Could you critique my marketing/deal flow strategy?

Question

Hello! I'm Nicholas, I'm a rookie wholesaler and I've yet to get my first deal. I have a very very small starting budget, essentially I'm going for no more than the $150 a month mark. would you critique what I have planned and tell me where I can improve?

I found that deal flow is essentially a function of how much marketing I do, since i have such a small budget i have to be very efficient with my marketing, so I'm using a "targeted" list. I'm licensed so i compiled the list from a tax/property info database available to us in Texas, so i can save from buying list on listsource. the list is all absentee owners, 3/2, 1970-2000, no recent mls records, price range from 80k to 200k. I've cleaned the list up so that I only kept the ones in good neighborhoods.

at this point my list is around 130 properties. I read that the best way to get a deal done is being persistent and hitting the same leads around 3-4 times and i should get at the very least a 1% response rate.

at around 25 letters a week, i can hit 100 properties a month. I'm looking for a better job at in phone sales (t-mobile, att, verizon, sprint) so that i can make more and up my budget. if i get a job at one of these places i can go from 100 letters to 500+ letters a month easy.

so at 500 targeted letters a month, at a 0.5% response rate, i should at the very least get 1.5 deals done or so a month. maybe averaged out to about 15 deals done by the end of the year.

does this sound accurate and plausible?

now assuming i get the better job (i'm currently at starbucks making less than $8 a hour) I'll have money left over to do more marketing. I was considering investing about $15 a day on Facebook ads. so around $450-$500 a month. can you think of something better or more efficient that i could use that same amount on?

this is strictly for my getting started in wholesaling. my goal is to get at least 10 deals done in wholesales so that i can have enough money and have learned enough from shadowing investors to flip my first house, preferably in a subject-to situation but will most likely be using hard money.

sorry my post is a little messy, but essentially I'd like for you to tell me what I'm doing right, what I'm doing wrong and what I could do better?

I really appreciate your time and advice!

Nick

Jeff Rappaport · Answer

@Nicholas Testa

I applaud you for taking some initiative! I know for a fact you can make this business work starting out with a small budget. Many BP members will tell you it won't work or you are wasting your time. Don't believe them! Believe in yourself! I will tell you that it won't be easy and you should leverage your time to make up for your limited budget.

Sending letters/postcards to absentee owners is fine. However, almost every wholesaler is doing the same thing. You will need to stand out. Make sure your message gives sellers a reasons to call you - guaranteed offer in 48 hours, pay top dollar, etc. Following up 4-6 times is a must!

As far as spending your time to make some money. I am a firm believer that if you become really good at one of three tasks you will always make money in this business. First, finding the deals! You will be doing that with the letters/postcards. You might also want to try some flyers as door hangers in areas you want to buy. How about driving neighborhoods and locating distressed and vacant houses. You may have to track down the owner but it typically comes with less competition. You may want to call or email realtors and property managers and let them know what you are looking for. Keep reminding them. Let them know if they bring you a good deal he/she can get both sides of the commission. You could be calling FSBO and rental ads. They are not usually typical wholesale deals but once you understand the wonderful world of owner finance and lease options you can wholesale those as well.

Second, finding buyers! I am not talking about the same buyers that are on everyone's list. Although not a bad place to start. I am talking about placing ads online, using Facebook, Linkedin, BP etc. and really prescreening what they are looking for. Did you know you can make money right away with buyers. I am currently wholesaling a land development project in Idaho and need a developer to come in and buy this project. I am willing to pay someone $150K for bringing me a buyer. Start networking and really get to know what they are looking for. You can work with other wholesalers that will gladly pay you for bringing a buyer for their deals.

Third, raising private money! Not hard money although there certainly is opportunity there. I am talking about reaching out to everyone in your personal circle (never know who has money) and let them know you can make them a significantly better rate of return on their money than what they are getting from the bank or stock market. I am talking 6-8% interest secured by real estate. Very secure! Don't do this one without looking into the guidelines and laws of your state about whether you need to be licensed.

I know, there is a tremendous amount to learn! However, you can make money ( a lot of money) if you focus on one aspect and become really good at it! Hope this helps you and I wish you the best of luck! By the way, don't ever discount how important education is!

