My Goals to Achieve by April 1st, 2012.


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  • Dear Jackie and my CashflowDepot accountability partners,

    I guess i’m a little late to the goal posting train, but my wife and i were in the process of making some decisions that directly affect both the nature of my goals and the level of my motivation in achieving them. After being a two income family for over 8 years and through the birth of three children, we have decided that my wife is going to quit work and stay home with the children and that we will likely try to have our fourth child sometime this year.

    She is a teacher and made around $45,000 this last year. My goal is to put back one year of her salary in cash before we receive her last paycheck on the last day of June, and half of that by April 1st, 2012. Following that, my goal is to replace her salary with passive income before the 2012 year is out. Effectively, i don’t want to feel the loss of her income on the family budget.

    I think i have all the tools in place to do what needs to be done. I’d like a little help generating a marketing plan and fine tuning it to meet the goals above.

    My area has a median income of just over $60,000, and a median home price of $110,000. Here are the tools i can bring to the table right now.

    I have access to the real MLS in my area, something which is not available via an “affiliate membership”. I can get expired listing, comps, etc. I also generated from this MLS access a spread sheet with the name, email and phone number of every Real Estate Agent who belongs to the local MLS, over 600 i think. I don’t have any plans to spam their email, but i’d like to be able utilize this list as much as possible, so i’m open to ideas on how to capitalize on it.

    I have the entire tax roll of single family houses in my county. Included on this spread sheet are the tax value, the square footage, the year built, number of stories, exterior wall material, type of heat/air, beds and baths (for maybe 20%), acreage, last qualified sale date price and method (if no qualified sale then the last sale date period), the last time the property had any kind of change in title (such as transfer from husband to wife with no actual sale), owner name and mailing address, etc…basically anything that can be known about the property from the tax website, for the 45,000 single family homes in my county.

    I’ve been investing for about 8 years and have around 30 properties in various stages of rental, lease option, and owner financing, and I control/own them through a variety of means including personally signed bank financing, sub2, and owner financing.

    Last year i wholesaled 3 houses for cash (doing simultaneous/double closings with profit of around $21,000 total) and one duplex (bought, for 35k, and sold, for 50k, on owner financing) without doing any active marketing other than google pay per click advertising and the magnet signs on my truck.

    I still have around 400 “We Buy Houses” bandit signs.

    I have a workhorse of a lazer printer and enough pink card stock to send out around 5,000-8,000 postcards.

    I have a bookeeper who handles all the mail and the rent payments and a sales person who is working part time on commission to get my vacant houses occupied (currently 4).

    I’m training in the mornings for an Ironman triathlon taking place in Louisville, Kentucky on August 26th, and i work at an engineering job from 7AM till around 4PM each weekday. I can work on real estate and answer the phone a little during the day, but the bulk of my available real estate business time is going to be after 4PM

    Now that you have a fair picture of where i’m at and the nature of my goals, can you help me focus the tools i have to better break things down into more refined monthly/weekly activities and targets?

    HI Christopher

    You can do it!

    Wholesale deals or Options/Highest Bidder Sales will be the quickest way to generate the $45,000 to replace your wife’s income.

    Just because your wife will become a stay-at home Mom does not mean she can’t help too. I was a stay-at-home Mom for the 12 years before I started in real estate so I know that “gig” all too well.

    She can help with target marketing to old deed dates in the cheaper neighborhoods – those will be ideal.

    What really took my biz to the next level in 1996 was to recruit all the stay-at-home Moms from the Mother’s Day out program at our church. Every Tuesday, they were my Army of property locators out looking for old, run down, vacant houses. They would supply an address only. If I closed on the deal, they got $500

    If your wife got those addresses, she could look up the owner in the tax records and send a postcard or hand written letter.

    Your best deals will NOT be listed properties. So the MLS may be useful for checking comps but it will not help much with actually buying properties. Expired listings are usually expired because they were priced too high and unrealistic about lowering their price.

    Keep us posted on your progress here!

    Best of Success
    Jackie

    Wednesday February 8
    Update

    WHAT I HAVE DONE

    Local Foreclosure Auction
    I took my lawn chair to the foreclosure auction at the county courthouse yesterday and met a few new people who were there to check out the process and to try and buy one of the houses. With the exception of one guy i knew already who is a rehabber, all the people there are what i would call noobs/newbies/rookies etc. I’ve decided to commit to taking 1 day off per month to go and set up camp at the foreclosure auction. If I meet only 3 new people per month there, that will be, ideally, 36 cash buyers more than i have at the end of the year that i don’t have now. As i’m writing this, i’m sitting here wondering if the numbers of new buyers i will get from this is actually worth my time…

    Continue Organizing Investor Lunch
    Our local REIA group has been very thin in the last couple of years, so to take up the slack i’ve been organizing our local investors who are still in the game to meet every Friday for lunch at the chinese buffet. I’m going to be adding these people i met to my wholesale buyers lists and sending them email notices for the Friday lunch.

