An absentee owner owns property but does not live on it. Learn about absentee owners and what it means in real estate.
Becoming a homeowner has long been the American dream. You wake up in a home you saved for and bought and return to that home after your long day.
But what about a homeowner who doesn’t live in the houses they buy? They’re called “absentee owners,” and many make good income with their property.
What is an absentee owner?
An absentee owner owns real estate property but doesn’t occupy or actively manage it. Examples include:
- Commercial real estate investors
- Landlords with property managers
- People who inherited property
- Owners of vacation homes
- Homeowners on military assignment, sabbatical or other long-term absence
In some cases, an owner needs to live outside the area to truly be considered “absentee.” For example, an absentee owner in San Antonio, Texas, must live outside Bexar County.
There are other regulations as well. Some cities don’t consider owners of multifamily or commercial properties “absentee.” However, for real estate investors, defining an absentee owner as a non-occupant is enough to narrow the field.
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How to find absentee owners
Some absentee owners are happy with their situation, but many aren’t. An Airbnb or Vrbo owner might have trouble finding tenants and want to unload the property. An apartment landlord might be tired of problem tenants or confused by tenant law.
Plus, not every absentee owner wants to rent. An inherited home can be a huge burden, especially if it goes to multiple siblings and no one wants to take control of maintaining or selling it. Then there are the vacation homes that sit vacant, unoccupied and unrented. All of these homes make great prospects for investors.
If you’re looking to buy absentee-owned property, here are 10 ways to find opportunities.
1. Search tax records for out-of-state owner addresses
Elizabeth Sugar Boese, an investor and real estate agent with Coldwell Banker in Boulder, Colorado, frequently seeks out absentee owners. She recommended using a county’s property assessor records.
“You can look up a specific property, then click on the map to look at each neighbor’s property,” Boese said. “If the public records show a tax or mailing address that differs from the property site address, you just found an absentee owner!”
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Once you have the owner’s mailing address, reach out with a postcard or letter. Postcards are ideal if you plan to do a bulk-mail campaign. They cost less to send and help you get your name on the owner’s radar.
2. Drive the neighborhood
Many absentee-owned properties are vacant or poorly managed. These homes have telltale visual signs of disrepair or disuse, such as:
- Neglected landscaping
- Damaged paint or siding
- Blinds that are always open or closed
- Boarded windows or doors
- Digital or combination door locks
- Newspapers or fliers collecting out front
- Lingering “For Rent” signs
To find these properties, identify a promising neighborhood and start driving around it.
Don’t choose a run-down area. You’re looking for an investment that will return, so pick a place where people want to live. Look for houses in poorer condition than their neighbors, especially if they have any of the above signs of vacancy.
Real estate investment pros call this “driving for dollars.” It’s time-consuming but an effective way of finding properties others haven’t found.
Not local? Use Google Maps to virtually tour neighborhoods using Street View. Once you have the property address, use tax records or hire a skip tracing company to find the owner.
3. Browse rental listings
Absentee owners typically rely on rental income. If a property lies vacant for extended periods, the owner has more reason to sell.
Regularly check rental listings in your business area. Look for listings that have been up for several months. Frequently relisted properties are also promising. If you think the owner might be a motivated seller, use the listed contact information to reach out.
4. Search short-term rental sites
Many absentee owners rent their properties on sites like Airbnb, which has more than 4 million hosts worldwide.
While some hosts live on the property and rent out rooms, many live offsite. It can be a lucrative business—the average host makes close to $14,000 a year—but there are substantial costs. Hosts typically pay a 3% Airbnb fee plus any other costs of property ownership.
An Airbnb business can quickly become unsustainable if the host doesn’t get consistent bookings. Search Airbnb and similar sites like Vrbo, focusing on your target neighborhood. If a listing has broad availability, the owner might be looking to sell.
5. Check public records for tax liens
Absentee owners without rental income may have trouble paying their property taxes. If they default, the government can put a lien on the property.
A lien gives the government rights to the property. In some cases, tax authorities can seize and sell the property. Getting rid of the property is often in the owner’s best interest, but selling can be difficult—unless the buyer is willing to pay off the lien.
Find properties with liens by searching the records of your county’s tax assessor, recorder or clerk. When in doubt, ask your municipal government for the correct office.
6. Get a Property Ownership and Encumbrance Report
Multiple companies sell what’s known as a property ownership and encumbrance report. This gives you the current owner’s address, which notes whether it’s absentee-owned. The report also lists any liens on the property, so you can easily scan for potentially motivated owners.
7. Use property search software
Searching tax records and driving around neighborhoods are effective and reliable methods, but they take some legwork. Jordan Fulmer, owner of Momentum Property Solutions in Huntsville, Alabama, prefers to use property-search software.
“There are numerous platforms out there that aggregate public records and save you the time of going to the courthouse and scrubbing through it yourself,” Jordan said. “With just a few keystrokes, you will have a list of every absentee owner in your area and be able to mail or call them about buying their house.”
- ATTOM Data Solutions
With these platforms, you can filter your search for absentee owners and get an instant list of leads.
8. Post to online communities
With effective online marketing, absentee owners will come to you. Start by posting on sites like Craigslist, which is free for all users. Create an ad offering to buy unoccupied homes and list it in any category that seems relevant. Many buyers list under “real estate services.”
Another option is to post on social media. Buy an ad and target it to a certain area, or join a local homeowners’ group and start participating in conversations. Look for mentions of unoccupied homes in the area.
9. Partner with industry professionals
Many professional service providers come in contact with absentee homeowners. For example:
- Estate lawyers work with heirs who inherit houses and don’t move in.
- Divorce lawyers represent clients who want to move out of the family home.
- Home insurance agents may sell vacant-home insurance or landlord insurance.
- Title company representatives have records of unoccupied homes.
If you build relationships with these professionals, they can send you the names of absentee owners who want to sell. Offer to recommend their services in return.
10. Network with local service providers
Landscapers, handymen and even mail carriers know who doesn’t live at the address they own. Strike up conversations with these providers—perhaps while driving for dollars—and get leads you may not have otherwise.
Absentee ownership pros and cons
Once you buy a property from an absentee owner, you might hand it over to a third-party management company. That makes you the new absentee owner. If you’re considering this, here’s what you might love and not love.
Own property in multiple locations.
An absentee owner doesn’t have to limit themselves to one market. You can own property anywhere, provided you can find a trusted management company to run things day-to-day.
Spend more time expanding your portfolio.
As an absentee owner with third-party property management, you don’t have to spend time solving problems on the ground. You can spend that time hunting for and acquiring properties.
Hands-off ownership can leave you vulnerable.
Even if you hire a management company to run the day-to-day details for your properties, you’re ultimately responsible as the owner. You must ensure your properties comply with all local, state and federal guidelines.
Less contact with tenants.
As an absentee owner, you’re responsible for keeping tenants happy. If your management company falls short, your reputation is on the line.
The best solution is to take a hands-on role for the first few years as you look for a property-management company that meets your standards.
Is absentee homeownership worth it?
Absentee ownership benefits investors and buyers who can hire quality managers. That said, having a manager isn’t entirely hands-off. You still need to communicate with your management and troubleshoot.
If you can commit the money and time, especially at the outset, absentee homeownership is an effective and efficient way to expand your portfolio.
Getting started in absentee homeownership
If absentee ownership is a new part of your real estate journey, start small and local. Look for one or two local properties and source a well-respected property manager. Take some time and get used to the process. Before you know it, you’re ready to expand.