Wholesale Real Estate Marketing Secrets - What The Guru's Won't Tell You

​If you're new to real estate wholesaling, you need to figure out how to find motivated sellers. Now, if you're on Facebook, or BiggerPockets, or any of these websites, you are likely getting all the wholesaling guru pop up ads. So all day long you see ad after ad all telling you, "I've got a system where you just turn it on, and it's going to give you 10 leads a day or 15 leads a day" or "Oh, I've got chat bots bringing me leads in all day long."  There is a lot of stuff out there and a lot of nonsense products that other people are out promoting. I can't knock them for that! If I had a product to sell I’d be out there promoting it too. But right now I want to make a post and tell you the truth about wholesale real estate marketing. I’m going to discuss the products everyone talks about and tell you what works, what doesn't work, what the costs are, and how effective it'll be for you. Hopefully, this video will give you a good understanding and realistic expectation of what will and won’t work for you.

​If you're new to real estate wholesaling, you need to figure out how to find motivated sellers. Now, if you're on Facebook, or BiggerPockets, or any of these websites, you are likely getting all the wholesaling guru pop up ads. So all day long you see ad after ad all telling you, "I've got a system where you just turn it on, and it's going to give you 10 leads a day or 15 leads a day" or "Oh, I've got chat bots bringing me leads in all day long."  There is a lot of stuff out there and a lot of nonsense products that other people are out promoting. I can't knock them for that! If I had a product to sell I’d be out there promoting it too. But right now I want to make a post and tell you the truth about wholesale real estate marketing. I’m going to discuss the products everyone talks about and tell you what works, what doesn't work, what the costs are, and how effective it'll be for you. Hopefully, this video will give you a good understanding and realistic expectation of what will and won’t work for you.
 
Direct Mail
 
Let's start off with probably the biggest marketing strategy that you see, mailing. With direct mail, you are mailing to absentee owners or other prospective customer bases. So how many absentee property owners are there in America? After running the numbers and doing some research, it appears that roughly 30% of houses in the United States are absentee owned. Some locations have ore, and some have less. For example, if you are looking to market to vacation areas, the number of absentee owned properties will be higher. If you are looking to market in a rural area, the numbers tend to be lower.  But what does that mean exactly for you? Let me explain what an absentee owner is.
 
An absentee owner is when you own a property and the tax bill is going somewhere else. The tax bill could be going to a PO Box, another house you own, the individual’s office, or anywhere else that owner decided to send it. So the ONLY qualifying factor to be an absentee owner is the tax bill is not being sent to that address. So, if I own the house my dad is living in, and I get the tax bill sent to my home, I am an absentee owner. If I own a vacation property in Florida but I have the tax bill sent to my primary residence in Massachusetts, the property is absentee owned. If I choose to send all my mail to a PO box because I’m afraid someone will take it if I am not home, my property is absentee owned. Any of these scenarios plus more could be the reason a home is qualified as absentee owned.
 
The point I am trying to make is that just because a property is absentee owned doesn't mean the owner wants to sell it. There's no additional motivation there for the owner to sell a property. An absentee owned home isn’t necessarily vacant, damaged by a fire, or behind on their taxes. It just means the tax bill is going somewhere else. So, my point is, don't just send direct mail to absentee owned properties. You're going to waste your money. Your response rate is going to be on average 1% -2% if you're lucky. You could get the same response rate if you picked a random 1000 to mail to. So while the Gurus are pushing the absentee owner lists, I suggest you stay off that path. You are going to waste a lot of money.  I personally mailed to absentee owners when I first started wholesaling, and I was blown away by how disappointed I was with the results of it. Don’t make the same mistakes I did by going down the absentee owner list rabbit hole.
 
I'm not saying all direct mail is bad, but you want to target things that are more specific. You want to target tax delinquent properties, probate properties, vacant properties, low water usage properties, or other properties like that. For example, low water usage is just you know nobody's living in the house, because nobody's using any water. Direct mail that is more targeted is going to give you a better response rate. You want to send out your mail to people who you feel are more motivated to sell, which in turn will increase your response rate of the mail you send out. Another benefit with a more target list is with a higher response rate, you don’t have to send out as much of it! If you're sending out 2,000 pieces of just absentee owner mail, you can narrow that list down a lot. Instead of mailing to the general absentee list, send to just the vacant or probate lists. Sending out your mail to the smaller targeted lists will wield the same results as you would have gotten with the larger more general absentee list. Even with a more targeted list, don’t expect the response rate to blow you away.
 
