving for dollars you may come across homes with yellow or red papers on the main door or windows of the house. This, simply, means the city found an issue with the property and place a notification. In some cases, the city will place a yellow yard sign in front of the house or staple a sign to a tree.
Overgrown Grass – Lack Of Landscaping
One of the more obvious signs of disrepair is overgrown grass. If you see tall grass and vegetation that is not being taken care of this is a good lead. If it seems the yard has not been mowed for weeks or even months this should tell you that the property is either vacant or neglected.
Junk In The Yard
We’ve all come across houses that seems to resemble a mini trash dump. Sometimes it doesn’t need to be that exaggerated but evidence of papers strewn around can be damning. Seeing piled up newspaper in front of the house or old mail in the mail box shows that no one is checking in or has been there for some time. These shows the house may be vacant or the person living there does not care about the house.
Boarded-Up
Be on the look out for houses that appear to be boarded up. Be careful in noticing boarded up windows, broken windows, or windows with plastic or tarp. Also search for tarp over the roof that seems to have been there for months.
Some houses will have tarps of multiple colors. This is a sign the owner is not taking care of the property and the interior may be in bad shape too.
Abandoned Cars
Easily, one of the most noticeable signs of vacancy or neglect are abandoned cars. Most of the time if there are broken down cars parked in the driveway and it appears to have been that way for months or even years; the inside of the house may look the same. This is, usually, a quick guarantee of abandonment and neglect.
Ruined Door
Check to see if the front door looks beat up or may be barely hanging on its hinges. Usually, if someone is living in a home they don’t enter in and out of a house with a rotted or destroyed door. It’s easy to discern that this may be more than neglect and just signifies abandonment. If people don’t take care of something so simple, just imagine how the rest of the house can look.
Peeling Paint
Some houses may be made of stone or brickwork and it doesn’t apply. Most homes, though, have material that’s painted. If paint on the house is peeling and you start seeing some rotten siding or rotten window frames odds are it’s vacant or is liable to be sold.
Rotten Fences
Take a good look at the perimeter of the house and see if there is a fence. Check if the fence is rotten or falling down with green moss all over it. Just image if you are looking at a fence that can be feature in an Indiana Jones or Jumanji movie.
There are other sings that are not so obvious while driving for dollars.
Old Metal TV Antennas
Remember old metal TV antennas on the roof? Remember these times? When we had to hold the antenna so the image on the tv can look better? If someone has not removed the antenna, it means the house needs to be updated. These things have probably been sitting for years.
Old Cars
Take notice of what type of cars may be parked in the driveway. Take notice of the make and year. More often that not, people who tend to have older cars have, usually, been living off of the property for many years. A good example of an older car would be a ’78 Buick.
Roller Ramps
Houses tend to have steps but a few have roller ramps that were installed. An old house with roller ramps in the front door and grab bars, are, usually, signs that older people are living at the house. This should give you hope that at some point they may sell the property.
These are some great signs you can use to compile your list.
It is also good to start noticing small multifamily properties with deferred maintenance. Sometimes, you should ask the tenants if they have the owner or property manager information. This way you can call them later to see if they are interested in selling the property.
Usually, if you are driving for dollars for 3 hrs, you will have about 20 to 30 properties. Also, if you drive for around 3 hours you may need a nap afterwards
Now is the time to get to work when you get home. Start researching the addresses you wrote down and create a database in excel. Go to your county website and pull the homeowner data. Is this an owner occupied home or absentee owner?
Once you complete the list, mail every single property every 30 to 60 days and continue building your list over time. Send them a mix of yellow letters and type letters. These will get the best response rates.
Then, keep track of the people that called you and write notes. When I started I used excel to create notes of my leads, then as deal flow increased I move to Podio. Sometimes, when you send the letters you will get letters back that say in large handwritten letters UTF. It means unable to find. This means the postal service cannot located the owner.
This lead could be a gold mine. This is where skip tracing is very effective to find these lead. When you skip trace you can find the owners new address or phone numbers. Also, you can find the owners relatives. Then you can mail them, text them, or knock on doors.
I have met people where that’s all they do and make $30K to $50K per deal. That’s not bad. If you follow these easy steps, you will be 100% prepared for a successful driving for dollars adventure.
Before I go Benjamin Franklin once said “An Investment in knowledge pays the best interest.”
Until next time, good-bye and happy investing.
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