Real Estate Investors have long found that Absentee Owners are prime suspects when seeking off-market deals. Let’s talk about how to build the right Absentee Owner list for your campaign. First, let’s ask:
What is an Absentee Owner?
Pretty simple, it’s someone that owns property that they don’t live in. They have a different primary address where the tax bill is sent. These owners could live in the same area or across the county.
Now let’s talk about:
How to build the best absentee owner list for your campaign.
#1 – You should work with a mailing list broker
They can answer questions about how the list is compiled. Additionally, they can make suggestions for your investing strategy and market area. (I may have a bit of prejudice in this regard) Once you provide basic information, they will run a count report for you to look over and decide if you want changes.
#2 – Decide how many names you want to mail to.
Your printing and postage budget will help determine this. However, you need to be aware that this is a numbers game. Consider that you should be sending out 1000 or more. You can split your mailing into smaller pieces (say 250 at a time). Plan to get the full list to avoid minimum order charges.
#3 – Define your REI market area. Where do you want to buy property?
You might need just a few zips or multiple counties. This will be dependent on the population/housing density. The number of criteria used to limit your list will also be a factor.
#4 – High Equity Absentee Homeowners are recommended
Equity is calculated using Loan to Value (LTV). This compares the full, original amount of their mortgage to the current home market value. Unfortunately, the current loan balance is unavailable because it is credit bureau information. As a result, LTV doesn’t take loan payments into account.
Be aware that not all areas have good reporting on the loan information required to calculate LTV. This is where a list broker can come in to offer suggestions.
#5 – What sort of property do you want to buy?
Most investors are looking at the simplicity of buying single family homes. Others, based on their market and investing strategies, might want to add in condominiums and multi-family homes.
#6 – What do you want for a Home Market Value?
Real Estate Investors need to look at their market to learn the median or average home value. Your list broker can also help you with this. Your investing strategy and availability to funds (or buyers) will also be a factor here.
#7 – How long should they have owned their property?
The purchase or transfer date can be a tricky bit. Most investors have found that it’s best to target people who have owned at least 5 years. However, this can be another case of incomplete data from the counties. Your list broker can help with this as well, so you don’t lose out on contacting owners that might have been missed by other investors.
#8 – What about the owner’s age?
You might consider age 40+ because younger owners can tend to have long-term plans. Some investors feel that it is better to specify 60+. It all depends on the size of the list and your preference.
#9 – Specify a minimum number of bedrooms and bathrooms.
If you are in a market where the 3+ bedroom and 2+ bathroom homes are the only ones moving, you’ll want to include this. Be aware that this is another area where counties vary on how completely they report this information.
- Consider what to do if your list is too small
As we have said above, this is a numbers game. Expand your market area. Loosen up on your criteria. Combine with another list with owner occupied. (Seniors with Long-Time Ownership is a good list of motivated sellers)
- Consider what to do if your list is too big
Decide how many you will be mailing out over the next 3 months or so. Your broker can take a proportionate number from all segments then eliminate those owners from future purchases. Alternatively, you can narrow your geographic area and tighten your criteria.
Get started – Learn more about our Absentee Owners List and complete the form to get your initial count report.
Along with pulling your list of absentee owners, you will want to plan your mailing. There are several options from designing your own custom letter or post card to using a turnkey site where you choose from templates, send over your list and they get it in the mail.
Once the mail goes out, have a plan for how to convert owner phone calls into a property purchase.
