The Monkey House With Kathy Kennebrook
Episode 399: The Monkey House With Kathy Kennebrook
The real estate business incorporates a lot of different techniques to effectively screen potential clients. One of these techniques is direct mail marketing. Kathy Kennebrook discusses how direct mail marketing works and why it is a helpful technique in bringing highly qualified leads in real estate. Kathy is a nationally renowned marketing expert and holds a degree in accounting. Listen in as she joins Mitch Stephen to talk more about the direct mail campaign and how it is used in the real estate industry.
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I’m here with Kathy Kennebrook. She’s over in Florida. She’s going to talk to us about direct marketing and mail. First, I’ve got to pay homage to my sponsor, TaxFreeFuture.com. Please check the 37 little video vignettes. If you do not have a tax-deferred or tax-free retirement account in which you can grow your investment or your retirement funds, you’re missing the boat. You’ve got to learn about what you can do with those things. I’ve been doing it for years and it does pay big. Imagine not having to pay taxes on your profit on all your investments for a long period of time. You won’t believe what your financial advisors are not telling you. Kathy, how are you doing?
I’m good. How are you, Mitch?
I’m doing good. I heard a lot of the audiences called you and you were talking to a lot of people. We’re going to go ahead and put your phone number because apparently, people want to talk to you when I finish having this with you. You don’t mind talking to them at all.
No, I don’t. I love talking to new people and helping them. That’s what I’m all about.
Real estate is a broad arena. Let’s describe your niche and why you’re choosing it.
Primarily my niche is direct mail marketing. That’s the primary way that I like to find highly motivated sellers. A person should always have between 1 and 5 different marketing techniques in play at any given time, but one of those needs to be direct mail marketing. What I do is I have specific types of sellers that we target, both with the letters and with the criteria within the lists to bring in the most highly qualified leads and have them pre-screened when they hit our desks.
You’re talking about building a list. You don’t want to go out there randomly and grab a bunch of people to waste postage on. You want to qualify these people. I call it data sifting. You run it through one set of data and then you run it through another set of data and less people fall through. By the time you finish running them through these different filters, what’s leftover in the bucket might not be that many people depend on how many filters. They’re more and more targeted with every filter that you put. Where are you getting your list? How do you form a list? Do you buy it? Do you create it?
All of the above. It depends on which direct mail campaign that we are targeting. Some of the lists, we work with list brokers and my students have the same resources available to them. We work with specific list brokers who will provide the list for them. They break it out into much finer criteria to hone in on the most highly qualified leads that are going to come in. That’s one way. Another way that we do it is that our students simply go to the property appraiser’s office or assessor’s office, depending on what that is where they live. They’ll go down to the county and get the lists themselves depending on what list that is like the divorce, evictions, and bankruptcy. Those types of lists. They can simply go to the courthouse or go online and get. Some of the counties, including the county that I live in and a lot of the counties like in Florida, you can go in online and put in the specific criteria that you’re looking for and create your list yourself. There are a lot of good ways to get those lists.Don’t try to reinvent the wheel. Continue to do what works. Click To Tweet
Here’s some good news for someone who doesn’t have a big budget. You’re going to get the filter. If you can only afford to send 50 people a week, put it through many filters that only 50, 60 people fall through into the bucket. It’s not a lot of people, but are they target rich? They should be the cream of the crop that you’re mailing to.
The other thing that I do to bring that criteria even tighter is I use a specific letter that has a response mechanism in the letter that tells the seller exactly what I want them to do and what information I need in order to determine if there’s a deal there. Nobody does that. Even if you’re a newbie, beginner, when you get the response from the seller, you’ve got the thing pre-screened for you when it hits your desk. You’ve got most of the information that you need. That’s another tool that we use to filter out the junk because if they take the time to fill out that response mechanism and send that letter back to us, and a lot of times Mitch, they put photographs in there too. I got the letter, I’ve got the information and I got pictures of the property. It’s already pre-screened when it hits my desk.
I’m talking about who do you choose to send that to? You can make that super targeted and then by the time they send you back a response, whoever responds now are like prime suspects. They’re almost confessing.
Going back to the sellers, there are specific lists that we target. One of the things that I tell my students to do is look at your demographic. Look at where you live. What types of sellers are you going to have? For example, I live in the geriatric capital of the world. I’m in Florida. Estates, probates, quick claim deeds and out of state owners. Those are a real resource for me to find more deals. I work with students that live in military areas. They’re writing to people on military bases because they come in, they buy a home and they get transferred somewhere else. What I tell my students to do is look at your demographic. Decide what type of seller you want to hone in and target and then choose the direct mail campaign that goes along with that, then use the criteria in the body of the list and you’re looking at a ton of good leads.
Sometimes it doesn’t even take a ton of leads to get where we’re going. Thinking back a little bit, if you were starting, what would you do differently than how you did it?
