I've mailed a little over 1,700 postcards so far in 3 different Virginia counties, and have yet to purchase any properties, so I'm just trying to figure out which part of my process I need to fix to be more successful in acquiring deals. To give insight into the leads these mailings have generated, I've probably received a total of 30-40 responses via voicemail or website submissions as a result of these mailings, and submitted 10 offers, all of which have either been rejected or ignored. I realize that this isn't a great response rate for the number of mailers sent out. I feel my offers have been pretty reasonable (by land investing standards) in the 20%-30% of market value range. However, for the most part, it seems like all of the leads I've been able to reach so far just don't have very high motivation to sell. A couple of additional details:
1) I've been using @retipsterseth postcard templates.
2) I've been pulling mailing data from AgentPro 247. It seems like VA keeps their counties updated, as information for most counties is updated monthly, so I don't think out of date data is a part of the problem.
3) I've been filtering lists primarily by absentee owners, and then choosing a target property size and/or assessed value, and mailing to everyone that fits the criteria.
Basically, I'm wondering if anyone sees any obvious flaws in my process that's preventing me from reaching more motivated sellers. Potential changes I'm wondering about are trying other Virginia counties or targeting somewhere out of state. I was also thinking about calling around to try getting access to some tax delinquent lists. I'm open to the possibility that I just need more reps (aka. just haven't sent enough mail yet to see results). Any thoughts or feedback is appreciated.
Try sending the next 1000 or two out using blind offers. Add dollars and cents to your offer, instead of $2100 offer make it 2132.48 or something like that..
Basically with the blind offer, the people that call you back are going to be the motivated sellers.
Also, try sending more than a few hundred per mailer. You need higher numbers of mail sent to get the kind of responses that produce. Typically the least you should be sending in 1 campaign is 1500, shoot for at least 2000 and best if 3000. There are lots of mailers being sent and you need to hit a lot of people to get a "yes, I'll sell you my land for pennies on the dollar" kind of response your looking for.
I heard the delinquent lists were more motivated sellers and they should require less mail to get a good response of sellers, but the delinquent lists are time consuming to gather, if you can gather them at all.
@hholladay - I do know some people who have been working on that side of the country over the past year (not with blind offers, but with neutral letters... similar to what you're doing). They found the response rate was pretty poor UNTIL they started getting very granular with their lists... and that's when it started working.
Of course, direct mail marketing is a very dynamic thing to figure out - what works in one place may not work in another... but it's something to chew on at least.
Also, to @jawollbrink's point - I'm actually doing something similar to his suggestion in a new market right now, and I'm sending out batches of 1,000 blind offers at a time to a very large list. My first batch of 1,000 was sent with very low offers for this market, and it didn't produce any results. On the next batch, I ratcheted up the offers by an additional $25 per acre, and I'll continue doing that until I find the sweet spot at which people start accepting at the acceptance rate I'm looking for.
When you're testing out new markets like this, it usually involves some "stabbing in the dark" to figure out what will get traction and what won't.
@hholladay I started my business doing deals in VA and have turned it into a full time income. I never had luck with postcards and have gotten all of my deals from one page letters. I've also had a few signed blind offers but there always ended up being major issues with the property. I've also gotten all of my lists directly from the county. My advice would be to spend a good amount of time making a list of counties that fit certain criteria (population density, proximity to a city, activity on zillow, etc.) then taking a day to call the treasurer's office of each county. For this part I pretty much made a script and asked the same questions each time I called. Sometimes I even requested to speak to the treasurer directly to explain exactly what I wanted. Some counties will be a total dead end, but most can give you what you're looking for if you do a good job explaining and are personable on the phone.
I also don't think it's necessary to send out 1500+ each time you mail, especially when you're just getting started and haven't made any income yet. For me, I was much more willing to spend time rather than money to give myself a better chance of finding my first deal. For example, my fiance` and I hand addressed our envelopes and used stamps and personalized return labels to get the highest open rate we could, which actually saved us a little bit of money, just took some extra time. It's also important to have good communication with your potential sellers. At the beginning, I was answering every call, even at night and on weekends, because I didn't want anything to slip away. I would have 10+ minute conversations with people even if I wasn't gonna buy their property. I think that helped with my confidence on the phone and has helped me close several deals since.
It's definitely tough when you've been putting a lot of effort in and still haven't found your first deal, but there are always areas for improvement and once you get over the hump there's a ton of potential for growth. I don't hand address envelopes anymore and I route all calls straight to my voicemail and return them at my convenience, but I think doing all that dirty work in the beginning was worth it. Good luck!
@tjcooley I totally agree with your approach. I often hear, send more mail, get more deals. I agree that this works. However, I am starting with very little cash and would rather put in the work to make my dollars more effective early on. My personal preference is to snowball this business with little to no debt. Eventually I will be comfortable spending the money on sending 1,000s of mailers from data service lists, but for now I am bootstrapping it with DTLs.
Starting out a few months ago, I called about 10-12 counties in my area and was able to get a delinquent tax list from 3 of them (2 of them just gave me the list for free). Between the 3 counties, I mailed about 700 post cards. I used different wording on the postcards for each county. I received about 20 calls/submissions on my website and 3 accepted offers. Surprisingly, the county I sent only 75 postcards to offered the most leads. It is a touristy area and had a lot more out-of-town owners. I made sure my flyers made a complimentary statement about their property ("your property in Some County has POTENTIAL! I'll offer you CASH for it!"). I think it makes the owner think they are sitting on a gold mine and entices them to call. Also, I made sure to explain that it doesn't take anything but a few minutes to see what I have to offer them, with no obligation.
The data was very different from each county, and it took a lot of time to interpret the data and manipulate it to find the addresses I wanted. My excel skills paid off tremendously here. @hholladay The moral of my story is tax delinquent data seems to be more affective, and the owners are more motivated to sell. In my mind, if you're strapped for cash, give it a shot. If you need help manipulating the data, let me know. Good luck!
Thanks for all of the great advice and insights. This gives me plenty of actionable steps to move forward with. I'll be trying several of these suggestions and hope to have some better success.
@tjcooley That's great to hear that you had success in Virginia. That just validates for me that it can be done and I just need to refine my process.
@TylerD Thanks for the offer. I definitely may reach out if I obtain any lists that are difficult to organize.
@retipsterseth As you increase your offers with each mailer until you get the desired response, are you sending it to the same previous addresses? Or, different addresses from the same list?
@bridget - in this case, I'm sending them to different addresses from the same list (it's a really big list), I'm not hitting the same ones multiple times with higher and higher offers.
@sunrise_buyers My concern with blind offers is that the County delinquent tax list doesnt always identify a property value. It may only show back due taxes, which can sometimes help determine a market value but this seeems risky to me. Postcards do add some extra steps, but it allows me to evaluate the property's value before making an offer. Perhaps I'm missing something with the blind offer process, so if you can shed some light on how to price from a DLT, i'd appreciate it.😊
I have received some DLTs that have the assessed value, which I may try blind offers on if I can get a reasonable correlation between the countys assessed value and the market value.
For that reason you can check the comps in the target area, i. E. a zip area, comparing the sold to the assessed values. Build the median and the ratio of MV to AV. That can then be used as multiplier for the assessed value of your targeted properties. If your area is available in Redfin, you get the APN's and the assessed values directly without the need to check them at the county site.
@tylerd Check Zillow for comps. You can also get comps from a title company. If you dig deep enough into county records you will also find what the owner paid and what the previous investor paid (if the county discloses the AOPV).