Welcome Back to the Discount Property Investor Podcast Episode 13! Thank you for sharing some time with us today. Today the hosts discuss Driving for Dollars. The process of Driving for Dollars is simple and a great way to find motivated seller leads at a very low cost.
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Mike: Alright, discount property investors, welcome back to the Discount Property Investor podcast episode 13. Your host Mike Slane and David Dodge, we just want to thank you for joining us. Remember, if you are looking to get started in real estate investing, specifically wholesaling, please check out our freewholesalecourse.com, at freewholesalecourse.com. That is everything you need to know to get started in real estate wholesaling. So go check that out. Or check us out at discountpropertyinvestor.com.
Today we are going to talk about driving for dollars, Dave? What do you think man?
David: Driving for dollars is awesome man, it’s a great way to get started, very little cost and —
Mike: Exactly, so — it is marketing right?
David: It’s marketing. Absolutely.
Mike: The whole of real estate investing is marketing and this is a way to go out there and generate some leads for yourself that might not necessarily be out there for everyone else. I think it is one of the best ways to — generate leads.
David: Absolutely, we emphasis in — recent episodes, start in your backyard. You don’t need to try to do deals 100 miles away. You are just getting started and want to start wholesaling. Start in your backyard; start in your community and driving for dollars is a perfect way to get started in your backyard.
Mike: Absolutely, if you don’t have any experience in real estate, I mean really get to know your community a little bit better by going out there and driving through.
Mike: So what is driving for dollars then? Dave do you want to give a brief definition of what driving for dollars is?
David: Yeah absolutely. So driving for dollars in its most simplest form is driving around, it’s looking for properties that have been neglected, maybe vacant, have tall grass in their yard, maybe boarded up windows and doors. Just properties that need work, properties that have been neglected and it is a great property for you to then dive into and figure out who the owner is.
Mike: So first step is you are going out in a target area — I recommend to limiting it to one neighbourhood or subdivision at a time to — make it palatable for yourself. So you are going out there and looking for — I always consider it vacant properties, but distressed properties, or another one you can go ahead and write down –. You are going to get in your car and I would recommend using an iPhone or your phone rather and making a little google spreadsheet. Just typing in the addresses that way, or the notes or whatever. If you want use a notebook. But you are going out there collecting information, you are finding these properties that look like someone isn’t living there or somebody who is living there isn’t taking care of that property, so there might be some motivation to sell.
Mike: You are basically going out and compiling your own list of distressed properties.
David: In doing this — is very simple actually. When I started wholesaling a little over a year ago, I was driving for dollars every day and — I remember — I would go out for an hour at a time and I would come back with 30 or 40 addresses writing down. It’s crazy to think about that looking back like — you can drive around and find 30 or 40 vacant houses in an hour and I was in good neighbourhoods.
David: Or houses that just looked like they needed a ton of work.
Mike: It’s a combination of things. You have an aging population, so maybe they have moved to — a senior living community something like that, the kids come over and maintain it once and a while or there is no one there to maintain it ever. So it was just a property they were not planning on selling, maybe mom or dad plan on moving back into the house, who knows. But again there are tons of properties, even in good areas. That is a really good point Dave. It’s not just the distressed rental lower end areas that there are vacant houses, they are all over. So then what do you look for? Dave kind of mentioned taller grass — that is a great one in the spring, it is kind of a dead giveaway when you see the taller grass for sure. What I like to look for too is — especially if you are able to go around behind the flier guy putting the Chinese menus on the door or the local ad that is on the door. I like to look around for houses that have those on them. Because, if there is ten houses in a row where that is not there and one house has it. Well it means someone hasn’t opened that front door whenever the other ten houses in that neighbourhood have.
David: A very good point.
Mike: So I think they are a good giveaway or something that I look for when I am driving for dollars. The third one then would be snow. Again if you are in an area that snows that is something you can look for. Four wheel drive go out the day after it snows and see who has shoved the driveway and who hasn’t. That is another way to see if that may be a property that someone isn’t living in.
David: Similar in the fall if they haven’t cleaned up their leaves. Mike: No, that’s my house to. So same again, you are looking for all sorts — what would be a tell that the house is vacant, all these things are kind of things to look for. In addition to like David mentioned, just neglected properties, ones that just — the gutter is falling off and who knows, all sorts of things to show the age or neglect of the property. So that is basically what you do to get started. So what’s the next step Dave? You went out and you got a list of — these properties that you think are vacant or neglected, what do you do next?