Start sooner. I had the typical beginner brain when I first started. We had every excuse in the book not to get started. It was almost a year from the time we started real estate investing to the time we did our first deal. What motivated me to get started was buying $13,000 in books, tapes, and programs. At the end of that first year, it was like, “I want my money back.” Here we are. That was one of the things that we did. Something else that I will suggest to a new student is find a local real estate club, get to your club, get educated, ask questions. One of the things that I did is I figured out what my trigger is, what my button is.
My personal button is I don’t mind embarrassing myself but you’re not going to embarrass me. I stood up in a real estate club and I said, “I’m going to do fifteen deals before this year is over.” In order not to embarrass myself, I got down, got heavy, and got busy to make that goal happen. Figure out what you want in your business and move forward. Don’t listen to broke people. If somebody is not doing what you do, then don’t listen to whatever their advice is. Find people who have come before you and get out there and do it. Don’t try to reinvent the wheel, continue to do what works.
I love people that try to tell me what I’m doing and I’ve done it 2,000 times more than them. I don’t know what possesses these people to even get on that track. “How many houses have you done?” “I’ve done four.” “We’ll talk to you later about your experiences.” What does a typical deal look like for you? What’s one of your favorite deals you’ve done?
Down here in Florida is we’re dealing with some goofy deals. I’ll tell you about one of my favorite goofy deals that we did. A beautiful home, about half a mile from where I live here in Bradenton and people are still talking about this house. It’s in a nice area. It’s near one of the preserves that is close to us. We have a lot of preserves in our area and we call it the Monkey House. If anybody has ever heard me speak, you’ve heard me talk about the Monkey House. The seller contacted me from a direct mail campaign and she got three letters from us because she got stuck in three different siphons. The divorce letter, the outer state owner letter, and an expired listing.
She contacted us by phone and said, “Please buy my house.” She mailed us the keys. Is this a motivated seller? Obviously. She doesn’t know me from anything. We go over to the house. It’s a divorce situation. He moved out, she moved out and she went to Indiana. While she was living in this house, she was raising Capuchin monkeys. They were supposed to be like support monkeys. We walk in the house and there’s a half-inch of monkey poop everywhere in the whole house. The house had been on the market for eighteen months and hadn’t sold, I wonder why. All of the wallpaper in the house was black, green, and jungly looking. It was bizarre.
The house was worth about $490,000. We ended up buying the home for $225,000. We knew we had a deal here and we get to the closing. She was shaking because she already had a couple of sales fall. I’m shaking because there’s a big paycheck here. We get the thing closed. When she came down to Florida, she had brought the monkeys with her. My title lady said, “She’s not bringing those monkeys to my title company.” The seller says, “Here’s what we’ll do. We’ll leave the monkeys in the house. We’ll go to the closing, we’ll close the house. We’ll go back to the house. I’ll get my monkeys. I’ll give you the keys and life goes on.” Best laid plans of mice and men.
We get back to the house and she’s got this big Ryder truck out there. She’s got this big cage in the Ryder truck for the monkeys. She brought the monkeys with her, Rambo and Reiland. Rambo is about a 3-foot monkey. He’s ugly with the big fangs. Reiland is a baby monkey. He’s about four months old. She gets the big monkey and she puts his leash on him. She takes him out to the truck and she puts him in the truck. She goes back in the house, she gets the baby monkey. She puts his little diaper on and she puts this little t-shirt on. She brings him out and she’d ever gently put him in the truck. Right about then, Rambo, the larger monkey decides he’s not having any part of it. Gone monkey. He’s off and running. He’s gone through yards. The seller, her son, my husband, and me chasing this stupid monkey all through neighborhoods, through people’s backyards, the whole nine yards.
If he makes it to the preserve, which is close, she shall never see the monkey again. Finally, we chased the monkey and the monkey is running down the main road toward the preserve. There’s a car coming in the other direction. He’s got these big thumper speakers in there. He pulls over because he thinks this is the funniest thing he’s ever seen. He flings the door open, he’s got his iPhone and he starts taking pictures. Right about then, in jumps the monkey into the car and in jumps the seller into the car. She finally got her monkey and life went on.
How much does it cost to rehab this house? How did you sell it? You bought it for $225,000. It was worth $490,000. What happened in the middle?Do something. Don’t sit and make excuses to not get started. That is one of the biggest mistakes you can make. Click To Tweet
The first thing we had to do was to hire a company to come out and completely clean the thing. Sanitize it top to bottom because monkey poop is not good, diseases, and all that. We spent $80,000 on the rehab. We sold it immediately and my paycheck was $89,000. That was cool but some of my deals are goofy.
That’s the one for the books. What was her deal? Was she mentally crazy or didn’t have too much money?
