I have a guest post today from a fellow real estate investor Chris Feltus of Feltus Family Homes..
Chris has adopted one of my favorite strategies for dealing with unmotivated sellers, which is to completely ignore the fact that they are unmotivated at this time. Like me, he has also come to know that time and circumstances change all things. Today's completely unmotivated seller, may become very motivated at a later point in time. So What's the lesson here? Keep marketing to those folks.
Some of you know “Sharon's Rule” where that is concerned. I only quit marketing to those people on my list if I buy the house, someone else buys the house, or they ask to be removed from my list. That's it!
You can read Chris' post below…
When dealing with inbound seller calls, I try not to be too picky in terms of who I set an appointment with. If I have no appointments booked for the day, I will most likely take a look at the property unless it’s clear from the phone call there is absolutely no potential in the lead. If nothing else, it allows me to practice my rapport building. As long as there seems to be enough equity and there is potential to work together I will take a look. Sometimes some of the inbound calls I receive seem quite unmotivated at first glance. Many of you at this point would discard the lead and go on to the next one. However this can be deceptive and I will walk you through why.
First Contact
Let’s take a look at a lead from back in April. I have various lines in the water when it comes to filling my deal pipeline. One of which is absentee owners. The seller contacted me off a postcard mailer I had sent him. The property had been vacant for several months and needed some rehab, mostly cosmetic work but some minor foundation as well. Let me make this clear, from the phone call the seller seemed completely unmotivated, but I booked the appointment anyways.
Making the Offer
I made the offer at the property, and the seller didn’t seem too interested and wanted a few days to think it over. I called him several days later, and the seller didn’t seem even slightly interested with my offer. Which leads me to my next point to digress a little.
Show them that you are offering them a fair price based on the amount of work the house needs, the comps in the area etc. And that you are not pulling this number out of thin air and trying to take advantage of them. Educate your sellers if they need some hand holding.
Begin the Follow-Up Process
Even though the potential in this deal for all intents and purposes seemed dead, I scheduled to give him a call every month or so. I would just give him a brief call stating something to the effect “Hey, this is Chris. I met with you at your property on 123 Green Street just wanted to call and check in to see if you might be interested in selling your property”.
The first couple months of doing this, he politely said no. Until…
Enter July
This time when I called back the seller, I could sense a distinct tension in his voice. Something had happened; nothing major like an illness or facing foreclosure. I will keep the details private, but the point is “no” doesn’t mean no forever. As time flows, circumstances will change, and that can turn a firm “no” into a excited and under contract “yes”.
Remember the first time I got in touch with this seller was back in April. How many of you would have even booked the appointment? Much less, how many of you would have continued to follow up after you made the offer? Most of you would have given up after one month. It took 3 months later for me to get the property under contract.
No Doesn’t Mean “No” Forever
In my business here in the Dallas – Fort Worth area I see this happen quite regularly, and it allows me to beat my competition in a very competitive market. Very few other investors bother to follow up. I would venture to say more than 70% of the homes I get under contract are from follow up. If there is one “secret” in this business besides being consistent and persistent, its follow-up. Don’t ever underestimate it.
Special thanks to Sharon for allowing me the honor and privilege of guest posting on her blog. Thanks for reading and if you have any questions feel free to leave them in the comments below and I will do my best to address them.
My thanks to Chris Feltus for this insightful post. If you have a home to sell in the Dallas – Fort Worth area, be sure to stop by Chris' site “Feltus Family Homes”. Chris can help you with your problem property today.
If you haven’t already subscribed to join the “Inner Circle”,be sure to do that today so you don’t miss any of the business building tips I have coming your way. I want this year to be your best year ever! And if you enjoyed this article, please share it.
Chris discovered his passion for real estate early on working for a land developer.
His primary focus in real estate at this time is wholesaling. When not involved in real estate he enjoys spending time with his wife and painting.
I have one city with around 200 out of state owners and another with 650….should I start mailing these owners monthly??
Between mailing monthly and putting out bandit signs consistently we should have some good results in the next few months!
I would Tara – Having a big list of names that is not highly targeted like Chris and I do just won’t get you deals. How big is the city you live in?
Sharon
Tara Brown
on September 13, 2013 at 8:04 pm
Chris/Sharon,
So do you two suggest I mail to my list even though it only has around 250 names of absentee owners that live at least 2-3hrs away? I can mail to them monthly……
Thank you so much for your kind words and reading.
When I pull absentee-owners I like to operate within a certain tax assessed value, 75k to 130k. Within this price bracket, here in TX, there are alot of properties that will lend themselves to individuals that both flip and sell, and buy and hold. Since DFW is so large I typically only pull absentee owners from Tarrant County, where Fort Worth is located. I also filter by deed date, the property must have a deed date at least 15+ years back. This is a rough approximation of equity but it typically works. To get a good deal typically the owner must be motivated AND there must be enough equity in the house to buy at a discount.
