Types of motivated sellers, ranked by what actually sold
By Josh MillerUpdated 5 min readThe motivated sellers who sold most often had something happen to them on a date: a foreclosure filing (about 13 of every 100 sold off-market within a year) or a listing that expired (about 12 of every 100). Owners defined by what they have, like free and clear or over 65 and living elsewhere, sold at 1 to 2 per 100, about the same as any house.
Every list tool sorts owners into "motivated seller types." Most of the types are about what the owner has: equity, age, a second address. The ones that sell are about what just happened to the owner. That's the whole idea of this page, and the county records back it up.
Two kinds of seller
Event sellers had something happen on a date: a foreclosure filing, a listing that died, a lien, a divorce, a death. The date tells you when to show up.
Standing sellers are defined by a fact that sits there for years: free and clear, high equity, over 65, vacant, behind on taxes. Some of them sell, most of them don't, and the record gives you no clue when.
The types, ranked
| Seller type | Of every 100, sold | Kind | Counties |
|---|---|---|---|
| Foreclosure filed | 13.1 | Event | 99 |
| Listing expired or cancelled | 11.9 | Event | 492 |
| Lien filed against the property | 4.2 | Event | 249 |
| Divorce filed | 4.2 | Event | 8 |
| Sitting vacant | 3.8 | Standing | 468 |
| Behind on taxes, 2 to 4 years | 3.1 | Standing | 479 |
| Behind on taxes, 5 or more years | 2.9 | Standing | 233 |
| Judgment against the owner | 1.8 | Event | 70 |
| High equity, living elsewhere | 1.8 | Standing | 1,794 |
| Owns it free and clear | 1.5 | Standing | 2,170 |
| Owner 65+, living elsewhere | 1.0 | Standing | 823 |
Source: GoForClose count of off-market, arm's-length deeds in county records. A house picked at random in the same counties sold off-market at about 1.2 to 1.6 per 100. Divorce is counted only in the 8 counties with enough records, leaving out states whose records don't mark MLS sales.
What the ranking says
- Events beat standing facts. The top two are both events with a date. The bottom three are standing facts.
- Not every event is a good one. A judgment against the owner, a debt that follows the person, not the house, sold at about the rate of a random house. A lien against the property itself sold at about 4 per 100.
- The biggest lists are at the bottom. Free and clear owners number in the tens of millions. That's why they're mailed so much, and why so much of that mail goes to people who aren't selling.
Probate and the rest
Probate, code violations and utility shut-offs aren't in the table, because the licensed data most investors buy covers them too thinly to count county by county. We have a ranking from a different source. In one client's market in Tennessee, with the market and the years held the same for every list, we ranked each list by how often its houses sold. From the top: pre-foreclosure, a foreclosure in the county, a tax sale, then probate, then code violations and vacant houses, then obituaries, divorce, owners living elsewhere and utility shut-offs. Free and clear and high equity came last, below the market as a whole.
Speed is part of the type
Expired listings sell early: in most counties, the biggest share of their off-market sales came in the first 3 months. Foreclosure owners sell late: across 99 counties, about 3 of every 100 sold in the first 3 months and about 13 by month 12. The same letter at the wrong time is a wasted stamp. When to mail each list.
Which type should you work first?
It depends on your county. The order above holds in most places, but the gaps move. Expired listings sold at about 15 per 100 in Harris County, Texas, and about 8 in Denton County. Answer three questions and get your county's answer.
Questions investors ask
What are the types of motivated sellers?
Owners facing foreclosure, owners whose listing expired, owners with a lien or judgment, owners behind on taxes, owners of vacant houses, heirs in probate, divorcing owners, tired landlords, and owners with lots of equity. They differ a lot in how often they actually sell.
Which motivated seller type sells the most?
Owners with a foreclosure filed: across 99 counties, about 13 of every 100 sold off-market within 12 months. Expired and cancelled listings came next at about 12 per 100 across 492 counties.
Are high equity owners motivated sellers?
Mostly not. Across 1,794 counties, high-equity owners living elsewhere sold off-market at about 1.8 per 100 within a year, about the same as a house picked at random. Equity makes a deal possible; it doesn't make an owner want to sell.
Which motivated sellers sell fastest?
Expired listings: in most counties the biggest share of their off-market sales came in the first 3 months. Foreclosure owners sold more slowly, with most of their sales after the first 3 months.