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Sow Seeds – Reap Rewards.
July 26, 2010 by Esi · 31 Comments
The last 2 weeks have been very busy. When I first started wholesaling, I mapped out a farm area of about 8 zipcodes that most of my buyers are interested in purchasing houses, and have been marketing exclusively to those areas. In my last marketing effort, I sent out postcards to Absentee owners and after 2 days my phone started ringing off the hook. On Tuesday 7/6, I sent out 1040 Postcards and got the first phone call on Friday 7/9.
Men tend to have a more authoritative voice and from experiments, people tend to respond to a guy’s voice and follow the instructions given. Since real estate investing is a male dominated business, I thought using my husband’s voice in the recording would be a good idea. So on Tuesday night after sending the postcards, my husband was up till 1am recording the voice messages. We just switched to using Google Voice for our voicemails and since Google Voice only allows 3 minutes of record time, we decided to experiment with a shorter version of our voice message and after several editing, we were happy with what we ended up with. Luckily, he didn’t sound too sleepy.
Here is a breakdown of the call we got within 2 weeks of sending the postcards;
Friday 7/9 – 19 calls
Saturday 7/10 – 48 calls
Sunday 7/11 – 6 calls
Monday 7/12 – 66 calls
Tuesday 7/13 – 32 calls
Wednesday 7/14 – 10 calls
Thursday 7/15 – 13 calls
Friday 7/16 – 10 calls
Saturday 7/17 – 3 calls
Sunday 7/18 – 2 calls
Monday 7/19 – 7 calls
Tuesday 7/20 – 4 calls
Wednesday 7/21 – 6 calls
Thursday 7/22 – 5 calls
Total number of calls – 231 (22%). By the way this percentage is way more than average. Google Voice records all the calls even if the hangup was within a second of placing the call, so that might be why it’s so high. Or, I guess the competition is very low. Either way, I’m not complaining 
Thanks Shae for pointing it out in the comments
Number of people who left voice messages – 112 (11%)
Number of people I called back after listening to voice messages – 58 (6%)
Number of Motivated callers – 29 (3%)
Number of Very good Leads that were close to my asking price – 12 (1%)
Number of houses under contract – 6
Number of houses to follow up every week till they tell me to piss off – 6
Number of angry calls – 1: Yeaaa, I finally got an angry call, If you want a good laugh, listen to it here. I almost fell out of my chair laughing.
Breakdown of the houses I got under contract and need to sell in 45 days.
First House
Seller: Realtor/Investor.
Reason for selling: Seller purchased an REO last year and have been renovating the house, but unfortunately ran out of money towards the end of renovating, he is disillusioned, no more interested in pouring money into the house and needs to sell ASAP. Seller refused my offer at first, but called 2 days later and was willing to negotiate. After several back and forth calls, we finally agreed on a price.
Got a signed contract: 07/16
Found Buyer: 07/19.
Will Close: 07/26 (today)
Assignment Fee: $2500
Pros: House is in top shape. Needs only kitchen sink, some cabinet doors, new garage doors and a tenant
Cons: None
Challenge: Making sure seller puts up a furnace and hot water tank per our agreement before closing today.
Second House
Seller: Out of State investor.
Reason for selling: I actually got this call at about 1:05am. I decided to listen to the voice message and it sounded like a very motivated seller, so I called him right back and it turned out to be a deal. Seller has several other houses with tenant, but one of his vacant houses got broken into and everything was stolen (copper plumbing, furnace, Hot water tank, kitchen Cabinets, toilet, sink….you get the picture) Only thing left is the brick structure, excellent roof, walls and floors. Did a walk through with his property manager and my contractor, who estimated the repairs as $5K- $7K.
Got a signed contract: 7/24
Still gathering information before marketing to my buyers this week.
Projected Assignment fee: $4K
Pros: Very cheap. Great neighborhood. Buyer will have a chance to decorate a clean canvas however he wants to.
Cons: 2 bedrooms, with lots of rehab work to be done.
Challenge: Finding a buyer willing to take on that much rehab work
Third, Fourth, Fifth and Sixth House
Seller: Retired long time Landlord
Reason for Seller: Retired and wants to move to Florida with wife. Landlord owns 4 properties with mostly good long time paying tenants. We drove around his properties and it was obvious he takes very good care of them and gets along with his tenants. We stopped by a Coney Island to sign the contracts and get some lunch together after the hour long walkthrough of all 4 houses. The husband insisted on paying, but I told him it was going to be a tax write off and he handed me the receipt, lol.
Got signed contracts – 7/24
Sent property information to my buyers – Sunday 7/25
Already gaining interest, 2 of my buyers called to get more information and will drive by the houses tomorrow.
Projected Assignment Fee for all 4 houses: $30K (as a package deal)
Pros: Turn Key properties with good long time paying tenants. About $9600/year cashflow per house = $38,400/year for all 4 houses.