You're not going to send out 1,000 probate letters and get 500 people to call you back. It's not going to happen, because people are just so numb to junk mail or any type of mail now. When my mail comes, if it's not from the gas company, the electric company, the water company, or another bill I am expecting, I don't open it. If I see the little co down on the bottom, I know its junk mail, and I just throw it away before I even open it. I'm going to take a wild guess and say that there are a lot of people like me. So if you are just getting started in the business, save the direct mail from when you close some deals and have some extra money to play with. Then when you start mailing to lists, you can try different things and see what works best for you. If you are just starting out and on a budget, don’t jump straight into the direct mail money pit. There will be time to work on direct marketing later.
 
(If you're interested in sending direct mail, my favorite list is vacant properties. You can access all the vacant properties in your area using the Vacant House Data Feed)
 
Bandit Signs
 
Second thing I want to talk about is bandit signs. Personally, I am not a big fan of them. Have I put them out before? Yes. Do they work? Yes. But I don’t like doing them. I’m going to be honest with you, there are plenty of people who like and use them, but I am one of the guys who think they look junky, and I don’t want to promote my business that way. However, the information I put out on The Wholesalers Toolbox is for everyone and not just for me. So I am going to be completely honest about bandit signs. They work. If you put enough of them out there, people are going to call you. Now, let’s talk about the numbers. There is no way to judge what your response rate will be with the signs, unless you start getting traffic data and find out how many people are going by an intersection and calculate who is looking at the sign versus those looking at their phones. Results from bandit signs all rely on how many you have out there and how consistently you do it.
 
You can’t expect to put 2 or 3 signs out and start getting the deals flowing in from them. That isn’t going to happen. People who get a lot of deals from bandit signs put out a lot of bandit signs. They put out a 100 a week, maybe a couple hundred a week, or at least 50 a week. They are the ones going out and putting them all around town. I know you’ve driven in town and seen the signs; you stop at one intersection and see one, only to see another one a few miles away. The people who are successful with this strategy are putting them all over. That is the strategy you need to have with the bandit signs. You need to put a lot of them out and keep them coming week after week.
 
Bandit sings cost about a dollar a piece. So if you are marketing on a budget, you have to plan around the budget to market effectively with the signs.  You need to know if you have 100 dollars a week or 100 dollars ever couple of weeks to put them out. And that’s if you mail your signs to a pole. If you are going to put them on a wire stake and stick them into the ground, you need to buy the stakes and add about another 50 dollars to the weekly budget.  But if that's your strategy, and the strategy does work, just plan on 100 bucks a week or $400 a month to market your business that way.
 
Jumping back to direct mail for a second, I wanted to touch on the numbers on everything we talk about here. Direct mail is generally a buck a letter. Just figure by the time you pay for postage, envelopes, and all that stuff, you're at a buck a letter. So, to market, if you send out 1,000 of them or 2,000, you can see how that would get expensive really quick. You could go with postcards instead of letters. The response rate is going to be about the same, and you save a little bit of money. But that's the numbers on direct mail.
 
Anyways, back to bandit signs. If you're going to do them, you can't put out 10. You have to put out a lot of them. You have to do it consistently, because they're going to get taken down, and you got to go keep putting them up. That's the other thing you've got to keep in mind with bandit signs, depending on where you put them, a lot of cities, the code enforcement officers are going to get after you. So if you are going to do bandit sign marketing, you're going to want to put a Google Voice number or some other number on the sign, so it's not your cell or home number. That way, if you get calls from the code enforcement guys, they don't know who you are. Just keep that in mind, they call them bandit signs for a reason! Good marketing, but you've got to be conscious of all that kind of stuff.
 
Facebook & Chatbots
 
All right, marketing strategy number 3. I see this a lot of people promoting lately on Facebook. They'll put a little ad in the groups and say, "I get 10 leads a day. Ask me how," or they're advertising the chat bots, or Facebook marketing, and everything in between. But what they don’t tell you is the cost. I’ve talked to people in depth about the chat bots, because I don’t use them and I wanted to learn the ins and outs. So I found someone proficient in it, a developer of the chat bots. I got him on the phone one day. I said “Tell me about this kind of marketing.” He told me, to have someone develop a chat bot for you will cost about $500. So, before you do any advertising at all, you are in 500 bucks. Then if you use a chat bot on Facebook, and you run ads, and people respond to the ad, your chat bot kicks in and starts asking them questions. “Do you have a house to sell?” It goes down a list of questions and fills in all the data for you.
 