I then filter the database further to get my final results by including:
1. Out of state absentee owners that own property here in DFW and
2. Absentee owners that live in state, but have a significant drive time to the subject properties. Like Sharon I use 2-3 hours. Please note, this will likely only work if you live in a larger state.
I then combine the above lists and that becomes my absentee mailers list for the year.
Hope that helps, please let me know if you have anymore questions 🙂
I only mail to out of state absentee owners. Here you can get to one end of the state to the other from where I live in about 3 hours.If you don’t use that type of criteria, you will get a ton of names of folks that live 30 minutes away in the next county. They aren’t really absentee owners, so you will most likely be wasting your money.
I use:
Out of state absentee owners for the counties where you want to buy
Home values of $50k to $300k (our median price is 143k or so)
Equity of 50% or more
I omit war zones and bad areas by zip code
Omit corporate owned (sometime trust owned)
What you are looking for is not a huge list of names just for the sake of having a large list; you want a targeted list of folks that could be motivated sellers.
Sharon
Tara Brown
on September 13, 2013 at 1:06 pm
Chris, great article!
Sharon, you mentioned in a different post that you mail to absentee owners that live at least 3hrs away from their property/properties.
I recently purchased a list of single family absentee owners for my area from listsource…..has 2100 names. However, after I went thru to find owners living 2-3hrs away the list shrunk to around 250.
I’m probably just going to split the whole list of 2100 names in half and mail to them every 60 days. I’d imagine there’s got to be a lead in there somewhere. And if I implement the follow up just like Chris mentioned deals should start to pop!
Tara Brown
Cedar Rapids, Iowa
p.s. Chris, what sort of criteria do you use for your absentee list?
First thank you for taking the time to read through my article, I hope it assists you in some way in your business.
Regarding your question, here is how I execute my marketing plan. Near the end of the year I pull a list based on specific criteria such as: deed date (rough approximation of equity), tax assessed value, year built, sq footage. To further filter the list I look for “red flags” that may indicate motivation such as: code violations, vacant properties, absentee owners etc. I also acquire estate leads every month that I continue to mail to until the house is sold or I am told a firm No.
The number of leads I pull from the list is dependent upon what my monthly marketing budget is. For example if I can afford to spend $1,000 per month on mailers (you don’t have to start here) that’s roughly 3,000 post cards.
Continuing on the above example, then you break your large list, into 3 groups of 3,000 leads. Group A, B and C. Then for the whole year I continue to mail these groups rain, sleet or snow. The mailing schedule might look like this
Group A – Jan 3,000 cards
Groub B – Feb 3,000 Cards
Group C – March 3,000 Cards
Group A – April 3,000 Cards
Groub B – May 3,000 Cards
In other words, each group gets mailed 4 times a year by me. And then at the end of the year I pull a new list. When I pull a new list there will be some overlap and many leads will continue to receive mail from me.
The key is to continue to be consistent and persistent, no matter how large or small your budget if you stick with it you will find deals. At some of the houses I buy they have a stack of post cards 9x tall at the dinner table to give you an idea.
Samantha – I scrub or update my list ever 6 months or so. You really need to do that. People will come off and new ones will be added each time. I mail monthly.
Sharon
samantha
on September 4, 2013 at 10:50 pm
This is a great guest post guys, good work both of you. I have couple questions for both of you if you dont mind. Sharon you stated you like to implement “sharons rule” you keep mailing them until they say no or have sold. Do you ever pull new lists or do you keep the same list every year and contineu to mail?
-Chris, do how do you schedule your mailers? Do you pull a new list at the end of the year?
Thanks you guys
~ About Sharon
Hello from Louisville, KY, and thanks for stopping by my blog!
I love this business, and I am passionate about helping other people become successful real estate investors.
Come along with me on my journey as I create a business and a lifestyle that I love.
I have a guest post today from a fellow real estate investor Chris Feltus of Feltus Family Homes..
Chris discovered his passion for real estate early on working for a land developer.
His primary focus in real estate at this time is wholesaling. When not involved in real estate he enjoys spending time with his wife and painting.
I sent you an email. Who are you using for your direct mail?
Thanks Sharon for sharing your advice on this blog! I’ll let you know how things go!!
Tara – Absolutely! Get started this week.
Sharon
I have one city with around 200 out of state owners and another with 650….should I start mailing these owners monthly??
Between mailing monthly and putting out bandit signs consistently we should have some good results in the next few months!
If you know that area or can learn that area, it would probably be a good thing. You could really branch out then.
You may not have a lot of competition then. Do you have a REIA group you can join?
A lot of investors in my area buy on the MLS and/or at sheriff sales……from the research I did looking at the sold houses the past 6 months.
