One very popular and commonly used marketing strategy among real estate investors is the use of campaigns in generating leads. With the growing housing market, investors have decided to use different kinds of campaigns to pursue more targeted market while being cost-efficient.

Direct Mail Campaigns

A favorite among many real estate investors is direct mail campaigns. With direct mail, you are able to narrow down your list of sellers. You can narrow down your data and lists and specify what type of market to handle.

Direct mail campaigns require some time and a lot of effort. But time can be handled more efficiently if you hire or outsource some of the minor tasks of the campaign, For example, you can hire a part-time employee to write the letters and put the stamps on the envelope.

What is important in direct mail campaigns is that you are able to find motivated sellers in a cost-efficient way. With direct mail campaigns, you can also manage your time well, focusing on only motivated sellers. The main thing you need to do in direct mail campaigns is to watch over and check every operation being done. For example, you have to check over the written letters and look for errors and misspellings.

Email Campaigns

With the evolving power of the Internet, emails have become relevant in the real estate business. They are accessible and faster for communication.

Email campaigns in real estate marketing is mainly used among those that you have forged a relationship with. For example, email campaigns would be best used when keeping in touch with real estate lawyers or bankruptcy lawyers, and other people that can lead you to finding deals and referrals. Forging and maintaining good relationships with them will help you in generating leads, as they can help in marketing you to their clients.

Fliers Campaigns

Fliers are another way to market yourself and look for motivated sellers. The problem with fliers is that they are not as targeted as direct mail campaigns and they also cost you money.

There is, however, a way to operate a fliers campaign for free!

This tactic is called co-branding. For example, you have a mortgage broker. You can work a deal with your broker wherein you market your properties while the broker pays for the campaign. Chances are the mortgage broker would agree to this proposition, since he will be the one who’ll take care of selling your properties. He’ll also receive a lot of profit from this. You, on the other hand, get to save time, money, and energy!

Success In Marketing

It doesn’t take an expert to see that it is the best marketers who stand out of the crowd and gain more leads and deals. Being unique and creative can be very rewarding. Unique and new ideas can gain you leverage over the other real estate investors. Bear in mind, of course, that ideas aren’t the only tools you need to stand out and be successful. Knowledge, systems, and action are also needed to fulfill your strategies and apply them.

In today’s housing market, success isn’t that easy to reach. The primary reason for this is that the real estate market has gotten more competitive and more and more real estate investors keep coming up.

We can hardly blame why a lot of real estate investors have appeared. Foreclosures have doubled, and there are fortunes awaiting those who know where to find them. Real estate investors can surely say that this time is the right time to invest in real estate properties.

But among the many real estate investors vying for the greatest deals and looking for many successful feats in the real estate niches, how do you emerge as one of the successful ones?

5 Keys in Becoming Successful in Today’s Real Estate Market

Key # 1: Arriving at the Property Owner’s Doorstep FIRST

This is already an obvious step for every real estate investor. Getting to a seller first will make you the primary person on the seller’s list of who to contact when he or she is ready to sell.

Being the first will also give a lasting impression to the seller. He or she will be able to remember you more as compared to the other investors that have come after you. Make sure that you market yourself properly, making yourself the “go to” guy when there is somebody who want to sell their property.

Key # 2: Funding the Deal Fast

It is important for deals to be negotiated on as fast as possible. So when you get yourself a deal, the next move is to quickly fund the deal. Now you can either turn the property to cash quickly, put it on subject-to, or turn to a private money lender.

Among the three choices, private money is generally the most popular alternative. Among the many money lending lines, private money lending has the least problems to deal with. There will be no documents and requirements like that asked of a bank, and there will not be a high interest like that asked of hard money lenders. Private money lending is a big thing for real estate investors who need funding without so much of a hassle.

Key # 3: Conducting Business in a Competitive Vacuum

Another way to be successful is to be the first in specific niche that you know will become more competitive in the future…. a competitive vacuum! Being the first have its advantages. You’ll also get to be the first to create marketing strategies out of the business and more profit.

Key # 4: Having a Much Higher Level of Business Sophistication Than Other Investors

The main principle of business sophistication is ruling over your business and not let the business rule you. A lot of people nowadays lat their world revolve around work, neglecting their family, fun, and life. In the end they have forgotten that the primary reason why they entered a business is so that they’ll be able to provide for their loved ones.

