I've posted some on SFR and my partner and I are jumping into Multi-Family properties. I am in the process of selecting an area that has good job growth and strong economy, which is a criteria for my repositioning strategy.
My goal is to finance 100% of the deal through lending institutions and seller. I have about $50,000 in working capital (which is the reason for 100% financing as this capital will be set aside for any deferred maintenance repairs cap ex etc.) and another $5,000 I have allocated to marketing.
I have attempted marketing before but had a response rate of about 4% but yielding no SFH deals. I am in the military so I don't always have access to be able to answer my phone on marketing.
How do people go about finding an area to invest? I have a specific set of criteria I am looking for but with all the cities and suburbs, having a hard time identifying where to look.
How have you all been marketing for your deals? I am moving from SFH to MF like I said and I am assuming the good deals are normally off market especially looking for 100% financing. How do you guys market and network for deals from afar? Do you have any suggestions with my lack of availability to be on and answer the phone?
Look forward to hearing from everyone and hope we can all learn something sharing our knowledge.
@Douglas Vogel As you noted, response rate is essentially meaningless.
If I had $5,000 and $5,000 only, I would spend about 1 month opening a website in my target market, allocate $600 per month to the hottest long-tail keywords on Google Adwords, and begin the process of ranking your website organically. The more narrow you tie your keywords, you can keep budget quite low. Unfortunately, you will lose control of the type of property in exchange for enhanced motivation to sell.
You can hire a VA or use a call answering service, or just accept the fact you need a good voicemail and get back ASAP.
That said, that won't really help you target MFH. The only way I'm aware to target MFH would be too work MLS and/or buy a DMM list for those types of properties. MFH is rough because these people are often investors - so you should run their names in the local appraiser to make sure they do not own property (or list vendors can often target the mailing address to a limited number of property ownership).
@Lucas Machado Thanks for your response. You do a lot of online marketing for sellers? I did PPC marketing once and I didn't know what I was doing and ran up a $1,000 bill in about a week and a half after I thought it was set to $50 / week. haha. I definitely learned my lesson!
MLS is good my only concern would be not being taken seriously by the broker as I am looking for a bit of a "creative" deal on the financing end. I have also heard places like list source can narrow down MFH but that wouldn't be internet marketing more of a direct mail approach.
@Douglas Vogel I started PPC about 2 years ago, and my two weeks were crazy. It was a good learning lesson though. You need robust negative keywords and proper keyword modifiers. I actually just tightened my modifiers to even higher levels because I was not pleased with the level of randomness Google sometimes allows, when left to it's own devices.
I think one thing to keep in mind if you're doing PPC is that your goal and Google's goals aren't the same. Your goal is to get the most bang for you buck, Google's goal is to take all your bucks : )
@Lucas Machado "if you're doing PPC is that your goal and Google's goals aren't the same. Your goal is to get the most bang for your buck, Google's goal is to take all your bucks : )" ...well said!
5k as you know is a bootstrap budget but I agree with Lucas that you'll at least want to get the foundation of your website in place and start toward organic rankings. Relying on ppc is like forever renting-- no real asset growth.
You can get someone on fiverr to put a basic wordpress site together cheap and install the "squirrly" plugin which should help guide you along to do some foundational stuff yourself. Target 1 long-tail keyword that's untargetted for each page you build and get 1000 word articles for each page targeting the keyword. it's usually best to target a location word combined with the easier keyword for what you do. Collect these keyword pages like baseball cards until you officially have an asset.
@Douglas Vogel I find deals by being active in my market, talking to agents, and farming the areas that I am interested in buying. Old fashioned? The best deals are not on the internet. The right kind of marketing will turn up results, but that is the easy part. You have to be ready to take the call and solve the problem for the seller.
@Anthony Dooley Good advice. Can I ask how you became active? Sure I have done SFR deals but being out of state (in the military) and trying to "break into" a market has some big challenges I am trying to overcome. I understand connecting with individuals who play a part in your market is key and I am currently doing that, but without being able to sit there and take every phone call that may or may not come in from a marketing plan, how do you manage that? How do you set it up so you can spend your energy solving the problems and not answering phone calls from every person trying to get top dollar for their property? Sorry for the delay, I am currently out of the US so I can only check BP so often.
I am active locally and I do very little marketing to specific owners of property. I stared investing while in the Army a few years before retirement. It made retirement very easy.
There are ways to do it the way you describe. Hire a Virtual Assistant. You can train them to do the marketing and take the calls. They can screen out the time wasters and oy connect you to motivated sellers, which is only about 5% of the market. This will still be a challenge while on active duty.
I recommend listening to Epic Real Estate Investing podcast. Matt Theriault has mastered virtual assistant and automation.
Thanks @Anthony Dooley ! I tried one Virtual assistant outfit but couldn't answer phone calls etc.
Thanks for your service! Thats great you were able to do that while still active and thats my goal too! I will definitely look at epic real estate investing and see what I can learn from them.
Do most of your deals come from your network if you aren't doing any marketing?
I find deals by driving for dogs in neighborhoods that I know, wholesalers, Realtors, and some online. Listed price is irrelevant to me. I offer what it's worth to me. There are also landlords who want to sell all or part of their portfolio.
@Douglas Vogel Thank You for serving! First I would pin point exactly what type of apartments you want, 5-28, 24-150, etc. 2. Visit sites like http://www.best-cities.org/ and figure out what states then cities you are going to target. 3. Either call the city and ask for a list of apartments or buy a list from a list broker, or what I did go to www.apartments.com and create your list. 4. Set up Pat Live - www.patlive.com to handle your calls 24-7 from your mailers and only call back the cream of the crop. 5. Take your list of prospects and upload it into a mail house like vistaprint.com and have them print, label and mail the letters/postcards for you.
The biggest thing is get laser focused on what you are looking for, i.e. I am looking for 24-150 units in C+ to B areas constructed after 1982 to 2008 in X, Y, Z states. So if you get a call that doesn't match that you know to throw it away and take it off your mailing list. I hope that helps and is somewhat clear.
@Pat G. My pleasure. Thanks for posting and that is some good information. I have struggled on training virtual assistants and what to say how to say it etc. to incoming callers but thats why I need to check out epic real estate investing podcast. I'm sure it comes with networking but I know for repositioning I'm looking for (currently) 5-30 units C-B area in certain cities but is there any good way to compile that list? I have hard a hard time targeting the specific areas, motivated sellers to mail to thus getting average return rate on mailing but no motivated people, wasting time.
@Douglas Vogel You are welcome. Here is a list of some of the other podcasts and websites I listen to:
- Podcast: Apartment Building investing with Michael Blank
- I have taken his course -good
- I have taken his course and attended his boot camps, several years ago
- Facebook group - http://www.multifamilycommunity.com this link will redirect to facebook where you will have to as to be in the group.
- Podcast: Lifetime cashflow through Real Estate Investing. Good Pod cast
Apartment Investors of Michigan - Facebook group
The Commercial Real Estate Show with Michael Bull
Target Market Insights with John Casmon
Best Ever Real Estate investing Advice with Joe Fairless
The Real Estate Guys Radio Show
The Wealth Formula Podcast with Buck Joffrey
Wheelbarrow Profits with Jake and Gino
Hope that helps.
Great list. Another podcast I'll add is the Old Capital Podcast. They are a commercial lending broker who handles a large share of the multi-family loans here in Texas. Their guests are a Who's Who of the multi-family industry in the area. Even if you don't intend to invest here, the lessons apply in most other markets too.