Notes From The June 2015 Boston Investors’ Networking Event

We had a great turnout on Wednesday night, thanks to everyone who came out and participated! Below are the notes from the Q&A part of the event.

• What do you do if there is no inventory, how do you find the houses?
  • Direct mail
  • Be creative when looking at MLS. (i.e. small houses on big lots for teardown and rebuild)
  • Don’t get discouraged. There’s no one source. One person’s source for their first deal was the post man. There is no magical formula.
  • Craigslist, DFD, wife’s book group, softball team.
  • It doesn’t matter what the market is doing, there will always be motivated sellers.
  • Pocket listings. Take an agent to lunch. A lot of listings they take never hit the market.

• How many different marketing campaigns do people use?
  • Direct mail – probate, DFD, expansion, vacant, absentee, equity, attorneys, RE Agents
  • Email & phone follow up
  • Website leads
  • Bandit signs
  • Networking
  • Craigslist
  • MLS

• When one does new construction, do they use a GC?
  • All people who work on our job sites are licensed.
  • For rehabs, one investor manages his own job and hires his own subs who are licensed so they pull their own permits, etc.
  • OSHA can shut down job sites if people don’t know what they are doing and aren’t following the rules. There is a lot of liability involved.
  • It comes down to, do you want to work in your business or on your business. If you want to work in your business, be your own GC. If you want to work on it, hire a GC.

• How do you figure out a rehab budget?
  • Bring a contractor with you to view properties.
  • Have them build you a “cheat sheet” on what things cost.
  • Go to Home Depot/Lowes and look at the prices for products
  • Ask other investors what they pay.
  • It is difficult when starting out. Build a pricing sheet as you go.
  • Labor and materials change with the market
  • Make sure you put in a 15-20% contingency.

• Do you do your own home inspections?
  • When starting out most investors used a contractor or inspector
  • Eventually you will be able to walk the property alone

• How much direct mail are people mailing each month?
  • One investors said 2,100/month, gets 5% response rate
  • Another investor said 300/week, gets 2-3% response rate
  • Be consistent and diversify. Don’t rely on one list or campaign.
  • 1 campaign lasts 6 months. Mail once a month for 6 months.

• What kind of pieces are people sending?
  • Yellow letters
  • Handwritten letters
  • Typed letters
  • Post cards
  • Be creative
  • Spray w/ perfume
  • Find a niche

• Who do you recommend for a mail house?
  • In house
  • Yellowletters.com
  • Click 2 Mail
  • Jerry Puckett

• Where are people getting the funds to buy homes?
  • Hard money
  • Bank financing
  • Friends/family
  • Seller financing
  • Subject 2
  • Partnerships
  • Collateral/ 2nd mortgage