Real estate investors especially should have time for breaks and relaxations. Their work schedule is how they want it — no wake up alarm, no traffic jam to work, no bossy boss. The real estate investor makes his own time doing business. Now the high-level real estate investor knows when to work and when to step back. These real estate investors are the ones that you will see are truly in control of their lives and their business.

With this high sense of sophistication, it is easy for many people to recognize who’s successful and who is not. The main keyword is “control.”

Key # 5: Sell the House Fast

Selling the house fast is what all successful real estate investors would recommend. You sell it quick, then you get real money quick. Negotiations would become a burden if they carry on too long. Plus, you’ll have more time to work on another deal once you’ve sold a property. Success can’t be reached with just one or two properties sold, after all.

Direct mail marketing has been popular with real estate investors who target specific prospects and properties, not just because of its efficiency with budget and effort but also because of the high rate of good responses from the prospects.

Of course, failure or success in real estate would also depend on how you do your direct mail marketing. There are three very important things you need to have if you want to be successful in this strategy:

1. You need to have the right prospects or targets.

2. You need to get your envelope to be opened and read by your prospects.

3. You need to make it easy for the sellers to reach you.

Finding the right prospects and sellers will require some research and statistics. You need to learn which niches, which properties, and which areas are most likely to have motivated sellers that can come to you.

For your mail to be opened and read, you can first make some experiments on which of your mails received responses and which did not. But the general advice for your mail would be that:

a.) the envelope used is a no. 10 business letter envelope

b.) you hand address them including the return address

c.) you only put your address on the return address and not include your name

d.) you use first-class postage stamps

e.) you make your handwriting neat and legible, with correct spellings (especially the names

Putting only the address and not your name on the return address will make the prospect curious as to who the mail is from. Hand addressing them will make them seem more personal than businesslike. Chances are, when curiosity takes over, they’ll open the mail and read your letter.

When using first-class postage stamps, choose the ones that will make your letter more personal. Don’t hesitate to use cute ones with the flowers if it comes down to it. These kinds of stamps can have a very personal effect on the letter.

Your handwriting should be legible and readable. Your mail isn’t going to be read if the prospect can’t understand what you’ve written. Spellings and grammar are also important. You need to be imply upon the letter that you are a serious professional real estate investor willing to offer help.

Response Rates Gets Higher!

Direct mail marketing may have a slow start at first, what with all the preparations and the waiting. Preparing the letters aren’t all that hard to do. You can always pay someone copy letters, get lists of prospects, and post the mail for you. It’s the waiting that can sometimes be worrisome.

But as time goes and as responses come, you’ll find that with every mailing you do, the response rate gets higher and higher!

On the average, on the first mailing you might be receiving around 5% to a 9% response rate. But when you get to the fourth or fifth mailing, you’ll find that your response rate has gone up to 18% and probably more!

And this is just the usual direct mail marketing you use. Now what if you add to that creative direct mail campaigns and look for more referrals? Your target list would increase for sure.

There are a lot of motivated sellers out there. Once you’ve found them, you will be entitled to pick the type of motivated sellers that you would prefer to work more with. There are a lot of them, and a lot of place to find them.

Out-of-state owners

There has been a high response rate from out-of-state owners when it comes to selling their properties. Out-of-state owners are people who own property in your area but don’t live there. The extra expenses and effort to care for a property you don’t live in is a particular reason for them to sell their property. You can find these sellers through their out-of-state addresses.

Quitclaimed property owners

There are times when a quitclaimed property will only be an property that a family member can do without. Naturally, the option would be to sell it. These state or probate properties can prove to be a great deal when this is the case.

Farming areas in specific zip code areas

There are areas that have high quality and luxurious houses, and these houses are great deals for a real estate investor.

Multi-family, small or large apartment complex

You can customize your list of multi-family apartments to bring you your desired seller.

Hard-to-find sellers

There is a saying in the real estate niches that goes, “The more difficult the owner is to find, the better the deal.” Vacant houses and abandoned properties have proven to be great deals for a lot of real estate investors.

Preforeclosure properties

The foreclosure and preforeclosure markets are very active in the real estate business. You will also have some help form the mortgage companies regarding state and probate properties in preforeclosure because they know that it’s the only way they’re going to get paid.

Expired listing

Realtors generally bring you deals that they can’t sell. Ask them to give you MLS listings and expired listings.

