And It Doesn’t Matter Whether You’re a Real Estate Investor or a Realtor…

Every now and then a member of my Real Estate Group asks this question: Is doing an open house more profitable when you do it as a licensed Realtor? I do open houses both as a Realtor, and as an investor in states where I don’t hold a license and my answer is:

I do both types the same way, no changes, and I always get traffic!!!

First, you must plan your open house at least 5 weeks in advance. This is not the time to do spur-of-the-moment things hoping for traffic. You must plan in order to generate traffic. I always do the following before I even schedule the date.

Here are 6 things I ALWAYS include to make my Open House work:

®    If your house is listed ask your realtor to supply you with the names and complete addresses (including e-mail and phone numbers) for all the realtors who have sold at least one home in your zip code or within 3 miles of your property (if the neighborhoods are similar). Then ask your realtor to break down the list to find agents who have sold 2 or more homes. Don’t worry, in most cases it is not more than 10 to 15% of list. My recent list had 235 realtors and only 28 had sold more than 2 homes.

®    I know what you’re thinking: I’m not a Realtor and don’t have access to the MLS. I am licensed in Georgia only, but have property in 6 States. If you have your properties listed your realtor can supply the info. If you’re selling them yourself just ask a Realtor to get the information for you. When I do it this way I pay $ 10.00 per hour. It takes about 8 to 10 hours depending on the size of your area and number of sales. This will be a very targeted list as all names will have sold homes in your area. And if you have ever bought a list from a names broker you’ll know this is a low price.

®    After I have the names I sort them into in two groups (2 saIes, more than 2 sales). Then I do the following: The large list I send to Handy Mailing (Call Julie at 316-944-2231; she handles most of my printing and mailing needs). I also send her the flyer I had made for my property. She prints and sends them to the names on the list so they arrive about 7 to 10 days before the open house. Then I have my web guru (Steve Tickner 941-228-7810) upload all the e-mail addresses into my web server. I send them emails at the following times: 2 weeks out; 10 days; 7 days; 5 days; 3 days; day before; and the day of the open house. I have the Realtor e-mail the flyer to their office and contact lists. I also upload the flyer to my social networking sites (like Yahoo and Face book) to let everyone know about my open house.

®    Now for the small list: this is the list of realtors who have multiple sales in your market. I have a 3 page sales letter I send telling them the reason I’m contacting them is that I know they are among the top sales people in the area and I want them to see my houses and bring me a contract. I offer the buyer a few bonuses such as $ 2,000 in closing costs and a home warranty. For the agent I offer them 4% commission and $ 100.00 gas card. Along with the letter I have mock checks showing them what the commission would be and a DVD of the house. (I have a DVD made of each house; cost is $ 99.00). The video company I use puts the DVD up on their web site with its own URL, so I go to Go Daddy and buy the domain name for my property. I always use the street address.

www.3021delmonicodrive.com

www.2880belvederelane.com

(The URL’s also go on all my E-mails and social media sites). I send this packet to the top agents so they get it between 7 and 10 days before the open house. Remember, they are also receiving the Emails as well. Right before the scheduled date, I call each one of the top Realtors to see if they got the letter and answer any questions they might have. I personally ask them to please show and sell my home.

®    Another media type I make use of is the local paper. Most of the areas I have homes in have a number of papers, and I usually choose 2. I include the number of bedrooms, baths, address, open house hours and the web site address. I also buy extra 3 lines on top and 3 extra lines on the bottom and bold the whole add. This way it’s bigger than all the other ads and stands out.

®     And the final thing I do is put out signs. I use a combination of hand-written and pre-printed. I like to use the arrow open house signs that are pre-printed as they stand out better and the ‘sign police’ leave them alone. I usually put the signs out late Friday; you need to do what is best for your area. I also display a 4 x5 banner on the house on Wednesday before the open house date.

These actions and your advance planning will drive traffic to your open houses, whether you are a Realtor or an investor.

 1181 South Sumter Blvd suite 301 North Port Florida 34287 941-716-2597

695 Mansell Road Suite 120 Roswell Georgia 30076 678-287-4800

Paul J Da Costa

Is a licensed Realtor in Georgia. He is a Real Estate investor, educator, and national speaker.

Paul is available for select speaking engagements and can be reached at

941-716-2597

www.pauljdacosta.com

paul@pauljdacosta.com

I sure hope not! But we are going to tackle that here.

One of the reasons you must know the cost per day (CPD) is to know how much of a penalty to charge your vendors if they don’t perform duties on time.

I understand some of the experts say just figure $ 100.00 to

$ 200.00 per day. I disagree with this because each investment will cost a different dollar amount and your financing may also be different. Also when a vendor asks where you came up with that number, what will you say? Yes. I know you don’t have to answer but it’s important that you know it.

All you need is a spreadsheet program, like Excel. If you would like me to send you the one I use, just forward me an e-mail with your complete name and e-mail address.

You should include the following items. You may not need all of them in every case, depending on your deal. I calculate all my deals based on a 90 day ownership.

§  Cost of home.

§  All closing costs.

§  Rehab costs, all vendors

§  Insurance cost.

§  Yearly Taxes (divided by 4).

§  Interest on borrowed funds (divided by 4)

§  Lost interest on your cash funds (divided by 4)

§  Lawn maintenance

§  Ads for property

§  Accounting fees

§  Attorney fees

§  Mileage

§  Your time on a per hour rate (I calculate 20 hours per deal) at   $ 200.00 per hour.

§  Advil (8 tablet per day)

§  Rolaids (6 per day)

§  Bottle of Jack…

Other than that, add what you need to make your deal work. In order to know that your investments are worthwhile, you must know what your deals cost per day.

Paul J Da Costa

Is a licensed Realtor in Georgia. He is a Real Estate investor, educator, and national speaker.

Paul is available for select speaking engagements and can be reached at 941-716-2597

Real Estate Investor