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Updated over 7 years ago on . Most recent reply

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Joseph Weisenbloom
  • Investor
  • Austin, TX
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What are your driving for dollars ratios?

Joseph Weisenbloom
  • Investor
  • Austin, TX
Posted

I drove around my market area today and collected 50 addresses of houses that appear to be distressed or abandoned. My plan is to look up the names of the owners on county records and cold call them to see if they want to sell their house. I am looking to buy the house at a discount fix it up and rent it out so not interested in wholesaling.

I am a sales guy and I understand that this is a numbers game. My question is what are your typical close ratios for cold calling vacant houses. For example if I have 50 leads 20 of them wont have phone numbers. Out of remaining 30 leads 25 of the owners will tell me to kick rocks. 5  leads will result in 5 appointments made and 5 offers made. Out of those 5 I will get 1 accept my offer. Obviously these are hypothetical numbers. For all you BPers out there what is your close ratio? Do I need to get more addresses for my sales funnel?

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Rick H.#4 Marketing Your Property Contributor
  • Lender
  • Greater LA/Orange County area, CA
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Rick H.#4 Marketing Your Property Contributor
  • Lender
  • Greater LA/Orange County area, CA
Replied

Great logic. Mine is pretty high; higher than most people will believe, or course, I'm lazier than most anybody would ever guess!

Putting a number on unqualified leads will only discourage you because it may be way less than 1/100.  

Here are a few challenges to your approach:

Houses don't care what condition they are in and will deteriorate without assistance.

People who neglect their house's maintenance typically don't notice the problem on a day-to-day basis ("My roof doesn't leak when it doesn't rain"). Classic frog in a pan situation.

People who own (or are entitled to own) an apparently abandoned house are not usually concerned too much as to what happens to that house, at least at the moment.

So, your first challenge is to separate out the people who DO care from the people who don't. Unless and until you identify the catalyst which triggers a reason why they should care, you're working too hard to buy from unmotivated owners. And then you need to find the emotional reasons behind these and market with these real triggers in mind.

I see the conversion of owners into sellers and closing on those who are motivated as a process. People don't want to be manipulated, so your best strategy is to connect with them by mailing a series of letters, in sequence, that is informative. Give them a reason to call you other than just selling. Your are the info go-to guy. Get them to make an emotional investment by identifying with stories in your letters.

I would rather create my list and drill down to a small handful of people who have a "perfect storm" of problems: foreclosure, marital problems, adult children problems, big health issues, financial pressure, code enforcement citations; as many as you can find at one time. I prefer the guy who's head is about to explode to someone who "has to think about it". 

I want someone who is willing trade equity at a discount for peace of mind.  With MY list, my close ratio is well over 25% (I'm embarrassed to say how high). 

What sales close ratio do you make in your daytime job (selling widgets)?

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