Military transfers

With military transfers, you’ll be doing real estate and public service at the same time. When the military leases a property from you, they will be the ones who will take care of everything — damages, mortgages, repairs, etc. The only thing you need to do is to have a clause in your lease agreement wherein you cannot penalize them for withholding rent or security deposits. This way, when a resident has to transfer to another area, the military will find another resident to live in the property.

Direct mail campaigns

Direct mailing is a great marketing strategy for targeting motivated sellers. One thing you can do to improve on your direct mailing strategy is to create campaigns wherein you involve more referrals and more target sellers to come to you.

One specific direct mail campaign you can do can be addressed to lawyers involved in general law, real estate law, marital law, and other aspects of property and family life. This way, you can build a working relationship with them wherein they can refer some of their clients that have some trouble with their properties to you.

When it comes to finding motivated sellers, sometimes all you really need to do is look in more deeply in the different niches of real estate to find out which sellers are motivated enough to sell their properties to you. A little creativity is also needed for you to make campaigns and strategies to reach out to them and bring these motivated sellers to your business.

One quick way to success in real estate investing is getting yourself a system that will enable you to find motivated sellers for your investments. Motivated sellers have become vital in today’s real estate niches. They are easy to deal with, and they’re also not that difficult to find once you’ve got a marketing strategy ready.

Why start with a marketing strategy in finding motivated sellers?

One reason is that you need to get yourself an endless supply of motivated sellers. A system would help accomplish this task, and within this system it is your marketing strategy that will be driving them in. With a marketing strategy, you’ll also help the sellers to find you instead of you finding them!

A marketing strategy will also give you an unfair advantage over your competition. When your strategy has made its appeal to the seller, he or she will want to make a deal with you and not another real estate investor. There will be no one else involved in the deal except for you and the seller.

Having a marketing strategy will also enable you to explore new ideas and tactics, and eventually you’ll be able to buy properties that no one knows are for sale, including the seller! There are times when the seller have lots of problems and have no idea how to process the deal by themselves.

5 Steps to Finding Motivated Sellers

1. Pick your target prospects.

In picking your target prospects, you can go through two approaches:

• Shotgun Approach: flyers, newspaper ads, business cards, etc.

• Targeted Approach: going after specific targeted people

The shotgun approach appeals to the general public. Most likely, you’ll just be sitting and waiting for someone to read your ads and contact you. The targeted approach, however, will be directed to a specific group of people whom you most likely think will respond to your advertisement or marketing strategy.

2. Mail a proven letter.

A proven letter is a letter that you know will work, a letter that your prospect will really open and read. It also contains facts and contact details for you and your prospect to communicate with and work on if he or she accepts your offer or service.

You have to be clear with your contact details in a proven letter. Give the seller multiple ways to contact you — phone numbers, fax, email address, the mail, etc. Giving them these different ways of reaching out to you will give them the ease and comfort of contacting you, and that is a great way of communicating out to your prospects.

3. Answer the responses of the sellers.

When the sellers give you a response, it is an obvious task for you to answer them as soon as possible. Don’t ignore them, and don’t think that they can wait. There are deals wherein sellers are in a hurry to sell their property.

In reading their responses and answering them, you should also go through the list and figure out which sellers should you give priority to and go with.

4. Buy houses.

When you’ve got your seller, and got a great negotiation going, then you got yourself a great deal!

5. Create a system that is going to get you deal after deal.

After your first target prospect hunt, it’s time for you to take action in making a system wherein you do the same strategy over and over and works every time! In employing this system, you’ll be able to get deal after deal with efficient means and no waste of time, money, and effort.

Building contacts in the real estate business may dwell on establishing a stand point wherein sellers will be glad to sell their property to you and you only. Your marketing strategy will be vital at this point. Always remember that reaching real estate success means finding motivated sellers.

Most of the real estate properties you’ll encounter as a beginner or experienced real estate investor will need a lot of fixing, inspection, and costs. Finding a good property wherein the expenses won’t eat you up is challenging, and you have to make certain that you buy properties that you will be able to sell.

There are four main exit strategies in real estate investing:

• Wholesale, which will give you an active income
• Retail, which will also give you an active income
• Rental, which will give you a passive income
• Private Lending, which gives you portfolio income

Other techniques in flipping or keeping the property are just that — techniques. These four are the main exit strategies that real estate investors should focus on.

