I got a question this week from someone that is trying to get started in real estate investing. This woman has decided to start with absentee owners and her question to me was:
I have managed to get the names of a few absentee owners. Now, what do I mail to them?
In her mind, once she had the answer to that question she would be all set. But, as you know, there is so much more to this process. The mail piece is only one, small part of the puzzle.There are a few systems and procedures you need to get in place before you even start your business.
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Here Are Some Tips for Starting off on the Right Foot in Your Real Estate Investing Business:
1. You Need a Game Plan
In order to succeed in this business, you need a steady stream of leads; there is no denying that. And there are a lot of ways to generate those leads. One of the first things you need to decide is which marketing strategies will you use. Your budget for marketing is likely going to play a part in this decision. If your budget is so small that you can only start with a few names, your success will be very slow to come.
2. Decide on the Marketing Strategies You Will Start With
I love direct mail. This is hands down my best source of leads, but if you are short on cash this is not the strategy you want to start with. Bandit signs, networking, cold calling or even door knocking are free or low cost. The important thing is to just decide and begin.
3. You Need a Good List
If you plan to do direct mail campaigns, you will need a good list. One thing in her question really bothered me and that was when she said, “I have managed to get the names of a few absentee owners”. Any success with direct mail is going to come about with a good, substantial list; not a few names. This is a numbers game, and it doesn’t work if your numbers are too low. I don’t know yet how many names she has or where she got those names.
4. Where Do I Keep All that Information?
Before you ever send out that first direct mail letter or postcard, you need some basic systems and procedures in place.
Ask yourself this; once you get your list where will you store these names? Where will you keep notes about motivated sellers when they call? How will you manage the implementation of your marketing plan?
You can upload a spreadsheet to a mailing company if you plan to outsource your mailings, but this doesn’t mean that you don’t need a database. You need some type of contact management software. Over time you will have a lot of information.
5. What Will I Say to the Folks that Call?
What to say to motivated sellers is one of the most asked questions that I get. I recommend that everyone start with a property information sheet to use as a guide on those first calls. It helps you to get all of the information that you need. But only use the sheet as a guide; don’t use it as a script. Your calls with sellers should always be conversational.
The second thing you can do is to role play. Practice what you will say when someone calls. Be sure to answer all of your calls when you are just starting out so that you get comfortable talking to sellers early on. It just takes practice.
6. Create Follow up Systems
You have no doubt heard the saying, “The money is in the follow-up”. This is so true.
If you are just getting ready to send out your first mailing, you probably haven’t given any thought to follow up systems. But the truth of the matter is that the right time to figure this out is actually before you send out your first mailing.
7. Planning + Execution = Success
My advice to anyone just starting out is to take the time to plan and create these basic systems and procedures. By having just a few simple things in place, you will start off on the right foot and you will feel much more prepared when your phone starts ringing.
Do you have some other suggestions for things every real estate investor should do before they take that first call from a motivated seller?