January 31, 2016 at 9:30 pm #2154
ChrisParticipantJanuary 31, 2016 at 9:30 pmPost count: 252
I’ve noticed most people who want to sell their property are out of towners. They do not live in the area.
When sending direct mail, can you tell me what percentage of the sellers are people from who do not live close by the property?
I’m just wondering if it makes more sense to only mail to people who don’t live in the same zip code/city as the property. It seems less likely they would want to get rid of the property or sell the plot of land, right down the street from them.
What’s your percentage?
Do you think it’s worth it to send mail to locals?
Kevin RhatiganParticipantFebruary 1, 2016 at 7:48 amPost count: 107
Just my opinion but I would not leave out people who live nearby the land. I have had a few calls from locals and I am sure will buy at some point from someone who lives near the land.
It is easier to buy from someone out of the area but who knows when that local person may need the cash more than the land.Mike O’MearaParticipantFebruary 1, 2016 at 12:36 pmPost count: 18
Makes sense Chris. I think owners who are out of town figure they have limited options when it comes to selling. Locals can at least put a signs out.ChrisParticipantFebruary 1, 2016 at 2:18 pmPost count: 252
I agree, it definitely makes sense. You will of course have a higher success rate when mailing out of town owners. Inevitably you will of course end up buying property from locals because most lists seems to have more locals than non-locals (duh!).
But if you have a mailing that cost $1000 and you are spending $700 sending mail to locals and $300 to out of towners, yet 90-95% of your deals come from out of towners, does it make sense to spend the $700 to send offers to locals?Seth WilliamsParticipantFebruary 1, 2016 at 6:09 pmPost count: 12
I guess it just depends on how you define “locals” and at what point they’re considered “out of towners”. Generally speaking, the further away they are, the higher their likelihood of selling at the price you want… but I’ve found that once they’re out of the county, that tends to be far enough,ChrisParticipantFebruary 1, 2016 at 6:40 pmPost count: 252
@retipster Thanks for chiming in Seth!
Yes, that’s kind of what I meant by “out of towners”. Not in the same city, not a quick drive to the property – so the county level would be a good boundary line.
Did you scrub your lists for locals who had mailing addresses in the same county as the vacant land? (back when you were sending out mail)Ben HParticipantFebruary 1, 2016 at 7:34 pmPost count: 77Jermaine and Faith HillParticipantFebruary 1, 2016 at 7:34 pmPost count: 36
This is a great question! I agree with Seth in saying the further they are away the likely hood they will be more motivated in selling their land at a discount. That’s why Mark and Jack & Michelle have been successful in just focusing on out of state tax delinquent list. With some of their students being successful at this approach as well.
With me having a background in Industrial Engineering and always looking at ways to improve my process, this is a metric I am tracking in Podio to see where I am getting the most bang for my buck. I also agree with Steve and Jill in mailing everyone, because I have gotten calls and closed on a deal where the seller lived in the same county she was selling her land. Last week I had a seller who wanted to sell his land that was right next to his primary home, but he wanted a little more than I was willing to pay for it.
It all comes down to your numbers. If you see you are closing on more deals and your profit margins are higher with mailing out of state owners than maybe it makes sense to shift a higher percentage of your mailing to out of state owners.
This year I have decided to increase my percentage on auction list mailing this year because of the numbers I saw last year. I would say this also may depend on the location you are mailing. My advise would be give it a test and try it out for a few months and let your numbers guide your decision making. Hopefully that helps a little. I know it was a little long.Luke SmithModeratorFebruary 1, 2016 at 8:28 pmPost count: 1262
It is hard to test because everywhere is different. You might mail somewhere that just got mailed compared to somewhere that has not been mailed for a long time.
Other places like Florida probably have more out of area owners than a place like Northern Arkansas or West Texas.ChrisParticipantFebruary 1, 2016 at 9:44 pmPost count: 252
Thanks for the feedback. I will say one thing, I am mailing on the east coast and I”m experiencing a much lower response rate than other people here and I mailed to only out of town owners.
I guess the lower response rate is offset because the potential profit is better but it can be discouraging. If I mailed to locals also, the conversion rate percentage would have been even lower. I’m just trying to hone my approach…George DeanParticipantFebruary 2, 2016 at 6:29 amPost count: 76
FORGET “conversion rate”. That is the WRONG question and answer.
The answer to your question is ALWAYS ROI!
Forget percentage returns. WHO CARES.
We are about CASH ON CASH RETURN. Did I make more profit than the investment of time and money.
I’d rather have a 1/2 of 1/2 percent response rate and make $1M THAN have a 25% response rate and make $50K.
Maximizing response rate IS important but not THE key metric, in my humble opinion. This is why we use Steve’s mailer versus a postcard – it boosts response rate.
JUST make SURE you are tracking your mailings ROI by any category you deem important (ex: out of county versus in county mailers)
JUST my thoughts
GeorgeJoe KParticipantFebruary 2, 2016 at 8:52 amPost count: 68ChrisParticipantFebruary 13, 2016 at 10:17 pmPost count: 252
Well, I decided I needed to test this out myself 🙂 I previously mailed an entire county of out-of-towners and I have all of my response data on it. This list was anyone who lived outside the county.
Now I’m mailing a letter to all of the local people and I will see what type of response I get.Luke SmithModeratorFebruary 13, 2016 at 11:11 pmPost count: 1262
Nice way to test. I love testing theories. Especially when each is probably profitable. One probably more so than the other.
Do you think out of town sellers are more common in your area. Maybe other areas that work too are mostly owned by locals.
I think there are many variables.
ROI is the measure. Good call George.
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