Every time somebody clicks on that ad to use your chat bot, there’s a cost to it. So if you want a chat bot you will need a marketing budget to build one and run it on Facebook. Now, I’m not saying that they aren’t worth it or they don’t work, because I have never used one. But other than the people promoting them that are trying to sell them, “I get 12 leads a day. Ask me how,” I’ve never talked to anyone that was getting a lot of marketing from Facebook marketing or chat bots. Am I the expert in everything? Absolutely not. But in my opinion, that's not a great form of advertising. Instead of targeting your marketing at someone you know has a distressed house, you’re just kind of throwing the ad out there and hope someone sees it. I've done a lot of different kinds of advertising, and that type of advertising never works well for me.
 
So, chat bots will cost approximately $500 to get started, and it's going to be an ongoing cost every time somebody clicks on that and starts filling it out. That is the same with any kind of ad you run on Facebook. There's a cost per click on doing that, and that cost will depend on the keywords, market you are going after, and other factors. You can try it if you have the money for it, but I would try something else.
 
Facebook Groups & Craigslist
 
Facebook groups and Craigslist is a way to post online without having to pay for advertisement. You’ll see some people post on craigslist, “I Buy Houses” ads or, “We buy houses for cash”. People will put those same ads on Facebook groups, like local groups in your area such as buy/sell/trade groups. I have tried the Craigslist ads myself. It not something that is going to make your phone ring off the hook. You aren’t going to post a “We Buy Houses” ad on Craigslist and then have calls come in all day and night. That doesn’t mean it isn’t worth doing though!
 
If you're in the business, it's free, just do it.  Jot it down on your daily itinerary after your cup of coffee in the morning. Wake up, make a pot of coffee, and go put an ad on Craigslist. Even if you don’t do it every day, if you do it every other day, or once a week, it doesn’t hurt. If you get a deal every couple of months from it or just twice a year, and make 8-10 grand on a deal. It’s still worth doing, right? It takes two minutes and once the ad is on craigslist you just have to click renew. So it is worth doing, but with Craigslist and Facebook group advertisements, don’t expect a ton of responses. It’s all the little things you do combined that will get your business and bring it in. If it’s free, I would do it.
 
MLS Properties
 
Something else I see a lot of people talking about is, "Can I wholesale properties off the MLS?" Now, I've worked with a lot of realtors that were heavy in the investing business, but I never tried this strategy. All the investors that I know that either buy to have as rental properties or they buy fix and flip and all this stuff, they already work with realtors or are realtors. So they all have access to the MLS. If I go take an MLS property and take it to them and say, "Hey. Look what I found," they're going to say, "Yeah. I saw that two months ago. I wasn't interested in it." To me, as a wholesaler, you don't bring any value to anybody bringing them MLS properties. If you're working, if you've got a list of cash investors, and you're bringing them MLS properties, you're not doing anybody any good. You bring value when you bring them an off market property that they wouldn't have known about without you bringing it to them. So, MLS, I wouldn’t do that.
 
Now, you also have the MLS expired listings. I think people talk about this because that's what they always teach real estate agents to do to get more business. Their brokers will say, "Oh, yeah. Go out and call on expired MLS properties. Print a list out and call on them." First off, you've got to have a realtor that will print you a list of expired MLS properties, and I’d imagine you would have to have a pretty good relationship with them before they do that. It might work, they're expired for a reason. It could be they were inflexible on price. They wanted top dollars, and they couldn't get it, so they just let it expire. Just remember, it didn't sell for a reason. Typically, that reason wasn't because it was so distressed it didn't sell, because it wouldn't end up on the MLS anyway. The strategy is something you could try, if you've got a buddy or a friends that's a realtor. You could call on expired MLSs and see if it works for you. Personally, I wouldn't spend a lot of time on it, but if you can get the list, it's free marketing, so you might want to give it a whirl.
 
Now, there was one group of investors that were successful with MLS listings that I knew of, but they were partnered with a broker, and that broker would send out 50 offers a day for them. What they would do is they would print a list of all the properties on the MLS that had been on there over 120 days or a long period of time. Then they would send offers at 50% of the price. They didn't even have them pre-screen the properties. They just said, "Any one that's been on there over 120 days, send them an offer for half price."
 
Then if the offer got accepted or they countered, they would take a look at the property. They would go and check out the property, "Okay. It's in an area we want. It's the bedrooms we want. It's all the stuff we want." Then they would decide if they were going to move forward with it. But for that strategy to work, they were sending out a lot of them offers. They would send out 50 a day or something like that, about as many as the broker physically had time to do. That's another option, if you have the network, the realtor, they want to spend the time doing it, you could try it. It might work.
 