In applying these exit strategies, you first have to take a look at the property you’re buying. In real estate investing, you make money when you buy a property, not when you sell.

7 Steps In Buying a Property

1. You have to first tell the world that you by houses. So start by marketing yourself as a buyer.

In marketing yourself, you will be able to get more resources in looking for leads. Do not do so much advertising on ads and newspapers. They can help but not as much as getting leads from referrals and drive-bys. Most leads are generated from contacts and networks you have. Marketing yourself as a buyer will set you in this pace.

Concentrate on getting a pool of referrals. Make a marketing business card and also prepare a professional business card as you go along marketing yourself.

2. Develop two important skills in looking for good deals:

·        Identifying distress properties

·        Identifying distress sellers

You don’t just choose any property that you lay your eyes on. You have to pick them wisely. Remember, you make money when you buy, not when you sell.

In identifying which homes to pick and get fixed, inspect them diligently and wholly. Check if you should either fix the home or have it remodeled.

In looking for the owners of the properties or houses, there are five ways to go about it:

a.)   talk to the neighbors

b.)  check tax records

c.)   check for deed records at county clerk’s office

d.)  address correction request

e.)  check the utility companies

In checking for the owners, you will recognize distress sellers when they’re going through a divorce, job loss, failed business, or anything that has rendered them unable to make payments.

3. Find motivated sellers.

Making a deal with motivated sellers makes real estate investing easy for you. In finding motivated sellers, all you really need to do is ask the seller why he or she is selling the property.

4. Do the inspection.

When doing the inspection, check every corner and every side of the house. Check first if the property is really fit to be in the neighborhood or if it’s in the right place. Then check to see if the house needs to be fixed or remodeled.

Above all, see to it that you can take care of the expenses and that you’re sure you can sell the house.

5. Present your offer quickly.

In the real estate business, it is wisest to offer your deals fast, usually within twenty-four hours. Successful real estate investors would always say to make the deal and sell the property quickly. The same goes with presenting your offer to the seller.

6. Negotiate and Escrow.

Negotiations and completing the deal are inevitable, of course. Learn to say it right and how to do it right. Get to know the seller, his reasons for selling the property, and help him attain his goal of selling it that will benefit the two of you.

7. Check the title.

Always check the documents of the property. Check the title and deed of the property. Make sure it’s clear who the owner of the property is.

With the many tips and advice being given by successful real estate investors, it can become difficult for beginners and striving real estate investors to take in everything. All those mounting information will become a jumble in the head in the process.

That’s why it is important to have a system in investing in real estate, a system that you have researched on and one which you have tested and corrected.

T – time tested

R – results proven

U- unique

E – effective

S – save

Y – your

S – self

T – time

E – energy

M – money

This will become the code of the TRUE SYSTEM of real estate investing.

Within this system, the process of real estate investing can be broken down into ten steps. This process will be your guide in how to buy right and win, gaining wealth and profit!

THE TEN STEPS

1. Put together a “Power Team”

Your power team will be made up of the entire team that you’ll be working with throughout the process of investing in a property. The power team consists of realtor or brokers, lenders or bankers, home inspectors, contractors, appraisers, attorneys, accountants, and other people who are necessary to start and finish the project.

2. Locating Properties

In locating properties, you can either look for it in your area by driving around and looking out for notices of sales or foreclosure, or you can look in the Internet and do a wide search on properties that you can invest in. The following are some sites that can help you search for property:

www.ocwen.com

www.homesales.gov

www.foreclosures.com

www.resales.usda.gov

www.buybankhomes.com

www.firstpreston.com

www.hud.gov/homes/

www.homesteps.com

Other sources to know where to find properties are just around you. You only need to ask. Ask your family, your friends, associates, or people in the business. You can look it up on record services or auctions, too.

3. Research Property

Once you’ve found a potential property, you normally don’t go in and take the plunge. First, you need to do a thorough research on the property — its area, the market, the deed, insurances, mortgage, and a lot more.

Here is a list of websites that can help with your property research:

www.hpapts.com (Hendricks and Partners publication and website)

www.city-data.com (for specific city information)

www.census.gov

www.bea.gov (Bureau of Economic Analysis)

www.rentslicer.com (market rents)

www.huduser.org

4. Inspect Property

The home inspectors in your team can handle this. But, of course, you should still know what the property has and needs.