There is a city about an hr away with around 300,000 people. I’ll probably mail to out of state owners for that area as well.
Do you live near a bigger city where you might also do some marketing?Also, do you know if anyone in your area is doing direct mail marketing?
You can build a nice probate list over time by adding new probates every month.
The city is about 150,000 people……I’m going to be mailing probates and putting up signs in addition to the out of state list.
I would Tara – Having a big list of names that is not highly targeted like Chris and I do just won’t get you deals. How big is the city you live in?
Sharon
Chris/Sharon,
So do you two suggest I mail to my list even though it only has around 250 names of absentee owners that live at least 2-3hrs away? I can mail to them monthly……
Hey Tara,
Thank you so much for your kind words and reading.
When I pull absentee-owners I like to operate within a certain tax assessed value, 75k to 130k. Within this price bracket, here in TX, there are alot of properties that will lend themselves to individuals that both flip and sell, and buy and hold. Since DFW is so large I typically only pull absentee owners from Tarrant County, where Fort Worth is located. I also filter by deed date, the property must have a deed date at least 15+ years back. This is a rough approximation of equity but it typically works. To get a good deal typically the owner must be motivated AND there must be enough equity in the house to buy at a discount.
I then filter the database further to get my final results by including:
1. Out of state absentee owners that own property here in DFW and
2. Absentee owners that live in state, but have a significant drive time to the subject properties. Like Sharon I use 2-3 hours. Please note, this will likely only work if you live in a larger state.
I then combine the above lists and that becomes my absentee mailers list for the year.
Hope that helps, please let me know if you have anymore questions 🙂
Tara –
I only mail to out of state absentee owners. Here you can get to one end of the state to the other from where I live in about 3 hours.If you don’t use that type of criteria, you will get a ton of names of folks that live 30 minutes away in the next county. They aren’t really absentee owners, so you will most likely be wasting your money.
I use:
Out of state absentee owners for the counties where you want to buy
Home values of $50k to $300k (our median price is 143k or so)
Equity of 50% or more
I omit war zones and bad areas by zip code
Omit corporate owned (sometime trust owned)
What you are looking for is not a huge list of names just for the sake of having a large list; you want a targeted list of folks that could be motivated sellers.
Sharon
Chris, great article!
Sharon, you mentioned in a different post that you mail to absentee owners that live at least 3hrs away from their property/properties.
I recently purchased a list of single family absentee owners for my area from listsource…..has 2100 names. However, after I went thru to find owners living 2-3hrs away the list shrunk to around 250.
I’m probably just going to split the whole list of 2100 names in half and mail to them every 60 days. I’d imagine there’s got to be a lead in there somewhere. And if I implement the follow up just like Chris mentioned deals should start to pop!
Tara Brown
Cedar Rapids, Iowa
p.s. Chris, what sort of criteria do you use for your absentee list?
Hey Samantha,
First thank you for taking the time to read through my article, I hope it assists you in some way in your business.
Regarding your question, here is how I execute my marketing plan. Near the end of the year I pull a list based on specific criteria such as: deed date (rough approximation of equity), tax assessed value, year built, sq footage. To further filter the list I look for “red flags” that may indicate motivation such as: code violations, vacant properties, absentee owners etc. I also acquire estate leads every month that I continue to mail to until the house is sold or I am told a firm No.
The number of leads I pull from the list is dependent upon what my monthly marketing budget is. For example if I can afford to spend $1,000 per month on mailers (you don’t have to start here) that’s roughly 3,000 post cards.
Continuing on the above example, then you break your large list, into 3 groups of 3,000 leads. Group A, B and C. Then for the whole year I continue to mail these groups rain, sleet or snow. The mailing schedule might look like this
Group A – Jan 3,000 cards
Groub B – Feb 3,000 Cards
Group C – March 3,000 Cards
Group A – April 3,000 Cards
Groub B – May 3,000 Cards
In other words, each group gets mailed 4 times a year by me. And then at the end of the year I pull a new list. When I pull a new list there will be some overlap and many leads will continue to receive mail from me.
The key is to continue to be consistent and persistent, no matter how large or small your budget if you stick with it you will find deals. At some of the houses I buy they have a stack of post cards 9x tall at the dinner table to give you an idea.
Samantha – I scrub or update my list ever 6 months or so. You really need to do that. People will come off and new ones will be added each time. I mail monthly.
Sharon
This is a great guest post guys, good work both of you. I have couple questions for both of you if you dont mind. Sharon you stated you like to implement “sharons rule” you keep mailing them until they say no or have sold. Do you ever pull new lists or do you keep the same list every year and contineu to mail?
-Chris, do how do you schedule your mailers? Do you pull a new list at the end of the year?
Thanks you guys