Yes, you’ve read that right – we will talk about letters. There is such a thing as a real estate investor letter and many businesses close deals on leads obtained through these letters.
While most of the communication for finding motivated sellers is done digitally (social networks, email marketing, Google Adwords, etc.), the success of traditional methods, like yellow letters, proves that direct mail marketing is not dead. So if you think letters are outdated, rid yourself of the prejudice and check out how you can utilize them.
In essence, a yellow letter is a handwritten prospecting letter. Real estate investors send them to find new leads. It’s called “yellow” because of the legal pads (yellow color paper) that are often used in these campaigns. The informal and unassuming paper along with the handwriting, both visible through a standard white envelope, help to improve the response rate, since most people end up opening these types of mail. If nothing else, we are all curious.
Not all direct mail letter campaigns involve a yellow letter, but every yellow letter is a direct mail.
The reach of these yellow letters is not to be underestimated, especially since the open rates for email marketing fluctuates – probably because the novelty of receiving an email wears off over time. So, what’s the catch? Real estate investor letters are more expensive (sometimes more than $1 per piece) compared to a standard direct mail campaign, which, by the way, gets cheaper when you order thousands of postcards or mailers. However, the costs are justified, because letters are opened more than emails or postcards, and seasoned marketers launch direct mail campaigns because of this.
That’s why every real estate investor out there is after tips that will make sending prospecting letters both more effective and cheaper. Here is our take on it.
Real estate investor letters exist to open up a communication channel with a motivated seller. No one sells a house based on a letter – the point of these campaigns is to make the first step. Ideally, you would be able to build a relationship with the property owner, but that happens further down the line.
It’s a way to say: “If you need me, I am a phone call away.” So treat yellow letters as a friendly hello.
Maybe you did get the attention of the property owner with the envelope design, but you only have a few seconds to keep it. Make your copy short and easy to read. The common wisdom is to use only one page. It’s more than enough to include several paragraphs (up to three) and get your message across.
Yellow letters are used to evoke curiosity and to stir up emotions, but this doesn’t mean that you should write an original copy for each recipient. There’s not enough time in a real estate investor’s day for that.
How can you draft a letter copy that’s personal and standardized at the same time? It’s simple: group the recipients based on a specific feature, for example, they all live in the same neighborhood, or all of the contacts in the mailing list are underwater on their mortgage. And, to make it personal, leave a blank space where you can add the homeowners name, or the full address of the property.
A pro tip on incorporating personalized notes in the letter is to place these blank spaces at the end of a paragraph. This way, the format will allow seamless transition, and the name or the address of the recipient will not be cramped up or revealed as an empty spot in the body of the letter (you’ll see what I mean in the templates below).
Since the copy is short and standardized, you should set some guidelines on the content that goes in the letter. There are three elements you simply have to include in each yellow letter:
Give the recipient of the letter a reason to call you. Lead magnets are one of the oldest tricks in the playbook, and they work offline, too. The typical example is to drop an offer for a free property appraisal in the copy. It motivates property owners to pick up the phone, and with this particular lead magnet, you are practically invited to enter their home, which is a great start.
Opinions vary when it comes to the choice of envelopes, however, if you go for a blank envelope with a simple post stamp, you are distancing yourself from formal direct mail campaigns. Make sure to fold the yellow pad so that the writing is facing outward and is visible through the envelope. A handwritten note is a teaser for any recipient.
Although handwritten yellow investor letters are meant to be as low key as possible, direct mail marketing companies can provide you with copies and designs that work. These companies are helpful for real estate investors who intend to send thousands of letters.
Sure, you can DIY yellow letters with a scanner/printer (ink-jet), and you can hire a remote virtual assistant or college student to handwrite them for you, but the process becomes unnecessarily complex when you’re working with a large number of letters. You’d be amazed by the handwritten fonts available at professional print marketers, and they’re a lot more affordable for high volumes.
While data from marketing companies is useful, you can also track the performance of the campaign on your own. Split tests (sending copy A to one group, and copy B to another group) is the most simple way to do this. You can use two different phone numbers to monitor the success of each copy, and track which one got more calls. You can adjust the next campaign based on the results.
Have different templates for each type of homeowner you’d like to buy a house from. The copy can’t remain the same for probate proceedings, foreclosure properties, divorce, expired listings, etc. Don’t worry, we will share a number of templates with you in the next section.
Since it’s not easy to craft an original copy that converts, we are going to share with you 9 different templates that you can use as inspiration for your next direct mail campaign.
Remember, they are simply guidelines – there is no silver bullet when it comes to direct mail through yellow letters.
These are to be used when you enter a new market, or when you simply want to promote your business.
Dear [Owners name],
My name is [Name] and my company [Company] helps homeowners sell their property fast.
I know that selling real estate can be difficult, but I’m here to make the process easier. If you want to sell your house, I have buyers who are interested in properties in [Market].
I buy houses in any condition.
I buy cash, so the whole process can be over in a week.
The closing costs will be covered by me.
Call me at XXX-XXXXX-XXX if you have any questions,
Thanks,
[Name – signature]
Hello [Owners name],
My name is [Name] and I’m a real estate investor with [Company].
[Market] is one of the neighborhoods with high demand for houses, and I’ve noted your property in the listing [some time] ago.
I’ve checked the listing, and it seems that your ad expired, so I’m writing to offer my help. I know that it’s very taxing to try and sell a house within a short time frame. I have experience handling fast house sales in your area, and I can aid you to sell the property quickly.
I can find cash buyers, so if you are interested call me on XXX-XXXXX-XXX.
