Finding fix and flip deals, cold calling and other things

[Anthony Lynch]

Hi all. Wanted to see people’s opinions here. Always see great opinions and great advice on here and just wanted to see if people experience similar issues starting out looking for off market. My business partner and I have started to looking for deals for fixing and flipping sfh. Both of us have pretty good experience rehabbing from past properties and work. We’re looking for off market deals through various channels like sending out postcards, cold calling and networking with wholesalers. Nothing seems to be really working. We have been looking for the past 7 months. Cold calling, we must have went through over 3k leads from 2 areas on cold calls. Repeated postcard sending also. Wholesalers send deals but 20 other investors are bidding for smaller margins. Real estate agents are similar. What probably doesn’t help also is that we will be using hard money which eats into profits and so getting that better deal seems to be harder compared to investors that have cash. Wanted to see if others had this type of struggle initially searching for off market deals? Is it something that clicks after some time of trying? Also I’m looking in the Northern California region near concord area. Both of us still very driven to get our first deal but wanted to see if it is something people go through initially and when did they land their first deal. Thanks all in advance. 

[Jonathan Greene]

What do your postcards say? If you are sending generic marketing like most people trying off-market acquisition for the first time, it's probably going in the bin straight away.

When you say you went through 3k leads, what do you mean? What's your follow-up structure there? You don't get deals right away. It comes from building relationships with anyone who doesn't hang up on you.

What's your pitch to them? Are you pitching every seller the same way with a script or are you trying to get to know what their problem is so you can solve it? In 7 months, how many direct appointments have you gone on?

[Julie Muse]

@Jonathan Greene I totally agree with him. 

THe more appointments you go on the offers your make, the more offers you make the more deals in your pipeline. It's hard starting out to stay motivated when nothing seems to work.  I bet you are very close to your first deal.  The fortune is in the follow up. I bet you probably have a deal sitting in your pipeline. Jack of all trades, master on none. Here is my thoughts on that.  When we don't find success in a strategy we tend to move to another one.  Become brilliant at the basics, stick to one strategy and kill it. Then, once you have mastered that add something else to your tool belt. Your going to spin your wheels dealing with agents and wholesalers.  You have a true business when you know how to source leads. I don't use postcards anymore. I just am not seeing the return on investment.  I usually get PPC leads or work a motivated lead source such as pre foreclosures.  Also, don't knock driving for $'s. If you picked me up and put me in another location and I wanted to find a deal, that is what I would do first.  Good luck with everything and happy investing

[Anthony Lynch]

Quote from @Jonathan Greene:

What do your postcards say? If you are sending generic marketing like most people trying off-market acquisition for the first time, it's probably going in the bin straight away.

When you say you went through 3k leads, what do you mean? What's your follow-up structure there? You don't get deals right away. It comes from building relationships with anyone who doesn't hang up on you.

What's your pitch to them? Are you pitching every seller the same way with a script or are you trying to get to know what their problem is so you can solve it? In 7 months, how many direct appointments have you gone on?

Hey Jonathan. Thanks so much for responding. Your questions got me reflecting on some things that we're doing. And sorry, yeah I should explained each of the things better. As for the postcards, I listened to a BP podcast before where a person had success when the put a picture of an animal on front because the thought was people warmed to it better. Got a better hit rate for them. I tried something similar with a dog with a sign as if they would be interested in selling their property. Then back has the contact details and a little to explain about myself. I'm not sure if thats in line with what you think is generic? I wanted to try something different because I receive a lot of similar letters and postcards for all my properties, that doesnt catch my eye much.

For the cold calling, we use mojo dialer which has a built in crm and the power dialer. So when I say over 3k leads I mean that we have hit over 3k homes with owners. Now still going through that list to re-attempt them but around 1k of them were hard no's of people who owned the property and just not interested. I know its a numbers game but I would have thought at least 1 may have been interested.

As for the script. Usually its starts with "Hey is this John Doe", Or "are you the owner of property 123 main street". If they say yes, then it would be follow up with "Would you be interested in selling your property". We have tried playing with words here but hard to make it so its less invasive or impersonal. I have watched videos on callers, and they seem to follow a similar approach. But not sure if its entirely the right way. I guess the solving the problem is a good question you ask here. My naive thoughts here are that people are motivated to sell or not based on certain situations and its matter of striking the right person at the right time. I guess how you handle the person by building a relationship is key here. To add we have had 2 people that entertained the call. Asking us what we would offer. We tried pulling a number from them but they refused to give us one. We eventually gave a number and they then gave a number way over market price even. Tried to call out to their property but they just wanted an offer over the phone. Do you have any suggestions with how you would tackle the pitching? Would you do things differently? 

