All Forum Posts by: Dev Horn

Truth is, you can do both, and many successful investors do.  All you have to do as a licensed agent is DISCLOSE to a motivated seller that you are licensed, but acting on your own behalf as an individual buyer of investment properties.  Then, if you find that the seller is simply not interested in your low but quick cash offer, you can offer to list it on the market as a fall-back plan. 

Start as a wholesaler - you can do that right away.  Then, if you find you have interest and ability in real estate, go for you license later.

Are you in this to be a "wholesaler" or to "make money".  If it's the latter, you will ultimately want several ways to accomplish that.

Fair enough, @Zach Mitchell! I have found a few of my deals on the MLS, so it's not impossible. =)

Very interesting, @Ariel Cohen.  I think you are on to something there; you have exposed an issue that could have resulted in us only getting duplex, triplex, and quads in our 963 records.  The course correction may be to pull these as 2 different lists (one using equity% and the other not using it) and then combining those 2 to get our total list.  Based upon what you've found here, we are going to re-pull those lists.

In Riverside county, I believe we discovered that because I see in that county we used only the Residential: Multi and Residential: Apt property types and we did NOT use Equity% on that list.  It's been a while since we pulled that one, but I think we discovered what you did - that those 2 property types do not have the Equity% data.

Good work man, I'm glad we discussed this!

1) Definitely different marketing pieces.  We are still looking for distressed properties, so some of the language is the same, but definitely a different piece for MF.  We think it should be a bit more professional and not feel/look too much like "consumer" marketing.

2) Currently we are just hitting them repeatedly with the single MF postcard.  We mail to them every other month, so they will (hopefully) see this piece 6 times in a year.  A sequence would be great, but may not result in any measurable increase in response rate.

3, 4, 5) Listsource data varies by county as far as what is available (that you can filter with).  So you may have to experiment to find out which combination of filters works best in your market (on Listsource.com).  Here is an example of the filters we used in one of the CA counties:

Oddly enough (for MF properties), "absentee owned" reduces your list size considerably. So we're using it just like we use it on their SFR data.

In Riverside county, we just used the Residential: Multi-Family and Residential: Apartment property types.

Sometimes we just use (or don't use) filters because we are trying to get a certain size list - like if I want to mail to 1,000 MF property owners in San Joaquin county... I start with the broader MF list and whittle it down with Total Assessed Value, Equity % (when available), etc.

Hope that helps!

HERE'S AN UPDATE WITH EXAMPLES OF OUR MARKETING PIECES

We've had good results in Multi-Family, meaning our licensee that we first did it for - Tarek El Moussa (star of HGTV's "Flip or Flop") - got a positive ROI early on and we have continued the marketing to this group ever since. I don't know and cannot share his exact numbers (we don't get into our client's businesses or take a cut like a franchise does). I just know they reported getting deals from the campaign and decided to continue (we hit that prospect pool every 2 months). We've now been mailing into the Riverside County (CA) market for them for a year.

Our original marketing piece for multi-family was specially designed for Tarek, to leverage the notoriety that he and Christina have with their show.  The approach was to make the back of the postcard read more like a LETTER than a typical postcard, which we felt was more appropriate for the Multi-Family owner.  Here's the piece we went out with a year ago:

Since then, we have launched multi-family for another licensee - Frank G. Silveria III - down in the Stockton/Modesto market.  For that, we made a generic MF postcard based upon the successful piece we made for Tarek:

We are very early on in Frank's campaign; not sure if he's closed any deals yet, but the response has been in line with our expectations.  Feel free to check in with me later and I'll have more insight on how it's going in this 2nd market.

Other licensees in our program are now considering expanding to multi-family (MF).  It is something that you really need to understand - there are a lot of differences compared to investing in Single-Family Residences (SFRs).  So it's not something that people just "try". They have to have a specific strategy and process to approach multi-family, from the funding aspects, how to manage renovation projects that are much larger scale that an SFR rehab, having the proper business entity in place to own and operate MFs, etc. etc.

