This is not what I was wanting to read, we are going to start our postcard campaign in January. Are you mailing all 10,000 each month?
Yes all 10,000 get mailed each month along with another smaller probate campaign with an additional 1,200 leads. Just passed the 6 month mark with these results. It's been pretty discouraging and has me questioning if it's me or the Dallas market.
It’s either an issue with your material or the Dallas market being the target of lots of investors.
6 months isn’t a horribly long time. Have you changed up the pieces at all?
No we usually send out the same mail piece each time for the sake of brand recognition. It's a standard business professional postcard with our business number/website on our call to action.
Remember direct mail has a 99% failure rate, what other marketing are you doing?
you working a market that is over saturated.. I suspect these folks if they are like me.. get a few letters a week each one saying virtually the same thing.. does not take a genius to understand whats going on.
It was very much like when I buy court house steps properties and I walk in and many times the person who lost the house has a stack of their direct mail pieces sitting on the counter.. one house I counted over 150 ... and was always amazed that those wanting to buy pre foreclosure homes were once also just like the poor person in foreclosure and in their exact same situation and if they just call them they will help them..
the money Is made right now selling the direct mail pieces to those who mail them out.. !!! Just like in the gold rush the money was made selling the pots and pans to the gold miners.
and your results even though you have some leads then you need to figure out how good you are at converting said leads.. are you in a position to actually buy them or are you just trying to tie them up and flip them with only putting a few bucks up.. ???
I would think in that strong of market those with actual cash if they know how to present themselves should NEVER lose a deal to someone who is looking to tie up and flip.. NEVER NEVER. if they do they are not ready for prime time and need to bone up on sales skills.
I know I competed against the no money crowd and I never ever lost to them.. unless I simply did not want the house.
@Tiger Butler May I ask where are you getting your data?? and have you looked at any other areas?
I'm curious how people do their Marketing.
Basically, I've always been on the Buyer side in a Saturated Market.
From what I understand, one does pre-marketing surveys before they commit to a full blown marketing campaign to make sure that the Marketing Company had not exaggerated their claims of expected results.
It's now something I'm interested in now that I've gotten my Broker's License and can sell for others.
I want to make sure I give them the best I can and not just list their property because it's the thing to do. That could be a waste of their time and mine. It can also stigmatize the property.
Do anyone actually do pre-Marketing or is that just not done in the kind of Scenario for that the OP Described? What about for potential listings? If there are a gazillion homes listed, do you just come up with a CMA and say, hey.... it will sell for this despite thousands of homes that are similar which qualified for the same Comps in the CMA?
I think I wouldn't want to commit so much money if I don't really have a pre-marketing strategy. But curious about what others think.
It’s not the volume but the quality of the lead. What percentage of your leads are in some level of distress. If I wanted to send out to 10000 sellers tomorrow and I didn’t have a list from prior efforts then I would be forced to buy that list from someone like list source. Level of motivation may not be there. Competition definitely is since it’s so easy to get
I did the same thing 6 months ago. I bought 1000 leads from list source. I did land a deal though eventually but the first few months I only got calls from all the sellers living on Flake City Lane. It’s not just that the sellers were flakey but everybody that wants to do direct mail myself at the time included want the easy way. So yes you have a lot of competition with purchased lists like list source
It takes a lot of work to build a distress Property list but it’s worth it
My calls took off when I started working and building a distress seller list.
If your working in a price range where a high percentage of sellers don’t have issues this might not work as well but if your open in price range then
I would suggest stop mailing such a a large number and spend the money and hire a VA to build and manage that list for you. There are companies that train VAs for our business. I just listened to a podcast by Mitch Stephens a few days ago on this subject. Understand though they will need to be told what to do. So immerse yourself on how to build a good list
Also Listen to podcasts especially those that have guests that are doing this direct mail on a high level and are successful at it. Most of the better hosts will Screen their guests to make sure they are legit. Flipping junkie has great podcasts on direct mail.
If I have to guess I would say there are at least a handful of companies in your area killing it with direct mail. They are just taking a different approach Rethink Regroup Recharge be successful and Repeat
Hey @Tiger Butler and @Jeff Richardson I would probably start by using a heavier mail piece like a letter or flyer. Postcards are so easily overlooked that they can easily just get tossed as junk mail. Also changing up the look of the mailer but keeping a consistent logo will give your prospects something new to look at and will grab their attention! Let me know if you want to chat more I would be interested in seeing the mailer if you want to message me.