    The rehabber, who bought one property, talked to me after he closed the transaction and asked me if i could wholesale it for him. I said probably, it depends on what kind of condition it is in. We may end up working together on some of the stuff he buys. He really enjoys coming to the auctions and buying junkers, we both know how to manage a rehab, and i love managing the wholesale/lease option selling process. So there is some good opportunity for both of use there.

    New Websites
    My websites went down last week, and i didn’t know it until Monday. They were a package i bought a license to use and agreed to pay $75 a month for hosting for about $3,500 in 2006 for a buy website and sell website and backoffice suite. So the “guru” I bought them from, Kris Kirschner anyone?, has aparently not been paying the hosting bill for over 2 years. Go figure. So i got a new website installed and working, though i don’t have all the kinks worked out yet.

    The new websites, which i own and cost significantly less than $1,000, incorporate squeeze pages, email auto responders, facebook, twitter, and I have separate sites for buying, selling, and wholesaling. So, ultimately, i think the website snafu will be a positive thing because it’s forcing me to focus more on social media marketing and i’m very excited about the auto responders.

    Worked on Filling Vacancies
    I working very hard right now to get my 4 vacant properties occupied. 3 will most likely go section 8, as they have in the past. The 4th is in a better area and i am hoping for a solid lease option buyer with around $5,000 down.

    I received notices from 3 additional tenants that they will be vacating in the next 60 days. So i’m feeling a great deal of pressure right now to get the current four occupied as soon as possible because 7 vacancies at the same time might really starting burning through my available cash at an alarming rate.

    WHAT I’M GOING TO DO IN THE NEXT 7 DAYS

    MARKETING
    I am currently spending around $30-$40 a month on google ad words advertising, and i am considering increasing that budget to $100-$150. I have gotten at least 2 deals from google adword in the last year i think. I’ll need to check on this.

    For wholesale/option deals i am going to begin by putting up some signs out side of city limits (to avoid my local code enforcement nazi’s) in more or less permanent locations (HIGH on telephone poles) so they stay up a long time. There are at least two other investors in my area who have put out bandit signs in the last 4-6 weeks. I don’t know what kind of response they are getting but they have put them up more than once. I know bandit signs bring in a lot of junk, but i have 400 of them sitting in my garage collecting dust. They sure aren’t going to bring me any deals sitting on a shelf. I’m looking at buying this thing called the sign sledge to make it super easy to put them up high on telephone poles…

    signsledge.com

    Next on the wholesale marketing list is going to be processing the data i have from my local tax assessor i am going to narrow down the list to those properties that have not sold in 12+ years, have 3 bedrooms, 2 baths, a garage and an after repair value of around $125,000-$150,000, the median home price in my city/county. For these addresses i’m going to send a 4.25×5.5″ bright pink cardstock post card that simply says, “we buy houses”. The buyers who need all cash i will focus on wholesaling to rehabbers. Those who see the benefits of offering owner financing to me ;) i will work on keeping and possibly splitting the deal with another investor who puts up the cash. These will be my deals for cash flow.

    I’ll also use the same criteria as above, just with a slightly lower price range, maybe $60,000-$90,000, and possibly only a carport or none at all. These I will focus on wholesaling to rental investors, and again, if the sellers will finance, i’ll try to go in with another investor who puts up the cash so we can split the deal, if it’s in a neighborhood that will likely still be good in 15 years.

    THOUGHTS FOR/FROM THE GROUP?

    Is it worth my time to go to the local foreclosure auction if there are only going to be 2-4 people there each month?

    Do you use email auto responders like aweber or built in auto responders with Sellers, lease option buyers, wholesale buyers, and/or private investors?

    What are people using RIGHT NOW that has been very effective in selling/renting their vacant properties?

    Is anyone here using bandit signs right now?

    Any thoughts or comments on anything i’ve written above.

    A lot of the “big name young guys who got heavily in to internet marketing REI products/web sites are not OUT OF BUSINESS and some even have the FTC chasing them. I’ve seen stats that 80% of them out out of business.

    Note that any time you spend on social marketing is a total waste of time. Just because a web site comes with a lot of bells and whistles does not mean it is a GOOD web site. More friends on your facebook does not = more buyers for your properties. It’s not a contest.