Best regards,
[Name – signature]
These are to be used with caution, because some might not appreciate you contacting them knowing they’ve recently lost a loved one
Dear [Name of executor],
Please accept my condolences on the loss of your loved one, [name of deceased.] Taking care of probate proceedings is difficult, so I reach out to you to offer my experience in handling real estate matters.
As the executor of the probate, you are responsible for the home of [name of deceased] in [city] – you can either sell it or transfer it to an heir.
It’s easy to sell a house if you are just moving your belongings to a different home, but to list a recently deceased loved one’s home on the market is devastating, so I understand if you haven’t made a decision yet.
Still, sometimes selling the house is the best way to let go.
If you are facing a time constraint, I can offer my assistance.
If you want to keep just a handful of household belongings, I can find professionals who can sell the rest of the belongings on your behalf or to donate them to a charity of your choosing.
The value of the home, with or without the belongings, will be determined by an attorney, so that you can be sure you’ll receive a fair market price.
I can send you an analysis of the value of the house in [city/address]. It comes without any obligation on your part and is offered to you free of charge.
If you have any questions, call me at XXX-XXXXX-XXX.
Yours truly,
[Name – signature]
Dear [Owners name,]
The economy has taken a hit in this crisis and homeowners are faced with tough financial decisions. My name is [Name], I am a real estate investor, and I’ve helped many people who were left to navigate through the foreclosure process on their own. Fortunately, there are alternatives to foreclosure.
I can be your expert throughout this process, since I’ve worked with homeowners who are underwater on their mortgage. I can find a cash buyer for your property – they will get a house without the burden of due balance and you will get a fresh start in a new home.
Call me on XXX-XXXXX-XXX if you have any questions and we can go step by step through the process.
Sincerely,
[Name – signature]
Hello [Owners name],
Divorces are always stressful, regardless of whether they were planned in advance or they came out of the blue. It’s even more difficult if you share ownership of the house you live in with your ex-spouse.
My name is [Name] and I’m a real estate investor with [Company]. Please allow me to offer my assistance in dealing with the property. I’ve done this for other houses before, so be assured that there are ways out of the situation.
Call me on XXX-XXXXX-XXX to talk about the steps that lie ahead and we can put together an action plan for selling the house.
I would recommend that you hire someone that has experience with shared ownership properties, even if it weren’t our company, because dealing with this problem requires a good deal of know-how.
I’ve helped others to sort out the problems with their marital home after a divorce, so you can give me a call.
Yours truly
[Name – signature]
This is the only exception to the rule of keeping the letter short, because these folks already worked with you and they are more likely to put up with longer letters.
Hello [Owners name],
I hope this letter finds you well!
[X amount of time] has passed since I helped you sell your house and buy a new one at [Market / full address].
Is your [hobby you’ve talked about] still taking up most of your weekends?
As you know, I follow the real estate market closely, and I’ve noted that there is high demand for houses in your area. They are going for as much as $ [highest listed sale price recently]. Are you interested in selling your home now, while the prices are up, for cash?
I would love to hear from you and discuss this in more detail. Also, you can pass on our offer to your neighbors – we give out $ [finder’s fee] for referrals.
Take care,
[Name – signature]
Hello [Owners name],
My name is [Name] and I’m a real estate investor with [Company]. Over the past [X amount of time,] I’ve assisted homeowners sell their houses in [Market / neighborhood].
I’ve recently helped someone that lives close to you at [full address] to sell a [number of bedrooms] home.
I have a couple of cash buyers interested in buying houses in your neighborhood, so if you want to get a free property appraisal call me at XXX-XXXXX-XXX. The offer comes without obligation on your part.
Kind regards,
[Name – signature]
Hello [Owners name],
My name is [Name] and I’m a real estate investor with [Company]. Each month we help homeowners in [Market / neighborhood] sell their houses quickly.
I buy houses in cash, so the whole process will be over within a week. I will buy your house AS IS – fixing is not required. There will be no realtor commission and I’ll cover the closing costs.
Our budget allows us to buy only two more houses in your neighborhood this month.
If you want your house to be one of those that we buy, call me at XXX-XXXXX-XXX to discuss the next steps,
Regards,
[Name – signature]
This one’s great for houses with FSBO signs or listed as FSBO.
Hello [Name],
My name is [Name] and I’m a real estate investor with [Company]. I’ve helped homeowners in [Market / neighborhood] sell or buy houses quickly – it’s what I do for a living.
When I see a FSBO house listing, I immediately know that you don’t want to deal with real estate agents. However, I’ve worked with many property owners, and I also know that it’s a tough market for those who want to negotiate a good price on their own.
Let me assist you with the sale of the house. I’ve got the experience, and you don’t need to pay commissions for the sale to me. In fact, you’ll probably get a better price than what you originally had in mind.
Call me on XXX-XXXXX-XXX to discuss an action plan on how we can make it happen.
Sincerely,
[Name – signature]
If you’ve done real estate investing for a while, then you know that there are all sorts of scenarios out there. Chances are, you choose your deals carefully (and maybe you specialize in some type of deals), so you’d need only a couple of these templates.
Write to the point to keep the attention of property owners and find a way to let them know that you’ll be of service to them. Professional printing marketers can help you create a campaign, but you must first have a clear idea of what properties you are after and what you want to say to your target audience.
Remember, people are vulnerable when they sell a home under these circumstances, and your yellow letter might be the first step that leads you to closing the deal. When you strike an emotional chord, the likelihood of the homeowner choosing you to assist in the sale process is higher.
Follow the tips we shared to develop your own template, especially if your type of deals weren’t covered. And test your copies in campaigns – it’s the only way to find out what works and what doesn’t.
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