Also @Joe Davalos has it right "It’s not the volume but the quality of the lead"
Hope this helps :)
Great post, Tiger. Buying undervalued real property through direct mail has been my full-time career since the 1990s. For every 2,500 offers we mail, we purchase a house. For land, we purchase a property for every 250 offers sent.
Here is what works for us:
We have purchased and resold more than 15,000 parcels of land, SFRs and commercial property and continue to do so, every week, all over the county using direct mail as the only method of acquisition.
Source of DATA:
We only use data compiled by professional aggregators.
Specifically, CoreLogic's RealQuest Pro, Black Knight's TitlePro 24/7 and best of all, First American Title's DataTree. The root of the data comes from each of the 3,400, or so, county Assessors databases. Any other source of "leads" or "lists" we have attempted have not yielded acceptable results for us in the past.
The goal of our MAILER OFFER CAMPAIGNS:
We look for a "situation" instead of a “property” or piece of real estate.
Nearly every property we purchase is surrounded by an owner's social situation which catalyzes their choice to sell. A parent's passing, retirement, empty nest, and family downsize are only a few examples. Also in most cases owners are more than happy to sell for a substantial discount in lieu of prepping the asset for sale (cleaning the house or garage, listing it with an agent or generally talking about pricing or math). I call it the "garage sale" mentality. Everyone who has ever held a garage sale knows they are just about giving away their stuff just to get it out of their lives (usually because they are moving). The buyer and seller know a used broom is worth $25.00 but willingly shake hands on the deal at the end for $2.00 solving each other’s problem.
Who gets an offer?
Every owner in the investors' target market where their asset fits the investors acquisition criteria.
For houses, we say something like this: All the SFRs south of 12 Mile Rd., East of Telegraph Rd, North of 9 mile Rd and west of Woodward Avenue that are less than 2,500 square feet, more than 1,200 square feet and have three bedrooms and two baths. For land, it’s a little easier; all the vacant infill lots in 85250.
Properties associated with back tax, foreclosure, divorce, estate, obituary or any other "lead-type" concepts bring you as the buyer into an asset category that is associated with all kinds of reasons why these problematic transactions will not yield the results you are looking for (they are un-purchasable and send you down a rabbit hole). Specializing in any of these categories, in my experience, is driven by an investor's quest to save on postage and in the end, kills most would-be real estate careers.
What does the owner receive in the mail?
An offer which contains the cash purchase price, closing date and a place to get credible information on who the buyer/investor is and why the transaction will get completed as outlined.
Postcards, colored letters, trickery, threats, false notices of foreclosure, dollar bills, and letters of interest are a waste of money and time and will not yield the results you seek. This is the single biggest mistake I see new investors make and it revolves around saving postage.
We use a plain windowed #10 envelope with a business return address which contains a cover letter and an attached offer and space for the seller’s signature. It’s respectful and super clear. Here is an Example. Or PM me for a copy of what we use.
Some helpful tips from our experience:
Only cash offers and cash deals work. Financed transactions involve too many people and variables and too much time.
Leave agent listed properties out of your acquisition criteria (don’t buy from agents/brokers). They “got there first.” You, as a career investor, should be the one to “get there first.”
We find the buyer (house renovator) first. Then we tailor our offer campaigns around “filling his order” so we never end up with property we need to sell after we buy it. The buyer signs off on the deal, before we purchase it. Make him say something like this: “I just did 6 deals in 85258. If I had three more SFRs at $128-$135 per square foot, I would buy them from you right now.”
We only mail offers to properties with no mortgage or very little loan to value. We have all owned cars where we owe more than they are worth. Home owners are not different.
We only target markets with extremely low days-on-market (less than 45 days) and list-price to sale ratios above .91. Take a look at this dataset of some of the large metro areas, Here. Or PM me for the information.
Finally, some practical advice I wish someone would have told me in 1995:
Give your tools away and turn off HGTV. Wholesaling is way better than renovating.
Buy land as well as houses.
Never leave your desk, its inefficient. Driving for dollars, looking at property or neighborhoods takes time away from analyzing data.
Learn to use data to your advantage or become partners with someone who is a born data person (accountant or engineer). Data is the entire key to success in real estate investing.
Never finance property. Buy for cash, sell for cash.
Become best friends with a few national title agents who put your deals first.
Get to know a lot of real estate agents and never complete a transaction with any of them.
Choose a dollar flooring threshold and stick to it (I only work on deals where we net $40,000+ per deal, for example).
“Inside information” will land you in jail on wall street. In real estate, its encouraged and celebrated.
Lots of great input Jack! Much appreciated!
Thanks for the input everybody. Going back to check the lead quality and revise from there.
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