Hattie Dizmond · Answer

I really recommend Google Voice. It's free, allows you to set up customizable messages, will forward calls directly to any number or multiple numbers you choose. The benefit of that is that the calls forwarded to my cell come through with my business name as the caller ID, so I immediately know what the call is regarding. Also, voice mails are transcribed and sent to me via both email & text. And, I get a full log of all the activity. I'm a fan.

Cody Stone · Answer

@Jeff Rappaport I would have voted for this post five times over if I could have! Lots of nuggets in there.

@Nicholas Testa, you are on the right track. I couldn't top Jeff's response if I tried. You might find some great responses by putting up bandit signes near your targeted areas. Use a virtual number with a prerecorded message for sellers when they call. I believe that the voice mail they leave can go straight to your email. I recently heard someone mention the site vumber.com to set that up. I will be using that service soon.

You have made it to the right site and are taking action! Keep up the good work

Nicholas Testa · Answer

@Jeff Rapport that was insanely helpful! thank you so much and I will definitely be taking your advice!

@Cody Stone awesome! I'll be checking that out, because i always get random calls on my phone that i don't answer and it would suck if it was a prospective deal.

Account Closed thats my point exactly, I needed advice as to how I can use those $130 as efficiently as possible so that when I get my first deal I can go for that $1000 budget you recommend.

Account Closed · Answer

130 a month seems a little light. I recommend people just starting out to start with 1,000.

Donnell Evans · Answer

Just do it! Every no is one step closer to a yes. You'll get out of it only as much as you give. REALLY!

Ray A. · Answer

Hi @Nicholas Testa, I wish you much success. PM me, I want to run something by you.

Jess Hewitt · Answer

If I were you and I worked at Starbucks I would network with my customers. I have found that I get my very best deals just by just telling people what I am trying to accomplish. At Starbucks, you must see at least a hundred people every day. You could ask each one if they know of any good deals on a pre-owned house. That's free! Spend your money on some simple business cards* with your contact information. If they have any deals then hand them your card and ask them to send you the information or ask them to write it on the back of your card with their information (you will use this card as your reference with the homeowner). If they are looking for a home, again ask them to write on the back of the card or they can contact you after hours (you are adding retail buyers to your list - which are gold, but their interest decays quickly).Then remember to answer your phone - don't let it go to voicemail. Then use your training and buyer's list to put together deals. Use the $150 on fuel to get out and see these houses and meet your investors. PM me and I will join your buyer's list.

Good Luck and Keep Us Posted!

* Cards should be simple with your name, phone, fax, email, website if you have one, company name if you have one, no need for any fancy logos or slogans - you can use these cards for anything. I have one that I have used for years that is "personalized" with both my wife's and my name and our contact information - we use them everywhere for anything. No one else has a contact card for husband and wife and it makes an impression that I am giving them our personal contact information. Of course the address is our PostNet, the phone number are Google and cell and the fax is my eFax, I do give them my personal email address.

Nicholas Testa · Answer

@James Messa yes! I have about 20 very serious investors, about half of them if they're not interested will forward the deal to their network and split the profits, although I'm still working to build more, I'm not going at it as diligently as finding a deal.

I'm also working on contacting wholesalers and working together so that if they have any properties they can't sell, i'll connect them with a buyer and we can split the profits.

Awesome! yes I'm curious so I'll contact you right now.

@Hattie Dizmond that sound great! I've heard a little about it but never actually got to using it. I just signed up, thank you :)

James Messa · Answer

@Nicholas Testa

Have you started networking to build your buyers list yet?

Do you know how to fill in the TREC contract?

How is your salesmanship? I'm terrible at it but getting better.

You have stiff competition here in Houston, with people receiving 10 letters or more each day. It's really kind of crazy but persistence will prevail.

You may think about a marketing co-op. Share that expensive with others so that you can get 1000 pc out a month.

Send me a PM if you want more information. I am on my 3rd month of 1000 pc per month and trying to land my first deal.

Could you critique my marketing/deal flow strategy?

Could you critique my marketing/deal flow strategy?

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