Cons to a Direct Mail Campaign?

Question

We are thinking about doing a direct mail campaign with our agent for our primary living residence. Demand is higher than normal in the subdivision we are targeting and we have already lost 2/2 homes we were interested in. Are there any cons of a direct mail campaign besides the unnecessary costs? My costs will be about $60 for 200 homes (.30 per home) which isn't too bad but I am thinking if we do directly mail potential home sellers it might give them a false sense of demand and they may ask for more money than they would posting normally. We are not in any rush (we have until August) and are willing to wait until the spring market brings more inventory but we would like to get an edge on the competition and be proactive if possible. We plan on providing no personal information in-case the home owners find it offensive for some reason. Just a phone number using Google voice and a dummy email address. Appreciate any feedback.

-Ryan

John Barrows · Answer

Bwahahahahahaha, sorry, I had to laugh out loud at the question...... Come on man, your quote says, "We are thinking about doing a direct mail campaign with our agent for our primary living residence".

How about your agent getting off their lazy butt and go to work for you! You can sign an agreement with the agent that ties them to any deal that you or they produce. OMG, if I had a buyer (which I've done over 100 times with contracted buyers in my past 30 years of real estate) I would go house to house knowing I have a pay check and all I have to do is knock on doors. OH MAN! That's not my type of agent!

Look, you can do a VOD (verification of Deposits) and have a loan approval I assume? Just go knock on the door and say I have cash and want to buy your home. Be sincere and let the sellers know your serious. It doesn't get any easier then that for the agent or yourself.....Just don't be a jerk in presenting an offer. Find out the real value of the property and go from there. Sellers will accommodate offers that are respectful and of market value.

I personally made $156,000 commission check because I was looking for land in the city for a developer. I signed all the agreements with the developer that would allow me to have the freedom to get paid and do my job. I knocked on business owners doors and low and behold, I was able to assemble a whole city block with 5 sellers with the cities blessings then had my developer buy the block!

That's called REAL ESTATE. That's what we older veterans did for a living.

May Emery · Answer

@Aaron K. Since you have a limited area that you want, you should look into the Every Door Direct Mail (EDDM) program that the post office offers. With this program, you would be sending a post card to every home in a Carrier Route (CRRT) which is a subset of a zip code.

There are rules about the size of the post card - I think they require oversized, but the postage is a fraction of first class mail.

When you plan your postcard stress that "selling your house will be easier than you think", then talk about how you are prequalified, that they won't have to fix anything or have lots of strangers walking through.

I wrote a blog talking about letters to Seniors, but most of the points apply to the average homeowner who might be thinking that they want to sell but feel a bit overwhelmed at the work it will take.

https://www.biggerpockets.com/member-blogs/11806/84376-your-letter-to-seniors-offer-them-something-they-care-about

Allan Smith · Answer

• cost: how do you get 30 cents per letter? Stamps are 50 and that's not even the cost of materials. Or, maybe you plan to hand deliver the letters. In that case better off door knocking and networking into a deal.
• I would seriously doubt the agent's role here. Go direct to seller, or if they have an agent, remind them that your offer doesnt require paying a buyer agent. If you are finding the deal the agent is kinda useless.
• ya gotta mail more than once. 6 times to each homeowner is best.
• creative recommendations: put picture of your family on letter. Emphasize you are a cool, local dude just trying to be in a good neighborhood.

Aaron K. · Answer

If it is just 200 homes you might have better luck door knocking.  Direct mail campaigns take time, the response rate is low (less than 1%) and it is even lower on the first round, most of the people who respond to direct mail do so after at least a couple times of receiving a mailer.  The other thing is that the impression of direct mail is an investor looking to get a discounted property, which isn't what you're doing, you have a much more compelling narrative that you just love this neighborhood.

Now the pragmatic side of me says it isn't a great idea to only target a single subdivision unless you want to overpay, if I were you I'd broaden my search criteria.