Driving for dollars is one of the most cost effective ways to find real estate deals.
Drive around neighborhoods and look for homes that appear to be vacant, in need of repair, or even for sale by owner.
Watch as Mike Cowper talks about driving for dollars for real estate deals.
Transcript:
Chris Bounds 00:00
Your market, everyone’s market, it’s all- it’s gonna be different. Like the Houston market is gonna be different than maybe a small local community and flyover country or if you’re investing in San Diego. It’s all gonna be different. But um, what are a one or two channels that someone starting out with a more, more limited budget, or maybe even no budget? What are some of the channels you’d recommend?
Mike Cowper 00:25
The two things that I think would probably be the most easy entry point, I mean, it takes a little bit of time and energy is driving for dollars, you know. People tend to get lazy and don’t want to do the work. And I can’t blame, right, I don’t want to go and drive for dollars anymore, because I can afford the different marketing channels. But, you are typically out. I mean, a little bit different now with COVID.
But, you’re out in your car typically often a lot of times, and if you’re already going to visit sellers, and you’re already have appointments scheduled, why not block off half hour before and after, or before or after 10 minutes, and cruise around some neighborhoods.
Now, you know, there’s certain things that you want to look out for and distress points. And you also wanna make sure you’re going to neighborhoods that have a higher likelihood of having those, you know, types of distress points, right? For example, I’m not going to go to Detroit, I don’t invest in Detroit, and I can find, you know, 100 houses that would fit distress signaling.
But, I’m also not going to go to, you know, Rochester Hills, which really lush area, where there’s a very low chance of there being distressed homes. Yes, I might find one, but what we’re trying to do is almost like the 80 20 rule. What is our highest likelihood of finding opportunity, not looking for that diamond in the rough. So, I think that drive for dollars is a great technique, it’s pretty simple, you just find the houses that look like they either meet a lot of work, there’s city tags on the front door, windows are boarded up, if you’re in a snow state, you know, and it snowed a week ago, and there’s no tire tracks in the driveway, you know, signs of vacancy signs of, you know, that really downtrodden not not just kind of, it’s a little bit disheveled and the roof is kind of peeling, like that’s not a driving for dollars lead.
But finding those people and then just trying to stay in touch with them reach out. And you can look up most people’s information on public record, which is accessible to everybody with their you know, tax mailing addresses. You can send a letter very cheap, you can either handwrite it or print something off and sign it and send it right from your house at night.
You can also go one step further and use some free or cheap resources like you know, whitepages.com, or you can go the level of skip tracing those people to find out what the phone number is, and just give them a call say, “Hey, what’s up man? I saw your house thought I’d be interested in buying it, you have an interest in selling it”. People sometimes overcomplicate it, we’re not trying to convince anybody of anything, we’re trying to find the people that are ready to raise their hand and sell their house.
And I think sometimes that gets people in their head, they’ve got to try and convince or trick someone into doing something they don’t want to. At the prospecting level, we’re just trying to find opportunity. And we’re not trying to convince anybody of anything, we’re looking for signs of motivation and seeing if we have an option to help them.
Chris Bounds 02:46
Yeah, having an open conversation with folks and just seeing where that leads.
Mike Cowper 02:49
Yeah. And so the other way that you can go about this too, is if you’re gonna have a little bit of a budget. I’d probably try to niche it down as easy as possible, right? A lot of us as you scale up, you start going towards, you need bigger lists to mail to generate leads you want. So we’ve done a lot of equity mailings, but there’s no true motivation signal there.
What I would recommend for you we’re getting started is really, the riches are in the niches. That’s something that’s been going around for quite some time. But you know, trying to hit the “Notice of Defaults” or the “Pre foreclosures” or, you know, “Divorces”. Like try and find opportunities or probates, you know, find the opportunities that are out there that are part of public record that you can pull from your cities to your counties, and then same idea, you can send them a letter from the public records, or you can do some of the deeper level interests of skip tracing or you know, identifying their contact information, and just reach out to me directly.
The reason I’m so interested in, you know, mail, calls and texts, and emails, if I can get them is because everybody responds different ways, right? Think about yourself. Some people really only like to talk via text, some people only like to talk via phone. Some people like to write letters, I don’t know who those people are anymore.
But, there is a segment of people out there, right? So, you know, if we can hit them from all different angles, we’re again increasing our opportunity for people we’ve already identified in areas that we’re wanting to buy. And then now we’re going to try and communicate with them and whatever method works best for them.
Chris Bounds 04:08
Yeah, the omni channel approach where even if you hit them through direct mail, just that psychological branding as it sinks in and then now you’re everywhere. When that thought comes across their mind. You’re now the solution.