A couple of other things I'll mention:

DATA - We've used the multi-family lists from Listsource.com.  Data quality seems good, as usual with Listsource.  Allows us to define MF property types,  # of units, market value, and equity % just like we do with the data on SFRs.

BRAND - When you have a brand that is all about buying houses, you have a challenge when going after MFs regarding your identity. We solved it with the simple addition of "& Multi-Family, Too!". That seems to work, and we may even have some of those recipients calling about an SFR they own, instead of or in addition to their MF property. But you may want to consider a special landing page for MF that is all about that, rather than sending to the SELL YOUR HOUSE page on your BILLBUYSHOUSES.COM website. In our marketing here, we are driving them to CALL rather than go to the site.

Hope that report helps you guys see how we've begun to do MF and hopefully there are some good ideas here that you might incorporate in your own MF marketing.  There is a huge profit potential in MF; if you have your ducks in a row, give it a shot!

"Never let the fear of striking out keep you from coming up to bat." ~ Babe Ruth

@J Scott, @Michael Quarles, @Brian Gibbons, @John Jackson, @Account Closed, @Jerry Puckett.

There are no DEALS on the MLS because EVERYONE has a shot at them because... they are on the MLS! As a result, there will ALWAYS be a handy-man type guy looking to get a good deal on a house by putting in some sweat equity. That guy will out-bid you EVERY TIME because he doesn't need a 30-40% discount. He's happy with a 10-20% discount. You cannot beat that guy or his real estate agent.

You must market for motivated sellers and attract unlisted properties where the owner sees the benefit of taking a cash offer rather than putting their house on the market, which could require them to make costly repairs with $ they don't have.

I like 3 methods for reaching the off-market, motivated seller:
1) Direct mail, to people WITH EQUITY, especially absentee owners
2) AdWords (Google Search marketing)
3) Outdoor (billboards, bandit signs, bus signage, etc. etc.)

Click on my FACE in this post and watch the video in my user profile here on BP - it's called "The Search for Motivated Sellers".  ;-)  This is THE #1 CHALLENGE for all of us.  No leads, no BUSINESS....

Way to go out there and MAKE IT HAPPEN WITH WHAT YOU HAVE!

I have no idea, but I would bet you can get away with bandit signs out there in Methuen and Lawrence, MA.  So that's not a bad idea.  You get different calls from signs - unqualified, don't know if they have any equity, could be a mobile home, etc.  So you have to weed thru them a bit more, but bandits will give you the lowest cost per call.

Continue to do postcards to absentees with equity.  For God's sake don't hand-write them.  Don't tell people you want to "$Buy$" their house.  Instead, speak to the problems of maintaining a vacant house, or dealing with problem renters. etc.; show how you can solve those problems.  People respond when you make that connection between their problem and your solution.

I often see good call volume from mailing 1, then crappy call volume on mailing 2 to the same group.  Expect that.  It picks back up thru mailings 3, 4, & 5.  Absentees are THE best pool to hit on a regular basis - we mail to them monthly.  If you've created a memorable "brand" for yourself, those prospects will remember you after you've touched them about 7 times (see The Rule of 7 - video).

"As for the future, your task is not to foresee it, but to enable it." ~ Antoine de Saint-Exupery

Right, you are way too early in this to get discouraged!  I teach about the Rule of 7 (touches) in marketing - we do a ton of direct mail in markets all over the U.S. and I can tell you that leads come from consistency and building some "brand awareness" within your target market.

Bandit signs work but attract unqualified sellers.  With direct mail we can touch only those sellers with equity, etc. that meet our specific criteria.  That makes marketing much more efficient.  The other workhorse we like is Google AdWords - people SEARCHING for our solution.  That is golden.

"The wise make more opportunities than they find." ~ Francis Bacon