If you are in real estate direct mail is one of the better ways to get your pipeline full of deals. In this article I am going to cover the main benefits of using direct mail in your marketing and prospecting campaigns. I will also give you an easy to follow process and provide you with resources so you can use this method ASAP.
One of the biggest benefits to direct mail is the leverage you gain. Sending postcards, yellow letters, or other letters will allow you to send one message to hundreds of prospects. The biggest challenge investors face when deal sourcing, is finding the time and/or patience to sort through hundreds of potential deals to find one nugget of gold or needle in the haystack.
Direct mail solves that problem…
With direct mail for Real Estate, you create a letter just one time that you want to send out to the apartment owners. Then, you can mail it to one, dozens, hundreds, or even thousands of prospects at one time. This way you can get the message out very quickly to many potentially motivated sellers.
Here is a 5 step process that I use when deal-sourcing through direct mail:
- Determine my market: Do I want to look for small apartment buildings like 2-4 flats? Maybe 6-50 unit buildings? Or something bigger like 50-200 unit deals? The smaller they are, the more local I can be. If I want to mail to 1,000 owners of apartment complexes between 50 and 200 units, I will probably be picking 2 major cities around the US. If I am going with the smaller deals, I can pick one tertiary market of a major city.
- Create a mailing list: The fastest way to create a mailing list is to look for a list broker and pay for their service. You can google “list broker” plus the name of your market area. For example, you may say “list broker in los angeles ca” if your market was Los Angeles. Another way to go is to go down to the county courthouse for your market. You can ask the information desk where you can pull public records for Real Estate taxes. Then, look for apartment buildings that meet your criteria.
- Create your letter(s): You can create a personalized letter which you can write by hand or print from a computer. By hand takes forever. If you are only sending a few letters, this may be the best way. If you are sending at least 100, I would recommend adding the names and addresses to a database so that you can print each letter customized to the owner. The letter can be very salesy, but I do not recommend that. If you speak your own language in the letter and you get a call from your letter, it will be much easier to have a real conversation with the owner so that you do not have to feel like you have to maintain someone else’s personality. Here is a link to one of my letters so that you can see an example of what you might want to say.
- Mail your letters: Now that you have everything ready to go, all that is left is mailing them. If you have lots of time, you can sign, fold, stuff, stamp, and address the envelopes yourself. If you do not have time, you can hire someone you know for 10-15 cents per letter to get them ready for you. Once they are signed and sealed, you can take them to your post office and expect the calls to start coming in.
- Be ready to talk to owners: Knowing what to say and being pro-active about your deal criteria will go a long way in building rapport with the owner which will go along way to getting them to like you which will go a long way to getting a deal. Phew, that was a crazy sentence. You can build your own script or you can use my apartment building seller script.
Direct mail is not cheap but it is effective and well worth it. Plan on spending $1/letter. You can get it done for less, but that will allow you some room for error. If you can afford $100/month, then you can send 100 letters/month. If you have $1,000/month in your budget, then you can send 1,000 letters/month and so on. The key to Real Estate Direct Mail success is to maintain consistency. This is not a 1 pop shot. It will take about 7 letters on average to get the prospect to think that you are credible and serious. The owners who are motivated right now will call you anyways regardless of how many letters they have received from you. It’s always different but if you plan your next year of direct mail campaigns right now, and stick to it, you will have a very good chance of making very good money.