Here are websites that can help when you’re looking for home inspectors:

www.ashi.org (American Society of Home Inspectors)

www.hometeaminspection.com

5. Financial Analysis

A financial analysis is needed, and it is crucial that you have one. You need to come up with a solid assurance that this project won’t go down the drain. Project budgets and calculations as to how much the property will cost you and how much it will bring back to you.

One of the bases in the financial analysis of whether or not a property is worth investing in is the CAP rate. It is the rate of return on net operating income considered acceptable for an investor and it is used to determine the capitalized value of a property. The higher your CAP rate, the better results you’ll get. A cap rate of 10% is considered a very good deal. Just remember that it has to be your personal CAP rate and not the market CAP rate.

6. Negotiate and Structure Your Contract

The results of the deal will mostly be determined by how well you negotiate and structure your contract. So it is important that you pay close attention and be very critical of how you handle this process.

Within the negotiations, always ask for seller financing. Ask if the seller will be willing to pay all or a portion of the closing costs. This may not always be the case, but it would never hurt to ask.

Compare the market value of the property, and try to reduce the offered price of the property for the needed maintenance. Make sure to estimate construction costs, holding costs (mortgage, insurance, utilities, etc.), and estimate the time needed to cover them all. Estimate the other finances that have to be considered, such as the required profit for a great deal, the income to be generated to determine the profitability of the deal, and the closing costs.

Always confirm 1031 funds if there are any, prior to making your offer and prior to closing escrow. Make sure there are no prepay penalties, and negotiate a lower sales price if you find that the property has defects and requires maintenance. Confirm that there are no hidden leases existing and base your estimated income based on actual copies of the leases. It is clearly evident that you have to obtain all the documents and contracts on the property to make your decisions and for the negotiations to go smoothly.

Make a clear inventory of the property. Makes sure specific equipment are privately owned by the seller, and require an inventory list of the things that go with the property. Research and ask for the building plans, engineering, bids, and estimates that have been completed or are in the process of completion.

These are mostly some critical points that you shouldn’t forget when going through a negotiation. Remember that negotiating is just equal to producing your profit!

7. Buy it Right!

When buying and investing in a property, there are precautions and check-ups to be made with the property. First of all, you have to procure landlord insurance for your protection before doing anything with the property. Obtain bids on all the necessary components of rehab and check on the lights, plumbing, and other utilities. Make a proper budget plan for the rehab, and immediately put your rehab team to work. Time also costs money, so it is important that you optimize every second of it.

Develop contract with the default language, with specific penalty clauses, and clearly define your terms and conditions regarding payment and costs. Don’t forget to obtain copies of insurance and licenses, too!

In your rehab and improvement project, it is normally wise to start with the exterior of the property. Remember that every second counts, so you might want to start advertising the place after you’ve renovated the outside. You can work on the inside even if the advertisements are still going since it’ll be the outside that will first be shown to the public.

In offering your price for the property, remember not to offer too much too soon. You should proceed with this negotiation as conservatively as possible. Remember that you have to buy it right!

Here is a list of websites where you can get contractors for your team:

www.angieslist.com

www.everycontractor.com

www.renovationexperts.com

www.nahb.com

8. Get property appraisal

The appraisal of the property can be either done by you or a recommended contact of your lender. Always ask first if your lender has a list of appraisers. This will also help in fostering your relationship with your lenders and in building a healthy network in real estate investing.

If you’re going to choose the appraiser yourself, ask and confirm if they have any errors and omissions insurance. Most lenders do not actually accept appraisal without errors and omissions insurance so be particular about this one.

Here are some websites that you can look up for property appraisal:

www.zillow.com

www.firstamres.com

www.housevalues.com

www.cyberhomes.com

www.realestateabc.com

www.naifa.com

www.appraisalinstitute.org

www.ana-appraisers.org

www.appraiserdatabase.com

9. Refinance for Tax Free Proceeds

The financials continue to be first priority, from the start to the finish of the deal. Refinance for tax free proceeds and go over your income and profit. Remember that proceeds from loans are not taxed.

10. Retain property or do a 1031 Exchange

You have either the option to retain the property and get residual income and monthly cash flow or you can sell the property and do a 1031 exchange to protect your equity.

Throughout the process of investing in a real estate property, remember to be critical. At first glance, consider looking at purchase price, the amount of money needed to fix it up, the rent, the existing market pressures, and the uniqueness of the property and the benefits it can give. Do not forget to base your purchase price based on today’s value.