Finding hidden gems in real estate—those undervalued, off-market properties with massive potential—is the key to successfully house hacking and developing creative, affordable communities. By leveraging modern tools like DealMachine and combining this with a sharp eye for undervalued fixer-uppers, we’re able to create sustainable, social, and sports-oriented housing that benefits both investors and tenants. In this article, we’ll explore:
- Our Acquisition Strategy Using DealMachine
- Why Off-Market Deals Are a Game-Changer for Small Developers
- How This Strategy Ties Into Affordable Development and House Hacking
- Top Tools and Resources for Finding Off-Market Properties
Let’s break it down.
Our Story: Building a List of Off-Market Gems with DealMachine
For our next Village Redevelopment project, I’ve been driving through neighborhoods in San Diego and creating a hand-picked list of distressed properties—over 400-500 so far. These are homes with:
- Big lots (perfect for building backyard units).
- Alley access (allows tenants to park and enter discreetly from behind).
- Properties showing signs of disrepair (a strong signal for motivated sellers).
Using DealMachine’s driving-for-dollars feature, I can add these properties to my list instantly. Then, I automate postcard mailings to owners, many of whom haven’t listed their homes on the market yet. Here’s why this works so well:
- Speed: I can quickly identify, tag, and reach out to property owners.
- Customization: I craft personalized messages to stand out to absentee or distressed owners.
- Efficiency: It’s hands-on, targeted, and gives me a massive edge over competing buyers.
The strategy? Buy undervalued off-market properties, house hack the main home, and develop rental units in the backyard, while integrating our sports- and social-focused design philosophy—courtyards, jacuzzis, gardens, and shared spaces for tenants to connect and enjoy.
Why Off-Market Deals Are a Game-Changer
Off-market properties often offer better deals because they come without the competition of MLS-listed homes. Sellers are typically:
- Absentee owners looking to offload.
- Long-time owners with little interest in dealing with agents or repairs.
- Inherited property owners unfamiliar with the property’s value.
By targeting these motivated sellers, we buy properties well below market value, giving us the margin to finance additions, like accessory dwelling units (ADUs) or multi-unit builds.
Related Reading:
- “The Ultimate Guide to Driving for Dollars” – BiggerPockets
- “Finding Off-Market Real Estate Deals with DealMachine”
Combining House Hacking and Creative Development
Our approach takes house hacking to the next level. We’re not just building a home for ourselves—we’re creating vibrant, affordable communities that tenants love. Here’s how it works:
- Acquire Distressed Properties Cheaply: Tools like DealMachine help us identify undervalued properties with big lots.
- Finance Renovations and Add Units: Using tools like the 203K Loan or HomeStyle Renovation Loan, we build backyard apartments while rehabbing the main home.
- Live Cheap or Free: Rent out the additional units to cover the mortgage, utilities, and maintenance.
- Add Unique Value for Tenants: Our communities are designed with:
- Jacuzzi Courtyards for relaxation.
- Shared Community Spaces for socializing.
- Loaner Bikes and Surfboards for outdoor fun.
- Solar Power and Sustainability Features for reduced living costs.
This model allows us to live in a larger, more enjoyable home with minimal financial stress, while providing tenants fairly affordable, energy-efficient rentals with amenities that make life better.
Tools and Resources for Off-Market Property Hunting
If you’re looking to find your own off-market gems, these tools are game-changers:
DealMachine
- Best for: Driving for dollars and automating direct mail campaigns.
- DealMachine Driving for Dollars
PropStream
- Best for: Finding absentee owners, vacant homes, and paid-off properties.
- PropStream
BiggerPockets Marketplace
- Best for: Connecting with investors, exploring off-market deals, and sharing strategies.
- BiggerPockets Marketplace
Real Estate Postcard Templates
- Best for: Crafting compelling mailers to contact motivated sellers.
- Direct Mail Templates
Why This Matters: Affordable Housing and Financial Freedom
By using house hacking, smart acquisition strategies, and creative development, we’re not just living for free—we’re creating housing that is:
- Affordable: By buying off-market and building efficiently, we offer rents below market while maintaining profitability.
- Sustainable: Solar power, energy-efficient builds, and gardens reduce living costs.
- Social: Shared amenities like courtyards and jacuzzis encourage connection and a sense of community.
For us, this approach provides financial abundance—more time to spend with family, travel, and enjoy life—while also giving back to the communities we love.
Closing Thoughts: Let’s Build Together
If you’re inspired to explore off-market real estate deals, tools like DealMachine and PropStream can help you get started today. Whether you’re house hacking your first property or developing small, vibrant communities like us, the possibilities are endless.
We’d love to hear from others using these strategies! If you’re finding off-market properties or building creative projects, let’s connect—we’re always open to collaborating, sharing ideas, and learning from fellow real estate enthusiasts.
Related Reading:
- “The House Hacking Strategy” by Craig Curelop
- “How to Find Off-Market Properties” – PropStream Guide
- “BiggerPockets: How to Use Direct Mail for Real Estate Deals”
Contact Us:
If you’re excited about building affordable, creative housing or exploring house hacking strategies, reach out! Let’s share ideas and keep inspiring one another.