Forum Replies Created
Hi Enigma,
Approaching owners directly is a great way to find well priced IPs and I have done it several times. I have the added advantage of being a real estate agent, so what comes naturally to me, I guess may not be that obvious to others. So I’ll let you in on a couple of trade secrets.
Usually only 3% of people are in ‘real estate mode’ at any given time, so if you are doing a mass flyer distribution then expect a 1-2% response rate.
A well known fact of direct marketers is that a personally addressed letter is 80% more likely to be read than an unaddressed letter (just think about the mail you get at home). Real estate agents use a subscription only database called RP Data but similar information is available to the public through either Dept of Natural Resources or your local council. So try and get owners names for your database.
Use a plain (no logo) window faced envelope as the mail will look official and has an even higher chance of being opened.
What is the main hot button for a private seller? Obviously they can avoid paying an agents commission. In many cases this may be around $10,000.
One word of caution – I would recommend not putting anything creative in your letter. ie. don’t say flexible terms, long settlement, lease-back, vendor finance or anything like that. These terms will freak most people out and they will think your are looking to do something dodgy. It’s fine to discuss these things face-to-face once you have met the seller.
Recently I ran a classified ad in the local newspaper that read: “Need a Qick Sale. Receive a cash offer within 48 hours. No real estate agent fees. Call me Today.”
Steve McKnight published a ‘Classified Ad Secrets’ CD years ago when he ran a wraps course. It’s got some of the best ad writing tips I have seen or heard, but I don’t know whether it is still available.
In 3 weeks I received over 20 calls and made 2 offers. I got one deal together which is a $300,000 purchase (approx market value $330,000) on a long settlement with a lease-back. Exit strategy is to do a quick reno and on-sell in summer when we can get a premium price due to the nice swimming pool. On the Gold Coast proeprties in this price range are currently rising, so we expect to achieve at least $360,000. In addition I have a JV partner who is funding it upfront on a 50/50 basis.
If you need any more help wording letters, just email me at [email protected] and I can email you a couple of letters that I have used. There is no perfect letter, but activity leads to results. Just have a go, you may be surpised what can happen!
Hope that helps. Good luck!
