One of the most challenging aspects of real estate investment is actually locating properties, particularly if you are searching for properties in need of renovation. While MLS listings and foreclosures offer great opportunities for purchasing below-market fix-and-flip properties, finding deals with a high return on investment (ROI) often requires active searching.
Real estate investors often refer to this practice as "driving for dollars," which involves visiting specific neighborhoods with the goal of finding distressed or abandoned properties. This technique is used by real estate investors, wholesalers, and bird dogs alike, and it is particularly valuable in today's competitive real estate market, where listed properties receive multiple offers and are under contract within hours.
Driving for dollars allows you to discover distressed properties that are not on the market, giving you the opportunity to make the initial (and potentially the only) offer.
What Does "Driving for Dollars" Mean?
"Driving for dollars" is a term commonly used in the real estate industry, specifically in real estate investment, to describe a strategy for identifying potential investment properties.
This approach involves physically driving around neighborhoods, actively searching for off-market properties that exhibit signs of distress, vacancy, or the need for repairs. The objective is to find undervalued or distressed properties that can be purchased below market value and subsequently sold for a profit, either after renovating them or selling them as-is to another real estate investor.
Driving for dollars is an integral part of wholesaling strategy, as it assists real estate investors in identifying potential leads that could result in profitable deals.
To learn more about real estate investing, book a strategy call and see how you can buy discounted real estate in your backyard.