Also to answer your last, we have gone to appointments set by wholesalers/agents but not cold calling yet. We have made offers on many. Nothing sticking yet. Definitely because of the higher bids.

@Julie Muse I love your quote on jack of all trades. I was beginning to think if we should pivot to something else from cold calling. But I think patience for me is key here in that I need to stick at it and continue on the follow up process. I am on the same thoughts of agents and wholesalers. Driving for $'s is something I havent done yet. I have a company that I run during the week that eats on time, thats why cold calling is easier to spare an hour a day to tackle it. Same with my partner. But weekends I need to start doing that as well

[Jonathan Greene]

@Anthony Lynch the dog is a gimmick. If you really sit down and think about it, is someone who wants to sell their house going to look at that and think it's not a gimmick for them to turn it over? Gimmicks don't work, building connections do and it starts with how you reach out.

Your script is also too generic. What list are you using that makes you think a person wants you to ask them if they are interested in selling their property? That's like calling a list of singles and asking if they would like to get married. Who are you and why are you asking? You haven't even introduced yourself in your script before you ask them if they want to sell to you.

That's why Mojo doesn't work, it's a cattle call. You have to have your number ready, but I would never give a seller a number. I would say the automated values says X. What do you think about that? Have you done any work to the home?

You seem like you can do well in this, but what you are doing now is just what anyone would do so it holds no value. You aren't doing anything different than anyone else so why would you get results. If you are calling an area you live in, you always lead with that, "I am a local homebuyer/wholesaler and live only a few blocks away, went to this high school, etc."

[Jacob Sherman]

There are so many opportunities on market that are open for negotiation . I would connect with a local realtor 

[Gustavo Munoz Castro]

Quote from @Anthony Lynch:

Quote from @Jonathan Greene:

What do your postcards say? If you are sending generic marketing like most people trying off-market acquisition for the first time, it's probably going in the bin straight away.

When you say you went through 3k leads, what do you mean? What's your follow-up structure there? You don't get deals right away. It comes from building relationships with anyone who doesn't hang up on you.

What's your pitch to them? Are you pitching every seller the same way with a script or are you trying to get to know what their problem is so you can solve it? In 7 months, how many direct appointments have you gone on?

Hey Jonathan. Thanks so much for responding. Your questions got me reflecting on some things that we're doing. And sorry, yeah I should explained each of the things better. As for the postcards, I listened to a BP podcast before where a person had success when the put a picture of an animal on front because the thought was people warmed to it better. Got a better hit rate for them. I tried something similar with a dog with a sign as if they would be interested in selling their property. Then back has the contact details and a little to explain about myself. I'm not sure if thats in line with what you think is generic? I wanted to try something different because I receive a lot of similar letters and postcards for all my properties, that doesnt catch my eye much.

For the cold calling, we use mojo dialer which has a built in crm and the power dialer. So when I say over 3k leads I mean that we have hit over 3k homes with owners. Now still going through that list to re-attempt them but around 1k of them were hard no's of people who owned the property and just not interested. I know its a numbers game but I would have thought at least 1 may have been interested.

As for the script. Usually its starts with "Hey is this John Doe", Or "are you the owner of property 123 main street". If they say yes, then it would be follow up with "Would you be interested in selling your property". We have tried playing with words here but hard to make it so its less invasive or impersonal. I have watched videos on callers, and they seem to follow a similar approach. But not sure if its entirely the right way. I guess the solving the problem is a good question you ask here. My naive thoughts here are that people are motivated to sell or not based on certain situations and its matter of striking the right person at the right time. I guess how you handle the person by building a relationship is key here. To add we have had 2 people that entertained the call. Asking us what we would offer. We tried pulling a number from them but they refused to give us one. We eventually gave a number and they then gave a number way over market price even. Tried to call out to their property but they just wanted an offer over the phone. Do you have any suggestions with how you would tackle the pitching? Would you do things differently? 

Also to answer your last, we have gone to appointments set by wholesalers/agents but not cold calling yet. We have made offers on many. Nothing sticking yet. Definitely because of the higher bids.

