All Forum Posts by: Matt Turcutto

@Account Closed This is actually good advice. I've been contemplating whether I should abandon the direct mail campaign and contact wholesalers. My issues with that at first were simply that I wanted to a) learn the direct mail side so I could have better conversations with wholesalers b) have the ability to cherry pick deals and wholesale the rest myself c) didn't want to pay someone else for the lead if I could do it better in house.

I'm learning "C" may not be as worth it or as true as I initially thought. I think approaching other wholesalers may be the route I need to take if I ever want to get started. I was hoping to be able to uncover the deals myself so I can pocket the wholesale fee or have the option to wholesale out myself. 

@Stanley Parsley You'd have me abandon the direct mail campaign and buy off the MLS then? My issues with the MLS are that most listings in my area have at least a few bidders. I submitted one offer that had 30+ buyers. My final offer was $20,000 above list, all cash and it still didn't get the deal done. That's why I attempted to find the deal before it hit the MLS as to avoid the multiple bid scenario.

@Aaron Mazzrillo Ouch!! A bit harsh but perhaps its true. Here's the copy of one of my emails:

Dear First Name,

I hope this message finds you well. I am a real estate investor and have identified your home on Street in City, CA as a home I am interested in purchasing. I understand that your investment strategies and goals change over time. If you may be interested in selling this property, please give me a call.

I can pay cash, as-is, and close quickly. You will not have to make any repairs, post a sign in your lawn, or deal with realtors bringing buyers through. Your neighbors don’t even need to know you sold your house.

Thank you in advance for your time and consideration.

Sincerely, 

ME

Here's another:

I am looking to buy a house. I saw in the legal notices that you are the administrator of an estate that has a house in a neighborhood I am interested in. I am familiar with estate administration and know that many times the real estate must be sold to close out the estate.

Since you may want to sell and I am looking to buy, maybe we could work out an arrangement that works for the both of us. I can buy the house as-is and close quickly. You will not have to make any repairs, post a sign in your lawn, or deal with realtors bringing buyers through.

Please call me so that we can work out the details. My cell phone is (xxx)xxx-xxxx.

Sincerely,

ME

PS – Now may not be the time to discuss this sale and I understand. Please hold on to this letter for future use. Thank you!

It sounds like what you are suggesting is I should abandon the campaign and focus on what exactly? You are quick to bash my efforts but offer no real solution on how I can improve? Do you think I should go to a boot camp to gain better marketing skills? I'm trying to see what solid advice you can offer. In other words, what worms should I use to catch the tuna?

@Cornelius Garland Thank you for your advice and suggestions. You mentioned my list is essentially worthless if I don't filter out equity. The reason I didn't filter out equity is that I wouldn't mind a short sale or even a subject to if it made sense. I figured for these reasons, its ok if I ignored equity. 

The fact that you gear towards neighborhood with high volumes of cash buyers make sense, but what if the areas I want to invest in (long term) are not the same areas as a lot of cash buyers. Should I change my location or my strategy. I think that's the real root of my initial question.

Andrew Johnson is the answer give up in Orange County or are there better ways to find deals? I live in Orange County and grew up in Orange County. I know OC like the back of my hand and I believe in the long term viability of this market which is why I want to invest here but I really don't know what to do at this point.

@Charlie Nghiem how does one find out if they've had an eviction lately?

@Bob Okenwa thanks for the advice. I think/know you're right. I need to keep going but am just feeling down. 

Just to be clear, I'm sending letters every week but they're to different lists. I hit the same list once a month and am on month 3/5. 

Originally posted by @Aaron Norris:

You're not alone on the mailer front. Since I own rentals I get them. I get the same yellow letter all the time. I'm sure other equity sellers do as well. It's very competitive and I think it has to be part of your method but if you're going to attack with mailers, it's a numbers and follow-up game. 

 Thanks Aaron for the advice. For reference I've posted quite a detailed post on my direct mail campaign here. I do look forward to leveraging Bigger Pockets and towards becoming an active member. 

I recently started a house flipping business (although I'm not sure how good of a business it is since I have yet to flip my first house). After researching for I can't tell you how many years and after what seemed like a decade of analysis paralysis, I am finally taking action. 

On 2/15/2017 I sent out the first batch of white, typed letters. I sent 370 letters. Turns out I misspelled my website and screwed up the return label, but did end up getting a few calls. Each week thereafter I sent another batch until the fifth week when I sent the first list again. I eliminated anyone who bought 2016/2017. 

