Originally posted by @Robert Kriedermann:
Originally posted by @Ian Walsh:
Originally posted by @Robert Kriedermann:
Originally posted by @Ian Walsh:
Something seems really off here. There should be deals in there for sure. Are you looking to wholesale them if youre not flipping? 5% response on 16000 pieces is 800 calls. There are deals in there for sure. Something is missing here.
If the house isn't in an area that would be good for a flip (which 90% or more of the calls I have gotten are not good for flips even though I mail to all absentee owners within 45min-hour of me) I make an offer where I could wholesale the property by buying it with cash, and listing it on MLS to make a profit. It seems like deals would be in there but I talked to everyone and I'm not sure that there were. Maybe something is missing but I'm not sure what it is.
Ok, so you are in rental areas. Those should be able to be wholesaled for sure. Are you offering too much? What are the investors within 1/10th of a mile paying for properties there? How many have you put under contract? We used to wholesale a ton in those kinds of areas. They aren't life changing deals but if you do enough volume it adds up.
I am definitely not offering too much. I want to be very careful in those areas. Investors within 1/10th of a mile are paying $2,500 to $20,000. I'm getting calls from the D and D- neighborhoods. I didn't mail to the F neighborhoods. I make a lot of $2500 -$10k offers. I might offer $2,500 for a property in bad shape and $10k in good shape. I've put none under contract. The seller's don't bite on that because they can't believe that's what the comps are. It's possible I could get lucky and find some buyer to pay $30,000 for a house I offered $10k on so maybe I should have offered $20k but It's risky and I'm afraid to be stuck with a property in a war zone. I'm doing 3 rehabs in $300k areas right now so I don't need to be running around in warzone areas taking a lot of risk for not a big potential return. I'm going to scrub my list and take any property I know is in those areas out. I'm sure it will result in a much smaller call volume but at least I won't be chasing leads that aren't worth it.
As someone who has done direct mail in Milwaukee, there is definitely something amiss if you are sending out 16,000 pieces and getting that response rate and not getting deals. I can empathize with getting a lot of leads for not as desirable areas as the zip codes in North Milwaukee tend to overlap with decent areas/warzones.
If you are structuring your contract correctly, there should be no reason to fear getting stuck with a property in a warzone. If you're trying to wholesale, you can put it under contract and try to move it for 5 or 10 days while in the inspection period. I actually highly recommend you get in touch with Rebecca Holmes (not sure why it isn't linking her name) as she wholesales a lot of property in the areas of Milwaukee you are having issues with. At least you'll be able to split some deals to monetize those leads to subsidize your mail cost.
I'm also betting you have a solid 10 retail listing leads in that bunch that should be referred to a good real estate agent. If you don't know one, I can give you a referral for an awesome agent that closed several of these type of leads for me during my last campaign. Just another way to subsidize your marketing. When talking to sellers, you should be probing for motivation and distress. If there's motivation to sell but no distress, immediately switch on your retail listing hat, talk up your agent, and ask if you can have that agent call them.
If you do it right, I'm sure you can get close to your monthly marketing budget to allow you to continue your campaign and I promise, you WILL get deals. Stay consistent and good luck!