David: Yeah so when I first started I would go out like I said, I would go out for an hour, two hours at a time, I didn’t spend a ton of time driving necessarily. I would just get a decent list of addresses and then I would go home and look on the local tax record site. So every should have a site that you can look at online and look up addresses to get owners names and mailing addresses. So there a couple of third party software’s that you can subscribe to and pay, which will help this process and speed it up. But you don’t need those services; you can get all this information for free. So here in St Louis we have St Louis City and St Louis County, and of course we have St Charles County. Each of these different areas have different websites that you can go, you can type in the property address and it is public information, so you are not doing anything illegal or shady here. But you can see how much the property owes in taxes, you can see the last time they paid their taxes, you can see who’s the owner on record. It could be a name or a business name. But that is kind of irrelevant. Then you can get the mailing address of the individual that owns it. So what you are really looking for here is you are looking for a mailing address that is not the same as the property address. Because if the house is vacant and the tax records showing that the mailing address is the same as the property address and you have mailed them a letter or postcard — well you a mailing a letter or a card to a house that is probably not going to get it.
Mike: That is a really good point. Those are the real gems as well when you find one that has probably changed the mailing address somewhere else.
David: Now you can still mail them because as Mike said a couple of minutes ago, maybe the kids of the family or whoever comes over once a week or every couple of weeks —
Mike: — picks up the mail.
David: A complete waste but I will always look for, what we like to call absentee owners. So you have a different mailing address from the property address. Then from there you just put together a spreadsheet — write down the name of the owners and the address of the properties — this is kind of — not necessarily time consuming but you are going to spend a little bit of time going through and typing in these addresses. But it is a great way to get leads for very low cost.
Mike: Absolutely. I think they are pretty high quality because again it is a list that there are not another ten guys in your local market —
David: It’s a list that you are generating, you’re not buying it. If you buy it that means anyone can buy it. So you’re generating it and you can target the zip code or area and the neighbourhood really well. So anyway, you go ahead and create a spreadsheet and write down the name of the owner, the address and then from there you just start mailing. When I first started I was writing letters by hand — I went up to OfficeMax and bought a bunch of yellow pads of paper and — I didn’t have a ton of money so I was just writing letters with a marker saying — Hi my name is Dave, I see that you own this property, I put the property address and — I am in the market to buy a properties, I’m an investor, call me.
Mike: I can’t tell ya how many of those I hand wrote —
David: Hundreds, thousands of them.
Mike: Way too many. Then I got wise and started copying them — then getting someone else to mail them. It’s all progression.
David: It’s all progression, but in the beginning just write —
Mike: The cheapest, easiest way — go out there, find a couple of properties that you think are vacant, like Dave said you write them down. Look them up in your local county assessor’s website, find the mailing address and write them a letter. Just say, hey noticed this property may be vacant, was just wondering if you are interesting in selling it, I am interested in buying it.
David: Simple as that.
Mike: You don’t have to over complicate it. So driving for dollars, I am not sure if there is anything else we can really delve into at this point, Dave? Any other thoughts on it?
David: Just keep it simple folks, don’t over think it, get out there, drive around, find some properties that look distressed or vacant or whatever and they need work and note down the address like Mike said.
Mike: I just thought of something.
David: What’s that?
Mike: So when you are out driving for dollars keep your eye open for rent signs, write those down.
David: Great idea.
Mike: For sale by owners, write those down, or just call them.
David: For rent signs actually are really good — I love calling — when I see a rent sign I still to this day pick up the phone and call them. Maybe 70 or 80% of the time they are just looking to rent it which is fine. But one or two times out of ten give or take, you call them and say, hey I see you have this property for rent — are you looking to sell? Are you interested in selling? They may be tired of being a landlord, they may just want to dump the property and get rid of it. Make for great leads. That is a really great point.
Mike: When you are out there again, keep your eyes open and for sale by owners are great, rent signs are great, and — you are going to come across a ton of them so. Just get out there and do it, I think that brings us to our action item for today, which I would say is get out there and do it. Find a vacant house and look for the owner.
David: You don’t even need to drive necessarily. I read blogs all the time where people that just do a daily walk with their dog in the evening and they will walk by a house for three months straight and they won’t see any cars in the driveway. They will look up the address of the owner, write them a letter and boom; there is a $10,000 deal right there.
Mike: The last house I lived at, for three years I walked by this house. I mailed them probably every six months or so — still haven’t got a hold of them.
David: So keep mailing them.
Mike: I will, drives me nuts.
David: Eventually they are going to need to sell it, so.
Mike: Great leads, and again if you can get a hold of that owner, they can definitely turn into profitable leads. Alright guys, do you want — Dave do you want to wrap us up with our ending thoughts.
David: Yeah absolutely, check out the freewholesalecourse.com, we are always pushing people to check that out, tons of value there — we want to help you get started in wholesaling. That’s — our main point and also if you are looking for properties in the St Louis area, discountpropertyinvestor.com, there is a link in the top right hand corner where you can subscribe and — our contact information is [email protected]
, as well as [email protected]
if you want to reach out to us, we would be more than happy to communicate with you via e-mail — that’s about it. Our ending quote for the day, Mike do you want to go ahead and read it for us?
Mike: Sure, “You only have to do a very few things right in your life, as long as you don’t do too many things wrong.”