Today I want to talk about how to get better results marketing to absentee owners. Like probates, these are off market sellers that I’ve had good luck with over time. You can read all about it here, or listen to the podcast below.
I only market to out of state absentee owners myself, because I have found them to be more motivated to sell than in state absentee owners. Over the years, I’ve discovered that these property owners need to be at least 3 hours away from the property before it becomes too big of a hassle to keep the property.
Marketing to Absentee Owners
Marketing to absentee owners is simple, and it is very cost effective since you can get great results with postcards. You can send out 1000 oversized postcards for under 50 cents each. That includes the postage and a mailing company doing all the work.
You can put your direct mail campaigns on autopilot when you outsource them to a direct mail company. They can do it for you as cheaply (or cheaper in some cases) as you can do it yourself. Putting your direct mail campaigns on autopilot, is the one thing that will have the most significant results on the growth of your business.
Postcards vs Letters
I have used postcards for all of my direct mail campaigns except probates for a long time. However, if you want to give letters a try, I have a sample letter that you can download. Some mail pieces work better than others in different markets so it doesn’t hurt to test a couple of different mail pieces.
There are a lot of different marketing strategies for your real estate business and if they are done properly and consistently, for the most part they all work. Those two words “properly and consistently” are the keys to success.
Here’s an Example.
If you want to market to absentee owners and your strategy is to drive around and look for vacant houses, will you find any absentee owners? Possibly. But that is definitely not the best way to find them. One surefire way to successfully market to absentee owners is through consistent direct mail campaigns. They are very effective at bringing you those types of leads. Be smart with your marketing and you will get much better results.
The Problem with Out of State Absentee Owners Is….
The problem with out of state absentee owners is that you have to wait until they become motivated sellers.
They might not be motivated to sell today, next month or even next year. However, we all know that time and circumstances change all things. One day, most of them will want to sell the property. I have bought properties after marketing to absentee owners for more than 3 years. I sent 36 postcards at a cost of less than $18.00, and I made a $12,000 wholesale fee. So, you be the judge. Was it worth it?
You wouldn’t want absentee owners to be the only group of people that you market to, however, this is definitely a niche that you want to add to your motivated seller lists. Over the years, I’ve gotten plenty of deals to make it worth my while to market to these folks.
New Strategies for Increasing Your Direct Mail Results
I want to take a minute to tell you about some brand-new things on the horizon that can dramatically increase your direct mail results. I’m going to have a show soon just to talk about these two services, but they are IP marketing and ringless voicemail. When you implement these along with your direct mail campaigns you can see a significant increase in your results. In fact, ringless voicemail, when added to your direct mail campaigns has been shown to increase the response by up to 400%. That is huge! So, let’s dive into getting a list of absentee owners.
Where Do You Get a List of Absentee Owners?
There are a number of services that will sell you a list of absentee owners. I have found these lists to be anywhere from “OK” to pretty good depending on the list source. Listsource.com is a company that I have used for a long time, and I’ve been happy with them. For the most part they will be pretty accurate, but you have to get used to the fact that there will be some inaccuracies with any company. You can skip trace these leads if it is a really good property.
You can also get a list of absentee owners from your local tax assessor’s site. When I first started out, I was using them for my list and I found their information to be very accurate. The problem with their list was that the only filter I could use was zip codes. I could omit certain zip codes, but there was no other way to filter the list. It was also more expensive than using Listsource.com.
One of the most important filters to use in an absentee owner list, is the equity piece. I only select properties for my list that have 50 to 100% equity. So, why is that? Because by the time you back out repairs and other costs, you’re generally going to be buying the property at 50% of the retail value or less.
The good thing about most of the major list services is that you can set up parameters for houses to include and/or exclude. For instance you can:
- Omit zip codes in less desirable areas
- Determine the value range of the property you want on your list ($50,000-200,000)
- Select the number or bedrooms and bathrooms
- Choose whether the house has a basement
These are just a few of the criteria you can select. There are many more.
List services allow you to build a list that meets your criteria and where you only get properties in those areas where you want to buy. For me, that was always homes in “bread and butter” types of neighborhoods. When I buy a list, I always leave out areas that are bad, are considered to be war zones, or are areas where I know my end buyers won’t want to buy.
What About Higher Priced Homes?
I also leave out areas that contain higher priced homes. The reason is that they are not a good fit for investors in most cases. I have found that wholesalers, rehabbers and landlords don’t want these houses in most cases. Homes that are at or near the median or average sales price for homes in my area are the best leads for me and for my end buyer who is always an investor.
What is the Number One Rule for Success with Direct Mail Campaigns?
Once you have your list of names, you need to set up a direct mail campaign. The important thing to remember about direct mail is that you need to mail to these folks consistently over a period of time. How long is that? It depends on the niche. Marketing to absentee owners is a long-term strategy that will pay off if you stick with it.
The process where is set this up is called a campaign. You can do the mailings yourself or have them done by a mailing service pretty affordably. Once again, outsourcing your mailings will get them done on time. You can simply place the order online.
My Rule for Marketing to Absentee Owners
I have just one rule when it comes to how long a direct mail campaign should be.
I mail to these folks until I buy the house, someone else buys the house, or they ask me to stop mailing to them (which almost never happens).
The only other time I take these absentee owners off my list is if I have spoken with them and there is some reason that I’m certain I cannot buy the house. The property may be 100% financed, or it may be in a family trust. Since my exit strategy is wholesaling, I wouldn’t be interested in seller financing, lease options or other types of creative financing. However, if you are a rehabber or a buy and hold landlord, your exit strategy would be completely different from mine so you might still be able to put together a deal.
What if They Say No to Your Offer?
If I make an offer on the house and they don’t accept my offer now, they aren’t necessarily saying no (forever). In many cases it just means “not now”. That doesn’t mean they won’t say yes at some future date.
I always ask permission to keep these folks on my list and continue mailing to them in the event that something changes. If their “plan A” doesn’t work out, I want to be positioned to be their “plan B”. Always leave the door open to come back at a later day. Wish them luck and at the same time remind them know you would like to be their “plan B” if something changes.
One Final Tip
Be sure to send them a thank you note (whether or not you get the deal) and include your business card. Remember… you're leaving the door open to be their “plan B”.
If you mail consistently to absentee owners, this will bring another stream of leads and income for your business if done properly. I highly encourage you to add these folks to an automated direct mail campaign.
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