When people think about undervalued or overlooked assets, they typically call to mind things like life insurance policies that an older relative forgot they signed up for or treasury bonds that slipped through the cracks when putting their affairs in order. You don’t necessarily think about undervalued or overlooked real estate assets – yet that’s something far more common than people realize.
Any seasoned real estate professional can tell you that sometimes finding the rightful owner of a piece of property is a lot easier said than done. It doesn’t even need to be something that is passed down through the generations. It can happen for a myriad of different reasons. But if you’re a wholesale real estate professional trying to capitalize on an opportunity before anyone else can, how that property ownership became so muddy is less your concern. You need to figure out who owns an asset to make an offer – fast.
Thankfully, there are several strategies and techniques that you can use to identify and recover undervalued or overlooked real estate assets. You just need to make sure that you’re applying them in the right way for the objective you’re trying to accomplish.
The Combination of Public Records and Advanced Analytics
When people think about public records in a real estate context, they usually think about things like property records, tax assessments, and even court records. These types of documents are readily available for you to use and can give insight into the ownership history of a property, any recent transactions that it has been a part of, any legal proceedings that may be impacting it, and more.
But it’s important to look at these types of records for what they truly are: a good start. There’s still more of the story to be told, and other publicly available records can help you pull back that proverbial curtain.
Once you’ve uncovered the owner or a likely candidate for being a property’s owner, credit reports and other financial data can provide more invaluable insight. This can help indicate someone’s current financial situation, any previous addresses they may have been associated with, and more.
Utility records can help uncover recent address changes you may have been unaware of.
Even data from the United States Postal Service can help you learn more about forwarding addresses, mailing returns, and more that could be insightful if you’re trying to locate a particular person.
Based on this image you’ve slowly put together about who someone is and their history, you can uncover opportunities to reach out and accomplish your goals. If someone’s financial situation lets you know that they need money, they may be more open to discussing an offer on their property (or at least, will be willing to work with you on the price) in a way that might not be possible had you not done that research.
That’s just one example of a hidden opportunity you can uncover regarding the owners themselves. In real estate, figuring out the owner of a property is a big part of skip tracing. Using advanced analytics and tools powered by machine learning can help you quickly make sense of the massive amount of data you’ve collected, gaining these insights faster than you could on your own.
The Importance of Thorough Research and Data Analysis
But what if you’re not far enough along on this journey that you are looking for the owner of a property at all? What if you’re simply trying to find a property to help meet your goals in the first place? Thorough research and data analysis can still play an invaluable role, albeit from a slightly different perspective.
Again, never underestimate how much critical information is contained within public records. These days, it’s possible for even novice investors to use predictive analytics to highlight emerging markets. There may be an area not far from you that is poised to become the “next big thing” in the real estate market that nobody else seems to recognize yet. Is it a sure bet that this future will come to pass? Of course not – nothing in this life is 100% certain. But with the right data sources and predictive analytics, you can at least increase your confidence.
You can even use thorough research and data analysis to conduct a risk assessment to help narrow down a large list of prospective properties to a few. You can try to use the last 10 years of a property’s history to predict what the next 10 might look like. Based on that impression, you can then decide if that is a path you want to embark on or if you should keep looking for something that falls a little more in line with what you’re trying to accomplish.
To increase the accuracy of any predictions, contrast the story of the property’s history with the story of the owner (assuming you have that information). This can be a great way to identify a great investment opportunity paired with the information you need to strike the best deal possible with the owner. Even with all these tools at your disposal, success is not a 100% guarantee. It is, however, a lot easier to achieve than it would have been even as recently as a decade ago.
Whether you’re a traditional real estate professional, an investor, a recovery specialist, or someone else entirely, these are the types of best practices you can use to maximize asset value and uncover potential investments along the way. The most obvious application is dealing with distressed properties. There may be a home in a prime spot in your neighborhood that looks like it’s been abandoned. Someone owns it, however – even if they don’t necessarily realize it. Finding them and making that offer requires you to arm yourself with the most actionable information that you can.
Over time, you’ll be able to enhance your investment portfolio in a substantial way. You’ll also be able to use tools like those outlined above for successful asset recovery in the real estate market on a daily basis, which in and of itself is what it’s all about.
