All Forum Posts by: Cornelius Garland

@Gregory Carter Hey Greg, one thing to keep in mind is that marketing is a numbers game; the more volume you 're targeting, the better chance you have to get motivated sellers that want to sell. However, I think some investors take this to the extreme and target any property owner without narrowing down their list. Driving for dollars can definitely get you some deals, but it will take you a long time to get a deal by only getting 5 properties a day. On average, it's taking me 63 leads in order to get a deal. This doesn't mean out of every 63 people that contact me, I'm closing a deal; this means it's taking me 63 people that raise their hand and say "yes", I want to sell to close a deal. The number of people that agree to my cash offer is few and far between. When it comes to direct mail, your response rates will be around .5-1%. This means if you were to mail 1,000 pieces, you can expect 5-10 sellers to call you. However, only a fraction of those will be somewhat interested in selling. 

I'm not saying all of this to discourage you but to make the point that you're going to have to get your numbers up to see a decent ROI. I've seen investors that have only targeted 100 properties through driving for dollars close a deal, but their mail piece was very unique and the houses they were targeting clearly had distress. I would aim for 20 properties a day and write each seller a yellow letter and place it in a colorful envelope with stickers on it. You want to do whatever you can to make your mail piece stand out because other investors are going to be mailing your sellers, too, because the seller is most likely on their mailing lists. Granted, a lot of investors use the same direct mail companies so their mail pieces will look the same. You have the opportunity to stand out by tweaking your envelope and handwriting your letter. I suggest targeting properties that look like they're distressed. If you see cars in the driveway and someone is living there, this can likely be a tenant that isn't taking care of the property.

If you want to build out a mailing list then check out listsource.com. This will save you so much time instead of manually compiling a list from the tax assessor site. You can filter your list to only target absentee homeowners, property owners that bought their houses before 1980 and also filter by equity.

@Jared McNeel Hey Jared, I wouldn't necessarily say door knocking is better than direct mail because both have their pros and cons. I do, however, think you'll get higher-quality leads door knocking. You do need to keep in mind that you'll still need to get in touch with several homeowners. Only door knocking to a handful of homes isn't going to cut it. I wouldn't suggest mentioning the seller's situation to them, though. For instance, if you're targeting preforeclosures or houses on the auction list then I would approach the homeowners as if you're just randomly door knocking. You can mention that if they are going through some sort of distressing situation then you have an option for them. You don't want your realtor to go right out and say "Hey, I see your property is about to get foreclosed on. We have some options for you." As long as you're hitting at least 100 doors a day, I'm sure you'll have several qualified leads to work with. Not a lot of people are doing this, so you won't have any competition, and you'll come across as a legitimate company to the sellers.

@Shannon DeLaune Great explanation, and this makes sense. I'm targeting a list of fire-damaged properties exclusively and this information definitely helps. I'll ensure I have my leads check on their insurance policy before I agree to buy it. I don't want any surprises at closing. I had one situation where I was about to close on a fire-damaged property and the seller backed away an hour before closing. I'm sure it had something to do with the insurer advicing him not to move forward with the sell. Thanks for the information.

@Jay Ingram Thank you for the in-depth post on this process. I'm looking to buy my first rental with a VA loan in the next few months. While I hope I'm never in this situation, it's always best to know what to do in worst-case scenarios like this.

@Shannon DeLaune In your experience, when can a homeowner sell their property if they don’t want to fix it? Would they need to wait until the insurance adjusters do their assessment of the damages, or could the homeowner sell beforehand. I’m looking at possibly buying a fire damaged property as my first purchase. Thanks in advance.

I've been in your spot before. If you're aiming to buy multifamily properties, then I would definitely pull a targeted list of sellers and market to them. When I was helping a friend get more units, I had him pull a list on List Source of everyone that owned complexes with more than 5-100 units. However, I told him to exclude any properties owned by LLCs. We just wanted "mom and pop" owners. I'm not saying that you can't get deals from LLC owners; however, most of them are playing the same game as you and will be reluctant to give you a good deal.

After you have your targeted list, I would add phone numbers to the list because this gives you another way to target your sellers. If you're just doing direct mail, you're going to be missing out on some sellers that may not be receptive to direct mail. Similarly, if you're just doing voicemail broadcasting, some sellers may not respond to that. I would type a formal letter to these sellers and also include a credibility kit that has background on you and the properties you've worked with. This puts me ahead of my competition.

I would hit them with direct mail, text messages, cold calls, and voicemail broadcasts aggressively for a month and then let your foot off the gas on month two. Once you've identified warm-to-hot leads, focus the majority of your attention on those. You'll get deals. Let me know if you have any other questions.

@Jason Miles Datazapp is subpar, in my opinion. Their hit rates are less than 40% and they don't provide which numbers are wireless or landlines. They reached out to me a few months ago indicating their data improved; however, I didn't see any difference in the quality.

@Brandon Beatty I found that it's time-consuming to skip trace the wrong numbers rather than just following up with the leads that came in. However, I rarely get wrong numbers whenever I skip trace my lists, so this is a non-issue.

@Tyana CarpenterI actually have a huge flowchart that addresses what happens based on how the leads respond to my marketing. Here is an overview, though. I work with large lists. In January 2019, I messaged 130,890 sellers and we closed 10 deals, during down months. December and January are very slow months for us. We're gaining a lot more traction now. Our sellers were waiting until late-January to late-February to move their properties. If our sellers want an offer, we have our VAs vet those. I rely on my team of VAs to do a lot. I would say a lead is dead if they opt out of our marketing or respond negatively to our messaging (i.e., cursing). If they say no, we'll put them on a month followup. I will aggressively target my lists for 2 months then "retire" it for a few months. The great thing about having the skip traced lists is that the sellers rarely change their phone numbers. I'm closing deals off of lists I skip traced 2 years ago. It's way quicker and less expensive to shoot the sellers an RVM or text message than to do direct mail. Also, it's easier to track. I do cluster marketing, so I'll cold call the lists at the same time as I'm sending RVM to it. I don't overthink it. One way to look at it is that you can never market to your sellers too much. Sure, some sellers may get upset but I don't care. I need to find motivated sellers. The more times you touch the sellers, the better.

@Autumn Allen I'll send you a message.

@Cameron Robinson I sent you a message as well.

@Michael Batts Thanks for the kind comments! I try to give back whenever I can. I hope my posts help you out.

@Darius Anderson When I'm scoping out a new market, I always go where the investment activity is happening. One way to do this is to find all of the zip codes in your target market and determine how many cash sales there were in the previous 12 months. If you have MLS access, then you can easily research these stats. I jump from market-to-market, so to get a realtor in every city I analyze would be time-consuming. I do this by going on List Source and entering in set criteria that can give me an estimate of how many there were. This isn't the most accurate way, but there's only about a 5% margin of error as compared to the MLS. Here is the criteria I use:

I just enter in my zip code to get the number of cash sales in that particular zip. If you see there are like 100 sales in a zip, that's a good sign where you need to be investing in. It's hard to argue that 100 other investors are wrong with where they're buying. Go where the experts are! Hope this helps.

@Darius Anderson Not South Carolina...I don’t even invest in my own backyard. The cities are too small, and the sellers in the hot zip codes think their houses are sitting on gold. Texas, some areas in Georgia, and South Florida are areas where I’m focused.