@Julie Muse I love your quote on jack of all trades. I was beginning to think if we should pivot to something else from cold calling. But I think patience for me is key here in that I need to stick at it and continue on the follow up process. I am on the same thoughts of agents and wholesalers. Driving for $'s is something I havent done yet. I have a company that I run during the week that eats on time, thats why cold calling is easier to spare an hour a day to tackle it. Same with my partner. But weekends I need to start doing that as well

 I run a call center for real estate and we do a lot of calling for investors. Let me try to "debug" whats going on here. What kind of list are you calling? If you were calling the phone book, normally 1 our of 30-50 people will say they at least have SOME interest in selling their home (usually a retail sale). If you have 3K number you've dialed and just two people were somewhat interested my guess is that you're doing it wrong. That's also not a ton of numbers to dial on Mojo, that would probably take you a week or two to call through, maybe 30 days if doing only a couple hours per day. What have you been doing the other 6 months? You need to be calling and refining your pitch. It actually IS as simple as calling them and asking if they would like to sell, but you need to say it better than that. Generally: 

1) you need to call a list of LIKELY motivated sellers like high equity, seller/property of a certain age, inside your buy box, notice of default/liens/etc. 

2) You need to make an enticing pitch, "Hi Mr Seller, I'm Gus and I work at ABC Solutions, a local family owned business that helps sellers get cash fast for their homes, would you be interested in an all-cash offer for your home? As is condition? close in 7 days?". Try to avoid giving them a number over the phone, try to get your foot in the door and take a look at the property first.

3) Follow up. Most folks won't convert right off the bat. Even the 2 you spoke to you should call back in 30 days, hell even the 1K that said no you should call back in a few months (unless they requested to be removed from your list), if the list is worth it. Its a follow-up game, some sellers take weeks/months to convert. Follow-up monthly with your list of potential sellers.

HTH

[Anthony Lynch]

Quote from @Jonathan Greene:

@Anthony Lynch the dog is a gimmick. If you really sit down and think about it, is someone who wants to sell their house going to look at that and think it's not a gimmick for them to turn it over? Gimmicks don't work, building connections do and it starts with how you reach out.

Your script is also too generic. What list are you using that makes you think a person wants you to ask them if they are interested in selling their property? That's like calling a list of singles and asking if they would like to get married. Who are you and why are you asking? You haven't even introduced yourself in your script before you ask them if they want to sell to you.

That's why Mojo doesn't work, it's a cattle call. You have to have your number ready, but I would never give a seller a number. I would say the automated values says X. What do you think about that? Have you done any work to the home?

You seem like you can do well in this, but what you are doing now is just what anyone would do so it holds no value. You aren't doing anything different than anyone else so why would you get results. If you are calling an area you live in, you always lead with that, "I am a local homebuyer/wholesaler and live only a few blocks away, went to this high school, etc."

Yeah you make some really valid points. Love the feedback. I have reviewed my script and switched it up to be more relational rather than transactional. I definitely see you point on that. Thanks so much.

@Gustavo Munoz Castro Also some great feedback here also. Our follow up game is somewhere that we're weak on as well. Need to get a better system here to keep on track of this. I guess I didnt think that people would not be interested later but If you developed more of a relation I guess that changes.

[Julie Muse]

Quote from @Anthony Lynch:

Quote from @Jonathan Greene:

What do your postcards say? If you are sending generic marketing like most people trying off-market acquisition for the first time, it's probably going in the bin straight away.

When you say you went through 3k leads, what do you mean? What's your follow-up structure there? You don't get deals right away. It comes from building relationships with anyone who doesn't hang up on you.

What's your pitch to them? Are you pitching every seller the same way with a script or are you trying to get to know what their problem is so you can solve it? In 7 months, how many direct appointments have you gone on?

Hey Jonathan. Thanks so much for responding. Your questions got me reflecting on some things that we're doing. And sorry, yeah I should explained each of the things better. As for the postcards, I listened to a BP podcast before where a person had success when the put a picture of an animal on front because the thought was people warmed to it better. Got a better hit rate for them. I tried something similar with a dog with a sign as if they would be interested in selling their property. Then back has the contact details and a little to explain about myself. I'm not sure if thats in line with what you think is generic? I wanted to try something different because I receive a lot of similar letters and postcards for all my properties, that doesnt catch my eye much.

For the cold calling, we use mojo dialer which has a built in crm and the power dialer. So when I say over 3k leads I mean that we have hit over 3k homes with owners. Now still going through that list to re-attempt them but around 1k of them were hard no's of people who owned the property and just not interested. I know its a numbers game but I would have thought at least 1 may have been interested.

As for the script. Usually its starts with "Hey is this John Doe", Or "are you the owner of property 123 main street". If they say yes, then it would be follow up with "Would you be interested in selling your property". We have tried playing with words here but hard to make it so its less invasive or impersonal. I have watched videos on callers, and they seem to follow a similar approach. But not sure if its entirely the right way. I guess the solving the problem is a good question you ask here. My naive thoughts here are that people are motivated to sell or not based on certain situations and its matter of striking the right person at the right time. I guess how you handle the person by building a relationship is key here. To add we have had 2 people that entertained the call. Asking us what we would offer. We tried pulling a number from them but they refused to give us one. We eventually gave a number and they then gave a number way over market price even. Tried to call out to their property but they just wanted an offer over the phone. Do you have any suggestions with how you would tackle the pitching? Would you do things differently? 

