The Ultimate Direct Mail for Buying Houses

Imagine mailing 3000 real estate marketing pieces, targeted to ideal neighborhoods, for only $900!

This article will show you how to mail a three-page sales letter to sellers for only 30 cents each. That’s for everything including postage, list, labor, and printing. By getting only a .3% to .5% response, you’d get 9 to 15 sellers calling you from your mailing. And if you know how to buy houses creatively, that means one or two deals.

In my opinion, if you cannot make $15,000 to $30,000 in cash and equity buying a house, it is not a deal. Now imagine doing that:

Without printing envelopes
Without printing three pages
Without folding
Without stuffing
Without sealing envelopes
Without hand addressing
Without applying stamps
Without paying 37 cents for postage
Without trying to make it look personal
Without trying to get the prospect to open it
And without paying 3 to 10 cents per name

I love direct mail because it can be narrowly targeted. Normally I suggest using personal-looking letters in plain white #10 envelopes, handwritten, or typewritten (or typewriter looking laser font) address, live stamp, and a very targeted list.

Your cost for printing a three-page sales letter, folding, inserting, sealing, posting, and addressing will run you 70 to 95 cents each, including hiring someone to assemble and mail your package.

This is a good strategy for a good, targeted list of sellers. However, it may prove too costly for a shotgun blast to occupants or homeowners from tax records.

By reducing the work and money needed to get your message out, you now can hit every home in a targeted neighborhood.

You can dominate your “farm” area by re-mailing over and over to the same areas and enjoy these advantages:

Become a “big fish in a small pond”
Become the first option sellers explore when they decide to sell
Hit the best neighborhoods or parts of town you want to dominate
Put your lead generating system on automatic pilot
Create a powerful presence and ongoing relationship with your targeted market
Follow up on past inflexible or unmotivated callers automatically
Callers will be higher quality and more prescreened, already knowing the benefits you can offer
Buy more houses from fewer leads
Qualify for the lowest postage rates available, usually around 15.2 cents each
Control how many sellers call you each week. Crank it up when you want, or slow it down when you’re on vacation
Focus your time on talking to sellers, prescreening deals, making offers and getting your houses occupied fast
Avoid the need to study, create, test, and setup different ways to get your phone ringing
Eliminate the need to call sellers off ads or signs, or compete for the killer “cash” deals listed with agents
Easily expand your marketing with the intent of flipping “excess” deals to other investors for quick cash
Avoid competing with other ads in the newspaper or yellow pages
Avoid paying more because another investor made a competing offer
Become a property value expert, increasing your confidence when making offers
Know how easy and quickly you’ll be able to get a house occupied from recent experience in your market
Build up and use an in-house “buyer’s list” each time you get a new house
Form a solid “dream team” of professionals, which can simplify your life because they prefer to work in your farm area. These may include title companies, insurance agents, house cleaners, landscapers, handymen, contractors, real estate agents, property managers, appraisers, inspectors, fellow investors to flip to, etc.
Save time and get a lot done with less effort. By cost effectively farming, you’ll be able to check on your houses, replenish flyers, meet with buyers, follow up on a contractor, and visit with a few sellers–all on one trip!
Create instant credibility. Sellers will see your message numerous times. And that might be the compelling reason they finally call you.

The way you do all this for only 30 cents each is to saturate targeted neighborhoods with “oversized” postcards. Here is how to do it step by step:

Step 1

Write a lengthy message to sellers explaining the benefits and reasons why they should call you. Long ad copy works as long it talks about the benefits to the seller and it is not boring.

Use a letter that has already worked for you. Or check your inventory of courses that sit on your bookshelf. Or perhaps start from scratch. Your message should talk about all the different problems you solve for sellers and the benefits they get when you buy their house

Step 2

Make sure you have a good headline to get attention and get your prospect to read further. In the past, I’ve used “Sell your house in nine days or less at no cost to you.”

I have since improved and tested my headline and I now use, “How to sell your house ‘as is’ at a fair price on the date of your choice.” This approach attracts many lease option, owner financing, and “subject to” deals.

If your intent is to target lower-priced homes, likely to be fixer-upper deals bought with all cash, then your headline may be “We buy houses cash.”

Your message should take on a personal tone. It should read as if you were sitting in front of the prospects talking to them one on one. Avoid having it read like a broadcast to a group of people.

Step 3

Lay out your message to look like a newspaper article. Design in a multiple column format. You can use a “drop cap” to guide the eye to the first paragraph. Avoid logos, photos, and graphics. I conclude with a signature line to make it more personal. Adding a P.S. is also good.

I add few hand-written notes to the artwork before it is printed. This is a little trick to get more attention. More details on laying out your postcard are in Step 8.

Step 4

Choose your media. For this system we are going to use an oversized postcard. Postcards are cheaper to print, don’t have to be folded, inserted, and sealed. They don’t have to look personal to get opened like a letter.

I’d never send letters bulk rate (now called Standard Mail) to save postage. My letters always get live stamps. However, you can use bulk rate for postcards, even use a bulk rate indicia (permit stamp).

And since you want address changes when mailing letters to a very targeted (hot) list, you’d use first class mail. For this postcard system we do not need these address changes since we are going to use a residential occupant (saturation) list of just addresses, not names.

The result: you save time and money not having to pay first class or pay to have stamps applied.

