Welcome to Prop360’s Ultimate Guide to Driving for Dollars! Today, we’re going to cover everything you need to know to get started driving for dollars, plus some tips and tricks on using Prop360 to help automate the process. So let’s jump right in!
What is Driving for Dollars?
Before we get started on our guide, we’ve got to understand what exactly driving for dollars is.
In essence, driving for dollars is the act of driving neighborhoods and looking for distressed properties. Think tall grass, old roofs, etc.
We will then be mailing and marketing to these properties to either:
- Purchase for cash
- Sell to end-buyer investors
There’s a lot of tactics and techniques to get the most out of driving for dollars (and save a ton of time while doing so!) that we’ll attempt to cover in this guide. Using a tool such as Prop360 is crucial to save you the most amount of time, while getting the most out of every lead you send to.
How to Drive for Dollars
To get started driving for dollars, you’re going to need a basic set up.
We prefer the “two-driver” setup, where you’ll have one friend or business partner be scouting the properties, while the other person drives.
This is a lot safer than driving while scouting.
If you do go solo, definitely stop on the side of the road if you see a property.
Definitely don’t use your phone while driving, or get distracted. Don’t be the dangerous driver!
Getting Set Up
Now that you’ve got a team member or two, and a car, you’re ready to get started.
You’ll want to get an app such as Prop360 to handle your route tracking, along with property tracking.
This will help keep you organized over time, and allow you to spend less time on lead management and follow up, and more on the top of the funnel – adding more deals.
Prop360 allows you to add properties on-the-go, look up owner information, skip trace owners, and send mail at the tap of a button.
You can even configure custom mailers and sequences, often with more customizability than your average direct mail vendor.
Picking a Driving for Dollars Route
Now that you’ve got the app, car, and team, it’s time to get your route sorted out.
Do you have an area of town in mind?
If not, try to choose an area that generally has a higher density of rental or distressed properties. You’ll likely get more value out of your time, as your end customers will be investors, or yourself looking for rentals.
Higher-priced areas can still work as well with this method, but your end consumer may be a bit different. You might find that selling to developers as end customers might work.
Experiment a bit with your mail and see what works best for you. What works in one part of the country may be completely different from another area. This is your time to shine and come up with methods that work best for your business.
Leverage Prop360’s route tracking feature and see which drives resulted in the most properties added. Spend more time in these areas, as these will be your deal centers!
Driving Through and Scouting Properties
Now that we’ve got a neighborhood down, it’s time to scout some properties.
We’ll want to look for primarily distressed property. What does this mean, exactly?
Distressed property is essentially property that has fallen into disrepair.
Depending on your area, distressed may mean a house that’s never been updated, or a house that’s caving in on itself.
It all depends on your risk tolerance as an investor (or wholesaler) and who your end buyers will be, along with the area you choose to operate in.
Here’s a few things we look out for when scouting. Note that everyone has their own methods, but these things will generally signal a property that’s distressed and in need of repair:
- Old roofs, or our personal favorite, moss covered roofs
- Yard in poor condition, or potentially no grass at all
- Entire exterior in poor condition (peeling paint, cracked bricks or concrete, etc.)
- Broken or old windows
- Cars in middle of front yard
- Broken fences
- Trash all over front yard, or piles of trash on porch
- Old blinds or severely dated exteriors
- Boarded up doors or windows
- Notices on doors or windows – This could signal a vacant or code violation property
- Heavy overgrowth (trees, ivy, etc.) or extremely tall grass
- Gutters falling off, or no gutters at all
After you do this for awhile, you can tend to get a feel for properties the second you look at them.
That’s when you can really start to speed up your deal flow, since you can look down a street and instantly see any property you’ll need to add, before moving on to the next.
Selecting and Mailing Properties
Now it’s time to select which properties to mail from your initial list.
If you’re adding properties into your Prop360 account, chances are you’ll want to mail every property you add. That’s because with our app, you’ll only add properties that are severely distressed.
Generally speaking, most wholesalers or investors will purchase massive lists from a vendor such as ListSource and mail to every single address.
While the distressed properties will likely be in this list, you’ll also be mailing to thousands of other people that do not have distressed properties and aren’t interested.
That’s where Prop360 comes in handy. By driving for dollars, you’ll only be mailing to distressed properties.
This will not only save you a ton of money, but also a ton of time – because you’ll only be relying on leads that you know are pre-qualified.
When getting started, you may start with only severely distressed properties and work your way down a bit. That’s fine. Continue to iterate and see which type of houses and areas get the best results from your mailings.
Adding Properties in Prop360
In Prop360, the second you add a property, snap a photo.
This will immediately save the property into your account, and you can view anything from owner info to estimated equity.
Then click Start Mailing. The property will be immediately put on a mailing sequence, automatically, based on your selected features.
When getting started, we recommend a mailer a month for at least 6 months. Street view postcards and letters tend to get the best response rate.
Sending one mailer here and there may get deals occasionally, but to get deals consistently, you need to be sending mailers on a regular basis at a decent interval (every month or so).
Keep your mailers running on your distressed properties and you’ll see way better results.
You can also leverage custom templates if you want to stand out a bit from your competition. Read more about using custom templates in Prop360 here.
Real Estate Skip Tracing
A second method to getting in contact with owners is via Skip Tracing. Luckily, you can do this right inside of Prop360 as well!
To skip trace an owner, simply click View Details once you’ve added a property.
Here, you’ll see a ton of information on the property – from owner info to even estimated equity. We currently have data on approximately 140 million properties in the United States, and it’s growing each day.
To skip trace an owner, simply click Skip Trace.
This will instantly provide you with as many phone numbers and emails as we can find for the property owner, so you can get in contact as quick as you’d like. From there, it’s just a simple cold call, text or email.
You may not even need to mail them to get a conversation started. It’s all about having the right tool!
Handling Inbound Lead Volume
Now that we’ve got properties being mailed, we’ve got to discuss the most important thing: handling inbound calls.
When starting out, you’ll likely be taking these calls by yourself. And that’s totally fine.
But we definitely recommend handling these calls on some form of script. And perhaps even outsourcing them from the start.
The reasoning behind this is you want to take these calls the second they come in. They could happen any time, at any hour.
Of note, if you’re allowing texts to your phone number – respond promptly. Every minute counts!
Leveraging a customer service center such as Nexa may be a great option. They can take all your inbound calls for you, and you’re only charged either a minimal monthly fee, or a low amount per-call.
When a lead comes in, you’ll get an email ready to go with all the details.
Then you’ve just got to do some basic lookups, and schedule a meeting to check out the property and make an offer.
Real Estate Lead Management
We’ve got calls coming in. We’ve got more leads being added to our Prop360 account daily. What’s left?
The most important part – lead management.
Luckily, Prop360 has this all covered for you. Once you add a property, it’ll continue to get nurtured and receive follow ups until you either make an offer, or it’s removed from your properties.
For those that aren’t relying on an app, it’s your job to manually schedule the direct mail sends and call follow ups. This can get a bit complex, especially when you’re handling multiple leads coming in.
Since you’ve got the whole process down now, it’s time to focus on repetition.
Do your best to cover your entire “farm area”. Then, every few months, repeat this process.
Keep in mind that as houses sell, get flipped or turn into rentals, other houses will become distressed.
It’s your job to stay on top of your market and continue to hunt for distressed properties. Each time a property is improved, there’s often several more that become distressed. Staying on top of your area and continuing to send mailers out to targeted properties is the only way to be successful when wholesaling or investing.