Cons: Can’t think of any major cons.
Challenge: Selling all four (2 family units) as a package deal.
I sent out my second set of postcards for the month last week Tuesday and already have over 50 calls. I’m still getting calls from the previous marketing, but it’s slowed down quite a bit. I was scheduled to have 3 closings last week, but for one reason or the other (which I’ll be blogging about next time) they were postponed to this week, so I’ll be having 2 closings today and another later this week. Two from previous marketing efforts and another from the above marketing.
One thing I will change from this marketing will be sending out the postcards on Thursdays as opposed to Tuesdays, So I get my first call on Monday and spend the whole week returning calls. Also, I’ve learned how to filter through the calls, so as not to waste time with sellers looking for top dollar for their houses and only focus more on motivated callers. Other interesting things that happened from phone conversations was finding 2 cash buyers in the process, a property manager to partner with and meeting with someone I had a good conversation with, who is excited about being a birddog and a private investor if I decide i want one…go figure.
P.S: In my previous posting, I mentioned that I was going to record a video to show you some of the things I look for when I do a walkthrough of a property. Unfortunately, the recording didn’t turn out well so I’ll have to redo it. My buyer actually closed on the property last week Thursday, but since the seller is out of state, we had to email the documents to her and have her overnight it. So, we will be getting the closing documents back today. However, my buyer will not be working on the house this mid August and is perfectly fine with me recording another video in the house. I’ll find time out of my busy week to retape or choose another house. So stay tuned.
Don’t judge each day by the harvest you reap, but by the seeds you plant. ~Robert Louis Stevenson
Effort only fully releases its reward after a person refuses to quit. ~ Napoleon Hill
Wow!!! That’s awesome!!! Could you please send me a copy or post a copy of the postcard you send out? Thank you very much, Esi. How are the probates going?
Matt
Hey Matt, I got my postcard from a friend and I’ll ask her if it’s okay to share, but I don’t think she will have a problem with it. Probates is going well, but not as good as my postcard marketing.
Esi,
That would be awesome if you could share that postcard.
Thanks,
Aaron
I love your blog!! Thanks for sharing!
Thanks Aaron. Glad you like it.
Hey Esi!
The package of houses sounds like a great deal and I can’t imagine you’ll have a problem selling that (assuming its priced well). I see that the absentee owners with properties in Detroit are tryin’ to get outta dodge which means sweet sweet paydays for you all day every day! Go girl!
These are really terrific results from your direct mail! For those who are new or thinking about direct mail, I want to share that a 22% response rate on a postcard is waaaaaay above average. That is a SUPER response and better most (actually any) other investor I know who is using direct mail.
My only reason for mentioning this is because I don’t want people to be discouraged if their response rates are much lower. If you’re getting 10%, be really happy! If you’re getting 5%, you’re still solid! The key is that you want to get a solid ROI of your marketing dollars and one solid deal can pay for a lot of marketing!
This is also why consistency with direct mail is so important…gotta keep the flow of leads coming.
Shae´s last blog ..Book Review- Talent is Never Enough by John C Maxwell
Yes, I love package deals, but the challenge is finding a buyer willing to buy all of them. People are leaving, but there are buyers waiting to snatch those houses as investments. Thanks Shae for clearing that up about the response rate. I was pleasantly surprised with the percentage too. Half of the callers did not leave messages and most of those that left messages were looking for retail or were still living in 2006 when the prices were 6 figures. You are right about being consistent, some of the people I spoke with called after getting several of my postcards. Thanks again Shae for the insight.
Oh by the way…that dude was simply irritated. ANGRY is the seller who called Justin. LOL!
Shae´s last blog ..Book Review- Talent is Never Enough by John C Maxwell
He was definitely irritated. I hope I don’t get a call like the seller that called Justin, but it’s quite funny though.
Awesome information Esi. The stats in your post gives some good insight to your campaign and the results that you are getting. I found that a lot of people that don’t leave messages either was calling to see what your information was about or just didn’t want to leave a message. Calling back those hang ups can result in some good deals as well but that’s something you might want your VA to handle. 6 contracts form a little over 1000 mailers is some great results! Keep crushing it Esi!
You are right about the hang ups. I do call some hangups back, especially if they are out of state callers. I definitely need a local assistant to help me handle the call backs and maybe get a deal or 2 from those. It’s a great result, but I hope I can close on all of them, but we’ll see.
Wow- 22% response rate is amazing!
Sounds like you’ve found the sweet spot with your marketing piece AND and your list…
Keep up the great work, Esi!
Steph
Stephani´s last blog ..Steph Goes to the Beach
Thanks Steph, 22% response rate is amazing for sure and as Shae pointed out waaaaaay above average. Google Voice records all the calls even if the hangup was within a second of placing the call, so that might be why it’s so high. Or, I guess the competition is very low. Either way, I’m not complaining, lol.