I like using 11″ x 5.66″ card. The printer can get 3 on an 11″ x 17″ sheet. After calling a number of printers for bids I was able to get printing costs down to 5 cents a card. Another standard size you can use is 8.5″ x 5/5″ (half sheet) if you can get your entire message on it, but the larger size is costing me the same.

Mailed first class, this card would cost 37 cents postage. Mailed bulk, it averages 15.2 cents.

Step 5

Choose which neighborhoods, subdivisions, or parts of town you want to dominate. I suggest 30,000 homes or fewer. It might even be better to choose 15,000-20,000.

Since I know my marketing message works (six years of experience), and I know that using oversized postcards mailed to a saturation list works for getting the message out cost effectively, the only other element that has a major impact on your results is the areas you target.

Do you want ugly, low cost fixer-upper properties? Do you want newer homes with less in repairs and less equity so you buy them “subject to” for no money down?

Do you want to expand your activities where you already have bought houses? Target the property you want by targeting the types of neighborhoods or parts of town which match your preferences.

I would not target areas where most houses move very fast and lack enough motivated sellers or high priced areas, unless that was part of my buying plan.

Step 6

Find a source for “residential saturation” or “residential occupant” lists. My source is only about 1 cent each ($100 for 10,000 addresses) discussed shortly.

Some investors can get lists of “homeowners” from county tax records for free. But you’ll pay more for postage when mailed bulk (18 or 19 cents each) and A LOT of these are outdated (up to 30%) and will never reach the owner.

Saturation mailings have one piece delivered to each house on a postal carrier route. So the downside is your message will go to both renters (a waste, except for referrals) and owners.

Plus, owners of vacant houses will not get your card unless their mail is still being delivered to their mailbox and they pick it up at some point.

We can live with this drawback since we’ve kept are costs down super low. One way mitigate this is to add a pre-headline “Are you or someone you know looking to sell a house?”

I use >www.melissadata.com to research and order lists. You can instantly get list counts and carrier route counts for a zip code or for a radius surrounding an address you provide. You can exclude apartments and post office box holders if you like, but be careful.

You want to eliminate ENTIRE carrier routes if they have a lot of apartments, perhaps more than 20%. You need to mail to every address in the carrier route you select to get the lowest postage.

In a nutshell, to eliminate most apartments, when you locate the free mailing list “look up” feature at www.melissadata.com,

Click “Search by Zip Code.”
Enter a zip code
Exclude PO Boxes (if you wish)
Click Get Count

The result is a the number of carrier routes in the zip code you entered, plus the number of apartments and the total number of addresses.

Now click “Select Carrier Routes” at the bottom. Copy and paste route numbers and counts into a spreadsheet (like Excel).

Now go back and do it again excluding apartments.

Copy and paste side by side into your spreadsheet
Add formulas to calculate the difference in the counts and percentage of apartments
You’ll be able to identify which carrier routes have a lot of apartments
Deselect those routes when ordering your list

Another way to identify targeted carrier routes is using a “carrier route map.” You can order them online by searching the Internet.

A map like this can help you eliminate carrier routes close to industrial areas, busy streets or higher crime areas. In most cases, this step is unnecessary.

Step 7

Find a letter shop, mailing house, or printer who offers mailing services. You can look up in the yellow pages or online. Researching this may take time.

You’ll want to get multiple bids and pricing for your project. Once you find someone it will be easy to repeat for future mailings… unless, of course, you’re unhappy with them and need to find a new one.

Besides printing, the mailing charges will include

Addressing via labels or ink jet
Adding their mailing permit to your postcard artwork
Counting out and sorting by carrier routes
Completing the required postal reports
Delivering the sorted trays of mail to the post office

Some mailing houses can sell you lists, but I have not found one cheaper than www.melissadata.com for saturation.

Order your list from them on labels (extra cost), CD-Rom, or preferably, downloaded over the net. Then forward to your mailing house. Addresses in carrier routes change so you’ll order a new list each time you mail.

Step 8

Find a printer for your postcards. We’ve been quoted 4 to 9 cents each depending on printer, size, and quantity. You are doing good at 5 or 6 cents each.

Here are some standard “oversize postcard” dimensions, again, standard depending on the printer:

8.50″ x 5.50″ (1/2 sheet or 2 up on 8.5 x 11, easy and low cost) 6.00″ x 11.00″ (bigger and more expensive but same postage rate) 5.66″ x 11.00″ (1/3 sheet or 3 up on 11 x 17, my preference)

The maximum size allowed by the post office is 6.125″ x 11.5″ but that’s a non-standard size and can unnecessarily increase your printing costs.

Get bids using yellow card stock (10 point), double-sided, black ink. It works great.

Step 9

Mail only 3,000 to 10,000 cards at a time so you know you can handle the response and effectively follow up.

I was a little overwhelmed last time I mailed 10,000 (bought five houses and captured $146,000 in equity), so I prefer to space out two 5,000 piece mailings over two weeks.

Step 10

Track your response. If you don’t buy a house or two from each 5,000 cards mailed or if you don’t get AT LEAST 10-15 sellers calling, you may want to test different areas.

Step 11

Make offers. Buy houses.

Bottom line: I love the postcard system and all the advantages of it. It’s the main marketing I will be doing for myself, even though I have a half dozen other cost effective, proven ways to get the phone ringing.