FSBO'S
 
Number six on my list is for sale by owners. Back when I was in the mortgage business, somebody told me to call on for sale by owners, because you can go in, help them kind of market the property, make flyers up for them that would tell potential buyers what the payment's going to be, etc. I've found owners of properties that decided to sell them FSBO, very hard to work with. It seemed that they always thought their property was worth way more than it was. Many of them had a type A personality and I found them to be more difficult than your average seller. I've called on some for sale by owners in the wholesaling business, and I've never done a deal off of one. I’ve just never had much luck with FSBOs.
 
Now, again, that doesn't mean nobody has success with it. Right? Because what doesn’t work for some people, might work for others. But it doesn't work well for me. Unless you see a house that's in distress, it needs a lot of repair, and there's a for sale by owner in the window, I might call on that. But if it's a pretty little house and it's just got a for sale by owner sign on the perfectly landscaped yard, I'm not calling it. I'm driving right on by and checking out the neighborhood for a vacant house. For sale by owners, see what your luck is with them, but me, I haven't been very successful with it.
 
Bird-Dogs
 
Number seven, bird dogs. For those of you who don’t know, a Bird dog is somebody who goes out and does driving for dollars for you or lets you know when they see a potential property. I looked at this early on in my wholesaling career and I didn't really pursue it that much. My thought was, "You know, if somebody's motivated enough to go out and bird dog all day, then it's not going to be too long before they're just a wholesaler themselves. Why am I going to train somebody, put all this effort into them, if they're just going to go and be my competitor eventually?"
 
But things have changed since I started in wholesaling. There are a lot of Lyft drivers and Uber drivers out on the town driving around. Recently I did a video on DealMachine, the driving for dollars app, and you can upgrade your system with them and add on bird dogs. They might call it something else, but you can add bird dogs to your system, and you can actually market for Uber drivers and Lyft drivers. You would say, "Hey, team up with me! While you're out driving, if you see a vacant property, you stop and with your phone snap a picture of it, and I'll pay you on it."
 
I think typically a bird dog fee, for at least me when I've paid people to go out driving for dollars, is about a buck a property. That’s what it costs me to mail to a property, so I think that’s fair for somebody if they want to go out and find some. So if you don’t have a lot of time to get out yourself but you want someone to go out and find properties for you, I’d look at DealMachine and Uber and Lyft drivers. You could even put ads on Craigslist and see if you can recruit drivers that way if you have the money to spend on doing that. (Check out Deal Machine Here)
 
Attorneys
 
Number eight, Attorneys. A lot of people say to market to attorneys. Market probate attorneys, elder law attorneys, divorce attorneys, bankruptcy attorneys, etc. This strategy kind of goes back to direct mail. If you can get a list of all these attorneys and you want to mail them, you will probably get about the same response as a direct mail campaign. I'm going to guess it's going to be in the 1% to 2% response range. If you're going after an attorney's business, I would suggest that you're very professional. You should have a website, business cards, and maybe you have a letterhead, because an attorneys going to want to deal with somebody that's very professional. Maybe you even already have an LLC set up for your business. However, that wouldn't be my first line of marketing. I'd go with something else before I started going after attorneys. Again, when I was in the mortgage business, I would market to attorneys and I had fair response with it, but it's just something you need to work on. Bottom line, don't expect crazy results from mailing to attorneys.
 
Wholesaler Websites
 
Number nine is websites. Now, I think everybody in the business should have a website. If you're a professional and you're in business for yourself, you need a website. Everybody's got a website these days. InvestorCarrot has my favorite website, but there are others out there. Now, getting people to your website, that's a different story. You're going to do that in a couple different ways. One is going to be through pay per click advertising. The other one's going to be through SEO or search engine optimization. That is why I like InvestorCarrot, they are good about teaching people how to do SEO.
 
Let’s talk about pay per click real quick. I did pay per click advertising for years, and I know a little bit about this. In the real estate business as an investor, wholesaler, or whatever, there's a lot of competition. Because of that, the pay per click ads are costly. I haven't done it in a long time, but I'm going to guess depending on your market, you're going to be anywhere between eight bucks and 25 bucks a click. Depending on what your conversion rate is after somebody gets to the website, you might have 10 people click, but only two people fill out your form.
 
So, if 10 people click on your ad, and its 20 bucks a click, you're talking about $200 to get two leads. Now, if one of those leads turns into a deal, it can be well worth it. But you can see with pay per click it is possible to blow through a lot of money really fast. While people sitting at their computer start clicking on your ads, the little counter's counting, and Google's going to charge your credit card. You need a big budget before you start playing with this. Go out and do some deals, and have a few thousand, 5,000, $10,000, in the bank before you start playing with pay per click ads.
 
