TL;DR
- Single signal (absentee only): 1.1% conversion
- Tax delinquent 3+ years: 4.2% conversion (vs 1.1% general absentee)
- Triple stack (absentee + tax + high equity): 3.8% conversion
- Probate with out-of-state heir (100+ miles): 4.8% conversion
- Hidden Gems (AI-identified non-obvious patterns): 2.9% conversion with 45% less competition
Conversion Rates by Signal Type
Not all distress signals are equal. Here's what the data shows:
Financial Distress (Highest Conversion)
Tax Delinquency by Duration: | Years Delinquent | Conversion Rate | Competition Level | |-----------------|-----------------|-------------------| | 1 year | 1.4% | Very High | | 2 years | 2.3% | High | | 3+ years | 4.2% | Medium | | Tax sale scheduled | 5.1% | Medium-High |
The 3+ year threshold is the sweet spot: owners have accepted their situation but haven't yet been overwhelmed by investor mail.
Pre-Foreclosure Timing: | Days Since NOD | Response Rate | Close Rate | |---------------|---------------|------------| | 0-14 days | 3.8% | 2.3% | | 15-45 days | 2.9% | 1.8% | | 46-90 days | 1.6% | 0.9% |
Speed matters. The first 14 days post-NOD filing yield 2.5x better results than waiting.
Client Results
“The Hidden Gems were skeptical at first - properties that didn't fit my usual criteria. Then I tracked them: 6 of my last 14 deals came from Hidden Gems. They had 45% less mail competition because nobody else was targeting them.”
— San Antonio investor, 68 deals/year
Code Enforcement: Properties with violations requiring $15,000+ in repairs convert at 3.1% when combined with absentee status. The key filter: violations older than 180 days indicate owners who've given up on fixing.
Life Events (High Intent)
Probate Performance: | Heir Location | Conversion Rate | |--------------|-----------------| | Same county | 2.1% | | Same state, different county | 3.4% | | Out of state (100+ miles) | 4.8% |
Distance creates motivation. Out-of-state heirs managing a property remotely want resolution, not rental income.
Divorce Windows: - 0-30 days post-filing: 1.2% (too early, still negotiating) - 30-60 days post-filing: 2.8% (peak window, decisions made) - 60-90 days post-filing: 2.1% (many properties already listed)
Property Burden Signals
Vacancy Duration: | Months Vacant | Conversion Rate | |--------------|-----------------| | 1-3 months | 1.1% | | 3-6 months | 1.8% | | 6-12 months | 2.9% | | 12+ months | 3.4% |
Every month of vacancy adds carrying costs. After 6 months, owners have typically exhausted alternatives.
The Hidden Gem Pattern
Practical Signal Stacking
Tier 1: Build Your Base Stack
Start with the signals that compound well:
Foundation Stack (3.8% conversion): 1. Absentee owner (base filter) 2. Tax delinquent 2+ years (financial distress) 3. Equity 60%+ (deal math works)
This stack reduces list size by 85% vs absentee-only while tripling conversion.
Tier 2: Add Situational Layers
Overlay based on your market:
Probate Overlay (+1.4% conversion boost): - Add: heir out-of-state - Add: property vacant 90+ days
Pre-Foreclosure Overlay (+0.9% conversion boost): - Add: NOD filed within 21 days - Add: owner-occupied (more motivated than investors)
Tier 3: AI Enhancement
Let predictive scoring identify Hidden Gems you'd miss: - Non-obvious patterns from closed deal analysis - Behavioral signals humans can't stack manually - Market-specific correlations updated quarterly