All Forum Posts by: Dev Horn

If you are looking for a nice simple clean product, that does not require a bunch of technical skill, you should check out the packages offered by Investor Carrot - https://oncarrot.com/ .  Might be a bit more than you want to spend initially (it's not free of course), but why not start with something that works and that you can grow with as your business grows?

(I have no affiliation with this company.  I just like their stuff.)

You are looking for MOTIVATED SELLERS.  All that other stuff (Tax, short sales, etc.) is just a reason for people to be motivated.  I do NOT recommend REOs for new investors as the banks will eat you alive if you are not a real estate professional (and they require real Proof of Funds just to make an offer).

Go find MOTIVATED SELLERS with 3 bdrm 2 bath 2 car garage (3/2/2) houses in the the BOTTOM 1/3 of MEDIAN VALUE for your area.  Cash buyers want RENT HOUSES, not palaces.

The best properties are those that need significant repairs that the owner cannot afford to make. Those properties will not sell at retail value, so the owners are willing to take a lower value that reflects the deferred maintenance. That's the basis of this business. Find those motivated sellers OFF MARKET (not on the MLS) and get them under contract at around:

ARV x 65% - Repairs = Your offer

This will allow you to sell it to a cash buyer for ARV x 70% - Repairs.

If you get it under contract at more than 70%, your deal may not be attractive to cash buyers.

That's Wholesaling 101!

Far enough, the ratio - in your market - tells you where there are more vacation homes perhaps.  We have the same challenge over in Florida, where we're doing direct mail to Absentees in West Palm Beach, for example.  Of course, if you make your copy about vacation homes, guess who you are ELIMINATING in your messaging - landlords and owners of vacant (non-vacation) houses.  Who do you think is more likely to be motivated to sell to you at a discount?  The family with enough dough to have a vacation house out there?  Or the landlord whose rental house just got trashed by his last tenants?

So, I'm still gonna claim to be "right" - ha ha.  You are right that messaging is important - I agree with you but caution you not to market to the WRONG PEOPLE just because there are a lot of them.

Perhaps you mail your beach home message to only people in certain zips and at higher market values (upper 1/3 of market value) - and send the more traditional absentee message to houses that are more inland and in the lower 1/3 of market value. But I think the beach house message is a loser, ROI-wise. If I have a crappy beach house, I can still sell it on the MLS and have plenty of buyers.... because it's a BEACH house!

Hey man, I wish you the best.  Enjoyed the dialogue here.  HAPPY HOLIDAYS!

I think Curt has it about right, although, #1 really depends on your business model and location (market conditions).  If you're a wholesaler in a small market, your assignment fee might be $2,000.  So maybe you could offer either a flat $500 bonus in markets with higher prices and maybe a 10% of profit bonus in smaller markets (if you're a wholesaler).

If you're a rehabber and you can make $20,000 flipping 3/2/2's, offering $500 to these folks and pretty much ANYONE who can bring you a deal would be a win/win.

Man I love to hear this kind of story, Bill!  Wishing you even more success in 2015.  Make sure you hit it hard in January; people often set new year goals to deal with financial issues, and we often see more motivated sellers contacting us in January than any other month of the year.

"Patience and perseverance have a magical effect before which difficulties disappear and obstacles vanish." ~ John Quincy Adams

That is actually a pretty high % of houses (I assume you set to Property Type = SFR) to be absentee, comparing it to other markets where I pull these lists. I don't care much about the ratio as far as how I message to these people. I do care about the ratio when it comes to understanding my farm area and which areas have more rental properties.

Now, the thing is, if you search for COUNTY = Santa Cruz, CA and compare the full SFR count to the Absentee count... you get 20.8% absentee for the entire county! In the county I'm in here in Texas (Tarrant), the ABS to ALL SFR ratio is 12.8% - more in line with what I see in a lot of other counties around the U.S. So, I'm not sure what it is about Santa Cruz county. Looks like you have a LOT of non-owner occupied houses out there in general!

Think about the PROFILE of the person you want to reach and that will help you think thru the messaging. We're looking for tired landlords and heirs who are tired of paying the holding costs on inherited properties. So, the 3 "pillars" of REI marketing work well here:
1) We pay CASH
2) We do it FAST
3) With NO REPAIRS

You can add a little "flavor" to the message for absentees by saying things like "Are TERRIBLE TENANTS or a VACANT HOUSE a financial DRAIN?" - that can make a connection ("Yes, that IS my situation.") but the solution is still built around the 3 pillars above.

Is a Lease Option really considered "creative financing"?  What is being financed via loan?

Awesome to have you involved with BP, Dan!

Man, I could go on a similar rant about what I call the FAKE and REAL worlds of real estate investing in general.  Hint: Gurus sells a FAKE world - sounds easy but unfortunately the world doesn't actually work the way they teach. This is our moto when it comes to REI education:

That said, we need to be careful not lump every person or business that offers "training" or "education" into one big "GURU" category.  I think that's a simplistic approach that results in you dumping on some really good people - like a lot of the coaches I know.  That's what I think people need more than a weekend seminar - they need a mentor and coach that can help them thru the early stages.  So, let's all have some fun with the anti-guru talk, but realize that it's a huge generalization and we need to be careful not to crap on great people who are out there trying to offer a valuable service to people that WANT that.  Maybe you didn't want that, I didn't either, but many smart people - not just the sheeple - seek out quality education or mentoring/coaching to up their game.

Man, I have to agree with @Shane Foster.  Social media is not fertile ground for lead generation.  Sure it's a great way to get some exposure and let your friends know you're in the investing game, but other than that, do not expect leads to pop out of those sites.

I've done paid advertising on Facebook and it stinks for our purposes (finding motivated sellers).  I've spent a ton of time and money marketing on YouTube.  Got a FB page, Google Plus page, etc. etc.  That's all fine, but it DOES NOT GENERATE LEADS.  You do FB, Instagram, Twitter and all those for FUN, if that's how you want to spend your time ;-)

If you want to generate REAL leads online, I suggest two opportunities:
1) Google PPC (AdWords) - it's the best deal - people are SEARCHING FOR US THERE
2) Craigslist - I think it's kind of a wasteland with a gazillion posts by wannabe investors, but I post and repost religiously and get a lot of calls & form submissions from it.  Not as qualified as PPC but the price is right!