for sale – by the dozens! I’d start mulling over the ads and calling sellers. I didn’t know it then but the gurus of the day referred to this as “Dialing for Dollars,” and it worked! By the end of the day I’d always have a contract on a house. A real winner too! A lot of days I’d end up with two or more of them and I felt like I had barely even been trying. By 1999, I had such a smooth process in place that I was buying, selling, and holding between 50 and 100 homes in inventory each year. It was fantastic, and I felt pretty good for a guy with no silver spoon or formal degree. Don’t worry, though. I’m not getting smug. I’m just telling you where I started. THE CENTURY CHANGED, AND SO DID THE HOUSING MARKET In 2000, finding houses was still a snap, but I was beginning to notice others jumping into the game. It seemed like there was a real estate investing guru on every late-night commercial and a different guru holding a seminar in my town every other week. Investment clubs started popping up and hundreds at- tended their monthly meetings. I started having to compete for houses. While classifieds still worked for finding deals and buying houses they were the most obvious place to go, so everyone went there. Same for the foreclosure auctions and the pre-foreclosure lists; everyone was knocking on those doors. I recognized right away I’d have to get off the beaten path to find the really good deals. I got off that beaten path, literally, and started posting the tried-and-true investor special: bandit signs. You’ve almost cer- tainly seen bandit signs on nearly every high-traffic corner you drive by on a week- end, and they are relatively little work, cost relatively little, and also come with low risk despite being, well, discouraged by most municipal codes. One year, we put out 600 bandit signs and bought 32 houses in the following six months.

This lead generation option is still a good one, but I personally feel like it has lost its edge as more and more investors have started using them. Some cities even have “sign police” who work on the weekends now removing signs and issuing citations. Some investors still swear by it, however, and put their bandit signs out religiously on Friday night before pulling them back down on Sunday. THE DAWN OF THE ANALYSTS In the wake of the housing crash, a new wave of house hunters began to emerge. These bargain buyers had stats, graphs, and charts. They knew all the demographics, could tap county courthouse records via computer, and started mining for hous- es in areas previously untapped. They began targeted mailings, with postcards and letters that look like any other but were very sophisticated in how they were worded. The results of every mailing were measured and evaluated and the term “cost per acquisition,” which told them precisely how much it cost them to generate a lead that eventually became a deal, became part of the lexicon. These statisticians and analysts created a hybrid real estate investor group who had a keen eye for economic trends, a delicate touch with sales copy, and serious real estate investing savvy. This new breed of investor initiated the process of lead tar- geting, which enables investors to identify their perfect audience and their ideal moti- vated seller, then send postcards and other correspondence to the populations most likely to be motivated to sell at a discount. HOWTO BE AN ANALYST STARTING TODAY Sound like a good strategy to you? Take a look at how targeting works to see if it might be a good avenue to bargain properties for you. First ask yourself: Who is most likely to be a motivated seller? As more and more

of these analysts popped up, the industry started honing in on certain types of peo- ple and properties more likely than most to be motivated to sell their house fast, cheap, or both. This group includes: •  People who own abandoned houses •  Absentee owners (houses the owner didn’t live in) •  Owners delinquent on their property taxes •  Owners who have been assessed a fine for code violations (grass too tall, or unsafe properties, etc.) •  Properties assigned a Substitute Trust- ee (The precursor to foreclosure) Then, the statisticians begin to push harder. They started looking for informa- tion about: •  People who recently died •  People who recently filed for divorce •  People being sued for past due prop- erty taxes •  Documents in the courthouse deed records that contained the words “The Estate Of ” Wondering what all of these searches are about? Well, the premise for seeking these specific bits of information is actually quite simple: A lot of homeowners are not where they appear to be based on public record. That means that when you send your mar- keting letters or postcards, they are not get- ting them because they’ve moved and the records are not accurate. Find them, and you have beaten your competition hands down because most people do not realize that a postcard marked “return to sender” is one of the best leads you can get.

The Secret to Beating Your Competition to Bargain Properties AS THE INDUSTRY HAS EVOLVED, THE RULES FOR LEAD GEN HAVE CHANGED.

by Mitch Stephen


’ve been hunting bargain properties for decades. Just like everything else in life, the process has evolved. In a lot of cases, what used to work doesn’t work any- more, and what works today wasn’t even on the radar last year. If you want to be competitive in today’s market, you are go- ing to have to get creative in order to sneak one by the hundreds of other investors all

who uses paper anymore? Back in the 1990s, on any given day I could snag a copy of the daily paper, open it up to the classifieds, and search out the sections that listed Homes for Sale and Homes for Sale by Owner. It was pure heaven: simple, quick, and easy. There, in those sections of the paper, was where sellers would post their properties

looking for those diamonds in the rough.

A BIT OF NOSTALGIA In the good ol’ days, which is to say the 1990s, it was all about the classified ads. Do you recall an anomaly called the newspa- per? It’s no wonder it went all but extinct. They don’t cover the news these days, and

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Mitch Stephen is the author of the book series My Life and 1,000 Houses and host of the RE Investor Summit Podcast. Learn more from Mitch at 1000Houses. com/thinkrealty.

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