22%!!! Wowee! Awesome job, Esi! And way to create some killer momentum with nice paydays on the other side. I love the enthusiasm and abundance-mindedness with which you’re approaching everything. You are TRULY a success story worth emulating for anyone who’s getting started in the biz. Folks..WATCH ESI…and MODEL HER.
Keep rocking, girl…
…jp
jp moses´s last blog ..Video- “Wholetale” Vs “Retail” Real Estate Deals- Part 2
Thanks JP for stopping by. You make a lady blush :”>
Wow Esi…! You are really putting in work in Detroit. You are so determined and that’s why you are reaping maximum benefits. Keep up the good work! Kat.
Thanks Kat. I spend all day obsessing over my business, so I might as well make some money while doing it, lol.
Wow, Esi…22%, that is awesome response rate. Fantastic!
Congrats to you!!
Steph
AnotherSteph´s last blog ..First Direct Mail Campaign – Part 2
Thanks Steph. 22% is wayyy over the top, but it’s great none the less. I was pleasantly surprised.
Congrats.
22%. If I don’t stop foaming at the mouth, my soul is going to leave my body.
The point I’m taking away from this post is the huge differences that can exist depending on the areas. I have a feeling that I will not get that kind of response rate where I am operating. Homeowners are not getting out of the area like in Detroit and because of the proximity to the New York City, it is still very competitive here. On the plus side, there are a lot rehabbers popping up and I try to get to know as much of them as I can.
In terms of marketing, I have been experimenting with my mailing campaign. Different size envelops, different letters, difference fonts, different slogans… I haven’t come up with a home-run formula yet. but still searching. Haven’t tried post cards yet. maybe I will try it next.
Keep up the good work.
Lol David. I know what you mean. The area definitely makes a difference. I’ve exploited other areas and didn’t get nearly as good a result as I’m doing with this new area. I do have New York buyers looking for rental properties in Detroit, I don’t blame them, cash flow is great here. I was very very hesitant with mailing postcards because letters were working so well for me, but I knew it didn’t make business sense to mail out over 1000 letters, stuff and attach stamps and return label, so I decided to experiment with postcard and I was shock how many call I got. Keep experimenting and once you get it right, you are golden.
Stuffing 1000 letters. Yep. done that too.
Unfortunately, We are not getting buyers from other areas or states, mostly rehabbers.
You got a good area, good letter/post card campaign, and feverish buyers from in and out of your state. Trifecta complete! Go Esi.
I’ll keep on experimenting like a mad scientist.
David
Excellent! Thank you for sharing Esi
Thanks Brent for stopping by.
Hi Esi,
This is the first time I have been to your blog.
I am delighted to read your posts and I am happy to find that there’s somebody here in the Metro Detroit Area that’s been doing this.
I am wholesaling too here in the area of Livonia. I just started Feb of 2009 and but I have not had the same success as you because I’ve gone to the route of making offers on foreclosure houses on the MLS.
We should meet one time and maybe we can help each other. I have 2 kids myself (4 and 2 yrs olds).
Thank you!
Maria
Hi Maria, thanks for stopping by and leaving a comment. I’m always happy to find other wholesalers in the Metro Detroit area and I would love to meet you too. I tried the MLS route and didn’t like it very much, but I know people that are doing very well using that route. Flipping moms rock!
Hello Esi:
Thanks so much for your information. I have been using the yellow letter marketing but have been mailing out only about 100 at a time. Based on what you are saying, I need to step up my game and mail a lot more. How many times do you mail to the same seller and how often? Are you manually writing the addresses on the postcards or are you using labels? I have been manually writing all addresses including the return address on the yellow letters. It seems like you send out over 1000 postcards at least twice a month. Is this correct?
I have been aggressively putting out bandit signs and have gotten a lot of responses, mostly from people who are upside down. It seems like the absentee owner is a more better use of my time since these are people who do not live in the property.
Any reason you use a contractor instead of estimating the repairs yourself? What’s in it for him?
In a previous post, you mentioned that you use RealQuest for getting those lists? Is there any other way to get a list of absentee owners? I believe that I can go to the courthouse which will take some time.
I have been fortunate to close on two deals ($8000 and $3000) in less than 3 months. I say “fortunate” because a lot of people don’t even close one deal. They give up because it is so difficult. I am not financially able to spend that much on marketing. Do you think this is holding me back?
Thanks so much for your response and any info would be highly appreciated.
Keep up doing the good work!
Wow Esi! Thank you for sharing! The stats in your blog are fantastic. It is always nice to be able to really track the return on investment of your marketing dollars. I have just downloaded my absentee owners list from tax records and am planning on having my mailing out next week. I am located in Orange County, CA. I would love a to see a sample of the postcard that has worked so well for you if you are able to share. Thank you again for sharing your experiences, I am hoping to do the same soon. Best, Brandi