List 1 was simply my neighborhood. I figured if a deal was going to happen in my own immediate neighborhood it should be me that knows about it before anyone else. Like all my lists, I pulled the list of names and addresses from the title office. 

List 2 was a list of Tax Delinquent homes in areas I wanted to buy. 361 names in all.

List 3 was a combined list of probate and homes that had a Notice of Default filed (I live in CA). 93 combine here.

List 4 was a specific neighborhood I wanted to target. It has no HOA, was built in the 1970's, is in the $600-700k starter range (I live in OC), and is a place I feel has long-term value. 272 homes here.

Since I didn't get list one mailer one back, I have no data, but I do know I had a 4.71% return rate (insufficient address and the like) on list 2, 9.68% rate on list 3 and 1.84% rate on list 4 during the first mailing. The next mailing to the same addresses provided 1.36% return rate on list 1, 2.10% on list 2, 4.3% on list 3 and 0% on list 4 (I corrected each mailer as it came back and before I sent out the next batch). This is returned mail rate, not response rate.

As far as response rates, I received most calls during the first mailer (contrary to what I have read). List 1 generated 12 total calls among all the mailers for 3.3% response rate. List 2 got me a 3.4% response rate. List 3 I received zero calls, and list 4 got me one call at 0.4% response rate. 

List 2 was the only one that got me an actual lead. I submitted a verbal offer and was rejected immediately for being too low. Most calls I got back were, "Who are you? Is this a scam? Why would I want to sell? Don't send me anything else? etc." Each letter costs $0.59 each including postage since I printed everything at home ($0.01 for paper, $0.05 for ink, $0.06 for envelopes, $0.01 for labels, $0.47 for postage from Costco).

I wanted to find a way to do more so I bought 5,000 postcards on VistaPrint and sent my first batch out 4/3 (to list 1), 4/7 (to list 2) and will send list 3 & 4 tomorrow (4/12). So far I've not gotten one singe call from the postcard which surprises me. The letter phone calls came mostly 1-2 days directly after mailing. Postcards cost me $0.37 each with postage ($0.03 for the postcard, $0.00 for ink, $0.01 for labels, $0.34 for postage from Costco).

This brings me to today. I am finding a declining response rate with each supplemental letter I send. I'm told after 5-6 letters is when you get most responses, and I'm resolved to complete 5 letters/postcards before I call it quits, but I'm currently feeling very discouraged. The first two mailings were letters, the next two were/are going to be postcards, then I'm going to finish with a letter.

I have already found my next list of people I want to target. I think I've been doing it wrong in the sense of hitting entire neighborhoods. This next list is a list of 2,300 absentee owners in the 4-5 cities I want to buy in with houses below the $8-900k price I want to stay below. 

My problem is two fold. ONE: I am discouraged from the dismal results from the few thousand I already spent. I'm questioning the success of direct mail altogether. Perhaps my Orange County, CA market is too saturated and there are no deals left to be had? TWO: I don't know if I have it in me to commit to the thousands a proper 2,300 absentee owner list will require of me. I'm already kind of all in and although I could cough up the money for this second list, it would pretty much drain my funds that I've earmarked towards this venture rendering my real estate flipping dreams dead. 

Thoughts/Words of Encouragement/Ideas? 

#WhatTheHeckHaveIGottenMyselfInto

Aja,

I think the correct way to answer this is simply with a, "It depends" response. Granted, if you're anything like me, that's not the cop-out answer you want to hear. In general, I feel listing your house on the open market will get the most eyes on it and allow for the highest sale price. 

Again, this depends on a lot of variables, but in general, real estate is a numbers game and getting your listing in front of the most number of people will allow for the greatest number of offers and typically the highest sales price. 

Just because you list on the MLS does not mean those investors won't still look at your house. The only difference is now you have investors and buyers and more investors and more people then if you just approached one investor.

The reason people sell to investors typically is because they have no other choice (i.e. the tax assessor will take their house next week due to back taxes, or they need the cash in 7 days to post bail, or sometimes they simply don't want people coming to look at the inside of their home before a sale is made). 

It sounds like you have the luxury of time and wouldn't mind it sitting on the market for a month or so. In which case I'd suggest listing the property on the MLS and gathering the most number of offers from the most qualified buyers.

Now for price, I would interview 2-3 agents. Find the agents most active in your market (look at signs in your neighborhood) and call them. Tell them you want to list your house for sale. Don't tell them what you think its worth, just offer them facts (roof is shot, HVAC is trash, etc). Then let them tell you what they think they can sell it for. Then hire the most qualified agent and list it.