Case Study – Results From This Investors 1st Mailing

Investor Spotlight

Issue #19

Featuring Tony Michael

4 deals w/ a 2,500 piece mailer

 

Tony has been in real estate for almost 4 years in the Clearwater Florida market. He’s primarily flipping, doing 12-15 deals a year but lately has been holding onto big 6-figure deals due to the capital gains tax. He also ventured into the Airbnb space, and owns a lending company. 

He said this about his business strategy:

Single-family is my target and it’s all about quality over quantity for me. I’d rather do 5 flips a year and make 100k on each than flip 25 homes a year and make 20k on each. We focus on large exit, SFR’s

The Seller/Deal(s)

This one mailing produced for him 4 deals (this is not the usual case in direct mail — typical cost per deal is usually $2,500-$3,500+ depending on your market). He netted a whopping $337,000 on this and one deal that will cash flow $2,00o a month.

Since all 4 deals are worth mentioning, let’s dive into all of them

  1. First seller was going into foreclosure and needed an out, and Tony’s mailer landed at the right time. This one took about 6 months of bi-weekly follow-up (texts, phone calls) to finally have her sign
  2. Second seller sold because the cost of living and her medical conditions made it hard to afford a house payment. The mother was also a decision maker and wanted to sell to us because of our reliability and professionalism.
  3. Third deal too 7 hours to lock up.  The seller was going to lose the house in 2 weeks and had already gone through a failed MLS listing. The gentleman was a prior marine and resonated with me being on active duty — Shows how much rapport matters for closing deals.
  4. Fourth seller turned out to be a retail referral that Tony sent over to his Realtor contact. Tony made $1,000 on a “marketing/referral” fee.

Tony found these motivated sellers using handwritten direct mail

Here’s what sellers said about why they called Tony (in some form or another):

“I receive so many mailers to buy our home over the years but appreciated that you took time to “hand write” me a letter rather than send me a scripted one.”

 

 

 

The Marketing

  • How many letters sent: 2,500
  • The list: High equity, Less than 500k current value , At least 30% equity , Single Family, Min 2 bed 1 bath, Built after 1960.
  • Mailing piece: The limited edition Summer Mailers

The Numbers

  • Total net: $337,000
  • Deal break down:
    1. Net $33k and sold in 41 days. Zero rehab.
    2. A full rehab gut cost $45k. Will net $88k.
    3. Homerun deal that will net $215k:
      1. PP= $115k;
      2. Rehab = $15k;
      3. Appraised for $330K.
      4. Corporate rental cash flow = $2k a month.
    4. A $1k referral fee.
  • Cost Per Acquisition: approx. $906 (Again, this is not typical. We see a CPA of $2,500-$3,500+)
  • Total ROI (taking into account all deals made in 1 mailing and a 6-month timeline) = 1,354%

(here’s proof of that ROI):

 

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