List Building: best practices?

Question

Greetings!  New investor in the Colorado Springs area.  I've identified the neighborhoods I'm interested in farming, and started building my mailing list.  Through a combination of walking my dog through my target neighborhoods to identify distressed/vacant homes, and combing through the pre-foreclosure list for homes that meet my investment strategy, I've got a pretty meager list.  Leaning on people with experience (especially in Colorado!), do you recommend buying mailing lists?  Where is a good place to start?  I'm skeptical on the quality of lists someone else may provide, but I also don't want to spend all my time finding homes to mail to!

Darren Smith · Answer

The simplest answer I've found to this question is to simply mail to houses that have the minimum required equity in their home.  For example, if you're going to be wholesaling, you'll need at least 65% equity.  There are dozens of other formulas I've seen people use to figure out which houses they mail to, and I'm sure many of them work well.  But when it comes down to it any house can be a good deal if there is enough equity.

As far a where to get your lists, the most common source is listsource.  To make things even easier for you, yellowletters.com will provide your list, write your letters, and mail them all out.  Of course there's a price for this, but it's what I'd do if I had the cash.

Another option is to just focus on an entire area you want to buy in and hit every house.  You can do this with the USPS every door direct mail program for about 30 cents a door.  An even cheaper option is to buy door hangers for 5 to 10 cents a piece and pay someone 12 to 20 cents a piece to hang them.  This marketing is much cheaper, but then you'll be hitting a ton of houses that you have no chance of buying.  There's a chance you'll find a deal you would have missed only mailing to people with equity, but more likely you'll just be wasting a lot of door hangers.

Good luck!