Now let’s talk SEO. SEO on the other hand is a great way to get people to your site. Chances are if you've come across my site The Wholesaler's Toolbox, you've found me through SEO, because I don't pay for advertising on it. For example, you jumped online and Googled, "Wholesale real estate contracts," or something similar, and you've run across me. That is a good and free way to promote your investor site. So, if you were in Chicago and you’ve got a website up and running, and it is We Buy Houses Chicago, you would start adding blogs about different neighborhoods. Sell Your House Fast in Lincoln Park, (I believe that’s a Chicago neighborhood.) You write different articles like that, that would pertain to your audience and website. And now over time, those posts and your website will start to move up in the rankings.
 
It works! Because it's a specific keyword, or a long tail keyword as they say. If you write the blogs correctly, you'll show up in the search results. So, when people in Chicago, or whatever city you're in, start Googling, "Hey. How do you sell my house fast in this city? How do I sell my house without a realtor?" Your website will show up. There are a lot of different keywords that you will write articles around using the city name in the article. This will start to give you generic/organic traffic to your website. Once at your website, they’ll fit out the form, and you’ve got leads.
Now, SEO isn’t quick. It's going to take a few months, six months, or however longer for your articles to start ranking well on search engines. But even if it takes some time, it's a great way to get leads. You should have a website for your business anyways, so I would recommend working on SEO. Again, if you’re looking to start your website, InvestorCarrot is about $49 a month and they offer a lot of tutorials and webinars to help teach you how to build your online presence with your website. It’s definitely a good route to go!
(You should have an Investor Carrot Website for your business!)
 
Driving For Dollars
 
Now lastly, this is my favorite marketing secret. I know I talk about it a lot, but once again, let’s talk driving for dollars. If you're new into wholesaling, you are just starting out and don't have a big budget, you need to get out and drive for dollars. Driving for dollars, I've got another video on it that I'll link below. But driving for dollars, you just hop in your car and start driving neighborhoods. Get a map, so you can highlight where you've been, and start driving up and down neighborhoods looking for vacant houses. If you find a vacant house, you put a letter on the door. You can mail to the owner too. You just look up the owner either through county records, or on the DealMachine app, or whatever method you prefer. You can look up the owner and if they've got a tax billing address other than the vacant house, you can send them a letter. You can look them up online if you prefer to go that route, and message them on Facebook or LinkedIn, wherever.
(LINK TO DRIVING FOR DOLLARS VIDEO)
 
Just reach out to them and say, "Hey. I'm an investor in your area. I'm interested in buying houses in the area. Do you want to sell yours?", and just start a dialogue with them. Other than gas money and the money to print off the letters you are putting on the doors, you can get started in wholesaling driving for dollars for very little money. Now, if you want to start mailing to them, it's going to add some more costs, but maybe offset the cost by mailing only to the ones that it looked really distressed. For example just mail to the ones where the grass is three foot high or the windows are boarded up. Driving for dollars, in my opinion, is the number one way to get going in wholesaling.
 
Now, we talked about a lot of things. We’ve discussed Facebook ads, and direct mail, and all these different marketing strategies. Here's what I want to tell everyone reading this, you can't kind of wholesale. You can't kind of market. If you want to do well in this business, if you want to start closing some deals, you have to market a lot. Some of these strategies are free, and some cost a lot, but whatever you choose to do, go all it. If you want to drive for dollars, go to as many houses as you can in a day. Take 5 hours to get out there. If you work mornings, head out in the evening and drive until its dark outside. Do 50 or 75 houses a day. A lot of people will tell you, “Hey, I got out and did driving for dollars today, I left letters on about 6 or 8 houses.” That isn’t enough, and it won’t get you the responses you need.
 
If you want to be successful, you got to do a lot. If you want to do bandit signs, you've got to do a lot. If you're going to do mail, you've got to do a lot. You can just sort of do this and be successful. You might sort of do it and get lucky on a deal once and awhile. But if you are looking for long-term success, you need to keep at it and do as many as you can. So pick the marketing method you feel you can do a lot of, and hit it as hard as you can. That is what this business is all about.
 
I hope this helps clear things up on some of the different marketing strategies. If you have any questions, please put them in the comments and I’ll try to answer them for you. As always, you can go to my website, TheWholesalersToolbox.com, and look around. I have a lot of good information there, including all the tools that I’ve mentioned, free real estate wholesaling contracts, and much more. So I’d love to have you stop by and check out my site. You can also check out my YouTube channel and subscribe to be the first to know about any new videos I put out. (YouTube Channel)