    I can tell you from personal experience that auto responders is a big BIG mistake with sellers and buyers leads from a web site. They need a phone call, not an email. (another thing that some web site people push as a + with their products when in fact it is a big negative). The minute they get that autoresponder is the minute they know you don’t really care and they will look elsewhere for a solution. I used to have autoresponders tied to all my web sites and I turned it off.

    Sellers and Buyers will dump you like a hot potato if they get autoresponder messages from you. You will burn that bridge fast.

    And it’s illegal to put signs on telephone poles. I know other people do it but it is against the law.
    I know for a fact that some sellers know this and will think… gosh, if that guy will break that law what other laws is he/she willing to break?
    bandit signs are NOT targeted marketing so you’ll waste time talking to a lot of people who want full price and all cash.

    targeted markting is much better than signs

    If it’s just newbies at the foreclosure auction then it’s a waste of your time.

    to sell/ rent, use craigslist & signs sign signs & an open house!

    UPDATE:
    I stopped by the city offices today after work to do two things.

    First thing i did was request a list of the houses with code violations. I have tried to do this over the phone with zero success. Our city office handles it like this. A call comes in and the Code Enforcement Secretary, CES, takes down the caller information and address of the complaint on a paper form. The CES then looks up the address and writes down the owner information and prints out a map of the property and staples that to the form. Then she hands that to the code enforcement officer, CEO. The code enforcement officer was not there, but the CES was very nice and asked me to call back or just come in when the CEO was in. I think i’d like to keep the face-to-face meeting trend going, so my plan is to just call him tomorrow morning and see when a good time would be to come in and meet with him. I’ll need to come up with a good reason that i need to see him in person…

    The second thing i was after was a dead meter list, so i went across the hall to the city water/gas office. I got with the right person, and after she talked to her supervisor, she said they could run the report i was looking for, but because it would include people’s names, i would have to do an open records request for the information. They should be calling me in the next day or so to get that list picked up.

    Note that any time you spend on social marketing is a total waste of time. Just because a web site comes with a lot of bells and whistles does not mean it is a GOOD web site. More friends on your facebook does not = more buyers for your properties. It’s not a contest.

    I think the social media aspect of it was to get higher in the search rankings, i think that having your company name show up on facebook and twitter, with some frequency, helps in search engine rankings. But i’m not married to what i have so far. Is there another website product/company you would recommend?

    [quote]I can tell you from personal experience that auto responders is a big BIG mistake with sellers and buyers leads from a web site. They need a phone call, not an email. (another thing that some web site people push as a + with their products when in fact it is a big negative). The minute they get that autoresponder is the minute they know you don’t really care and they will look elsewhere for a solution. I used to have autoresponders tied to all my web sites and I turned it off.

    Sellers and Buyers will dump you like a hot potato if they get autoresponder messages from you. You will burn that bridge fast. [/quote]

    This is very surprising to hear, really. Almost all of the seller leads i get on my website get a call from me. My sellers who calls my local area code advertised phone number (XXX_XXX_SELL) get a quick recorded greeting that tells them they can press 99 at any time during the message to be connected to a live operator, then goes on to explain in general terms how the process of buying the home works. If they dial 99 it goes directly to my cell phone.

    For the internet leads, i assumed that a simply thank you email 5 minutes after their submission would be a good way to keep them warm. After i spoke to them on the phone and either round filed the lead or scheduled an appointment i assumed that sending emails would be a good thing. I wouldn’t be doing it in leiu of a phone call, simply as a way to keep my company fresh in their minds. I assumed that them getting an email after 1, 2, 3, 5 days or so just hitting them with little reminders or tidbits about selling their home quickly would be a positive, not negative, thing.

    Now with Buyers, and when i say buyers i mean retail or lease option buyers, i can’t see the real harm in sending them emails at all. Our buying system kind of mirror’s what Jack Miller taught in his management seminars years ago. I haven’t been to a Tilney seminar yet, mostly because he hasn’t had one near me, but he may do the same thing…

    Basically, the motivated buyer sees a directional arrow street sign, craigslist ad, or anything else with a our branded phone number (XXX-XXX-HOME) a website(myareahomesellers.com), and a directional arrow. From their they can either try to follow the arrow signs to the house, call the number, or go to the website. The phone number is a recorded message that tells how our buying/renting programs work, and gives a list of homes available, and then gives features and directions to each home on separate extensions. They are instructed that if they want further information, they need to go to the house and cal lhte number on the sign on the front door. All this is designed to cut down on having to answer the same questions about the house (BR, BA, SF) 45 different times a day. Once they get to the house, the number on the front door connects them directly to a girl i have who answers the phone, gets some basic information, and give them the lockbox code. She follows up with them, encourages them to pick up an application and generally, to take the next step. For these kinds of buyer leads, why are autoresponders bad?