Also to answer your last, we have gone to appointments set by wholesalers/agents but not cold calling yet. We have made offers on many. Nothing sticking yet. Definitely because of the higher bids.

@Julie Muse I love your quote on jack of all trades. I was beginning to think if we should pivot to something else from cold calling. But I think patience for me is key here in that I need to stick at it and continue on the follow up process. I am on the same thoughts of agents and wholesalers. Driving for $'s is something I havent done yet. I have a company that I run during the week that eats on time, thats why cold calling is easier to spare an hour a day to tackle it. Same with my partner. But weekends I need to start doing that as well

 Awesome, youve got to let us know when you get your first house under contract next week

[Corby Goade]

There's huge competition in wholesaling everywhere- sometimes hundreds of people in every market calling the same lists. That compresses margins, so you need to either be willing to operate with smaller margins and more risk or find leads that others aren't working. 

I'm an agent, but I work with lots of wholesalers- I work with the escrow agents who manage all of my deals to get my clients lists that are more specific and not public record. That helps for sure. 

[Mike Klarman]

The property funnel can be a challenge. Some markets are too competitive for the MLS to work numbers wise so you need that direct seller/wholesaler relationship.

I built an investment network in Pitt over the last 18 months.  My clients have closed on 30 or more deals there.  I can tell you what worked for me there.  First, find yourself an investor/agent.  They are out there.  They can come from both angles and if they are an investor then they get their properties from somewhere.  Plus an investor/agent knows and understands the numbers, they can estimate rehabs more accurately as well.  The truth of it is you are nothing to an agent/wholesaler until you close one with them.  The second a sound investment popped up, one of my clients made an offer, it was accepted and we closed in 4 weeks.  That agent was now on that purchase contract and he later sold the house about 4 months later and was on that sale.  He made two commissions during the lifecycle.  I would have morning calls with him and pump him up.  Tell him we cam do three of these per month if he can find the opportunity.  He started busting his butt not only looking for deals but out there hustling listings and then bringing them right to me.  I found a young, hungry, two-way agent that I closed a deal with early and showed him my group is for real and now we've closed at least 20 more deals together and he knows exactly what works and he knows Pitt street by street.  I kinda struck gold with him.  Very honest as well and very accommodating.

[Anthony Lynch]

Quote from @Corby Goade:

There's huge competition in wholesaling everywhere- sometimes hundreds of people in every market calling the same lists. That compresses margins, so you need to either be willing to operate with smaller margins and more risk or find leads that others aren't working. 

I'm an agent, but I work with lots of wholesalers- I work with the escrow agents who manage all of my deals to get my clients lists that are more specific and not public record. That helps for sure. 

Thats totally true. Margins seem to be getting tighter. I seen some investors do it for as little as 10% ROI in my market, which makes zero sense to me. Definitely like the approach through the escrow agents. Thats pretty solid angle.

[Anthony Lynch]

Quote from @Mike Klarman:

The property funnel can be a challenge. Some markets are too competitive for the MLS to work numbers wise so you need that direct seller/wholesaler relationship.

I built an investment network in Pitt over the last 18 months.  My clients have closed on 30 or more deals there.  I can tell you what worked for me there.  First, find yourself an investor/agent.  They are out there.  They can come from both angles and if they are an investor then they get their properties from somewhere.  Plus an investor/agent knows and understands the numbers, they can estimate rehabs more accurately as well.  The truth of it is you are nothing to an agent/wholesaler until you close one with them.  The second a sound investment popped up, one of my clients made an offer, it was accepted and we closed in 4 weeks.  That agent was now on that purchase contract and he later sold the house about 4 months later and was on that sale.  He made two commissions during the lifecycle.  I would have morning calls with him and pump him up.  Tell him we cam do three of these per month if he can find the opportunity.  He started busting his butt not only looking for deals but out there hustling listings and then bringing them right to me.  I found a young, hungry, two-way agent that I closed a deal with early and showed him my group is for real and now we've closed at least 20 more deals together and he knows exactly what works and he knows Pitt street by street.  I kinda struck gold with him.  Very honest as well and very accommodating.

 This is brilliant. The double sale approach is genius actually. Problem is as you said is finding that agent/investor. Most I have came across are just agents that dont understand the investor strategy of it. They also have a monopoly of people they can send deals to and can close in days. But there is definitely someone out there. I will keep networking hard to find.