    Now with wholesale houses, i put a sign in the yard and an ad on craigslist with my direct number on it. There is no recorded message other than my cell phone voicemail if i cant get to the phone fast enough. If they are a serious buyer i get their name, phone number and email and add it to my buyer list. I send them to the house and try to get a contract, earnest money, and get them to the closing table asap.

    When you have a house for sale, do you answer the phone directly, without them going to any kind fo voicemail to hear info about the house?

    [quote]
    And it’s illegal to put signs on telephone poles. I know other people do it but it is against the law. I know for a fact that some sellers know this and will think… gosh, if that guy will break that law what other laws is he/she willing to break? [/quote]

    I’ve never thought about it like that and you raise a good ethical point…

    [quote]bandit signs are NOT targeted marketing so you’ll waste time talking to a lot of people who want full price and all cash.

    targeted markting is much better than signs
    [/quote]

    I agree wholeheartedly. Given your opinion on signs, do you do any kind of bandit signs to attract motivated sellers at all? What whould i do with the 400 or so signs i have in my garage, just throw them out or use the back of them for handwritten signs on wholesale houses?

    [quote]
    If it’s just newbies at the foreclosure auction then it’s a waste of your time.
    [/quote]

    I agree. Hopefully there will be some more players as the weather gets better down here…

    [quote]to sell/ rent, use craigslist & signs sign signs & an open house! [/quote]

    We are big on the signs and craigslist on my selling side. I have two questinos for you on this topic.

    1 – What do your signs look like for selling houses? Mine say No Banks Needed, Owner will Finance XXX-XXX-HOME, mylocalareahomesellers.com.

    2 – In the last several months i have had trouble with my lease option and owner finance ads being ghosted. Are you familiar with this term? It is distinctly different from having your ad flagged. If another craigslist user sees your ad, it can be flagged for spam, objectinoable content, over posting, etc. I that happens, you actually get a notification on your craigslist account that says “Flagged” next to the ad in your craigslist account home page.

    Ghosting is when you place an ad, craigslist says it is approved, you can go to the link the send you in the “youad is now live” email. HOWEVER, when you navigate to the category in which you ad should be listed, it does not appear in the list. It is an automated process that if your ad copy triggers the right key words, .com, phrases etc, it will simply be ghosted, never to appear in the search results or listings, and you will never know unless you go back to check on it.

    Have you ever had a problem with Ghosting that you know of?

    [/quote]

    Actually an instant thank you is 10,000 times better than a thank you 5 minutes later.

    When you’re dealing with a motivated seller, the only autoresponder needs to be a call from you. These folks want personal attention and that’s who they will sell their house to. I’ve tested this for 16+ years and I know from experience that an auto responder email series to motivated sellers is a huge mistake.

    When a buyer is ready to buy, they will look for something they can get within 30 days. Your email message 3,6 12 months later won’t do any good. What you need to do is pick up the phone, find out what they want, then go get it as fast as you can. You simply cannot put this kind of stuff on auto pilot.

    The BOUNCE rate is about 80% if you send people to a pre-recorded message instead of sending them to a live person to talk to. That means 80% of the people who get your pre-recorded message just hang up and you’ll never hear from them again.

    It’s not that they are serious or not, it’s that they absolutely don’t want to get stuck in a phone tree – they seriously want to talk to a live person RIGHT NOW and they will just hang up on your recorded message and call the next guy/gal who actually answers their phone or has a live answering service.

    Technology & automation is great but not for most aspects of your real estate business. This is a people business and a high stress situation for both sellers and buyers. It’s no time to turn the your business over to a robot or recording.

    And for social media, it is good for your web site traffic IF ( and only if) OTHER people are talking about your services and say hey go see Dan at http://www.personalservice.com he actually answers his phone and does not send you to a voice mail or send you an email every other day.

    But if you just have a faceboook & twitter account and waste time posting on there every day/week, it will not do a darn thing for your LINK JUICE or PAGE RANK or Alexa rating.

    Sounds like you are paying for a lot of bells & whistles you don’t need and which can absolutely HURT your business.

    Kris Kirschner left the industry in 2010 and gave his websites and courses over to another training company. I know
    that he lost his mother and his wife, and his dad had cancer.

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