She got the house in the divorce and she was continuing, making mortgage payments on a house she didn’t live in. She had a house in Indiana and a house in Florida. She was continuing to make mortgage payments on a house in Florida that she did not live in. There was a lot of other stuff going on. Her ex-husband who did live here in Florida was going over to the house and sabotaging it, turning the water on and leaving water running. He took the filters out of the air conditioning and unplugged the tubes so that the air conditioning would leak. It was fun.
You had a lot of surprises in that rehab.
We did. She said she mailed us the keys. The home was close enough to us that between the time that we put it under contract and close, we were able to go by and take a peek and check on things before we closed on it. We caught a couple of those things before they got terribly bad.
What kind of strategies do you recommend for the new people out of there?
My strategy for a new person is to get started. Do something. Don’t sit on your dumpies and make up a whole bunch of excuses not to get started. That was the biggest mistake that I made. Follow your gut. If your gut tells you that this is a good deal, do the deal and figure it out later. I had a deal that I did back in the beginning. I knew it was a good deal. The seller contacted and said, “I’ll deed you the house. I got the key sitting right here.” The difference between the mortgage balance and what the house was worth was huge. I had no idea what a subject to even was. I went back to my real estate club and I ended up paying a real estate investor $10,000 to teach me that particular strategy how to do the subject to paperwork. Even after I paid him $10,000 and the other things we had to pay, our paycheck on that one was $51,000. When you are using someone’s system, whether it’s my system or somebody else’s, if it isn’t broke, don’t fix it. Follow the directions, do what you’re being told, get moving, go forward, and get some deals done.
If you guys are interested in talking with Kathy more about her mailing programs and what she does and how she does it, I want you to go to 1000Houses.com/monkeyhouse. Check it out. Do you have any giveaways or anything for my audience? Anything they can get for free?
I sent you my book called Your Personal Path to Prosperity. It’s a good rounded out book that covers a lot of things you don’t normally see. It covers time management and how to work with your spouse. A lot of things like that, that are particularly interesting to the investor and will help them grow their business. A $16.95 value but it’s a good bonus.
There’s a lot of good free information out there and it also helps learn about the personality behind some of the programs or educational resources that are available to you. It’s always helpful to get to know the person. Did you write this book yourself or did you work with someone to write it or how did you write the book?
I wrote the book myself and then I have a professional editor and publisher in my family. He went through and did all of the cleaning up and all of the editing. The book is awesome.
It’s great because my point is that when you read a book, if it’s written by the author, you can get a good feel for who they are, what they’re about, how they think and a lot about their personality. It’s hard to fake an entire book. You’re going to see the real person in there. I want to thank you for taking the time to come on. Anything you’d like to say to the audience?
First of all, I appreciate you having me. I’m enjoying working with you. We’ve worked together a little bit over the previous years. Your students are absolutely awesome. When they call, they always have such good questions. You’re teaching them right. My feeling is that I’m looking forward to working with everyone. I want you to be successful. One of the things they also get from me, Mitch, when they do invest in my system, they get twelve months of support from me. They can email me any marketing question that they have and there are few gurus out there that take the time to do that. I like working with my students. I want them to be successful. We cover everything from single-family homes right onto multifamily and everything in between.
Your marketing will change over time depending on what you’re doing in your business. My marketing has changed over the years. I’ve been around a long time. I started flipping and wholesaling a lot of deals. The older I got, the greedier I got. We do more rehab. We do more work for equity. We do more lease options and things like that. Your ideas and your goals will change as your business grows. Keep that in mind and make sure you’re planting your goals. Make sure you’re figuring out what you want to do with your business as you’re going along.
It’s a good advice. I would like to thank you for taking the time to come on. I’d like to thank the audience for taking the time to stop by and get you some Kathy Kennebrook. She’s a wealth of information. Lots of experience in a lot of different strategies. Please go to 1000Houses.com/monkeyhouse and we’ll get you that free book, Your Personal Path to Prosperity. There will be all kinds of things over there. Plus, there will be a phone number to call if you want to discuss where you’re at and where you’re trying to go and maybe some options with Kathy. I’d like to thank TaxFreeFuture.com for being a sponsor. Please check out the 37 little video vignettes there. You won’t believe what your financial advisors are not telling you or why they’re not telling you. We’re going to tell you why they’re not telling you and then you can do with it what you want. It’s very eye-opening.
Thanks for having me and for being on board.
About Kathy Kennebrook
Kathy Kennebrook is the ultimate success story. She spent over 20 years in the banking industry before discovering the world of real estate.
I am married, I live in Sunny Florida and I like investing in Real Estate, and having Good Times. I like to travel, I like kayaking, bicycling, music, a good book to read and growing plants. I have two children and five grandchildren, I know I don’t look that old do I??
I like to travel, I am a national expert on marketing to find motivated sellers for your real estate investing business and I love to travel the country and share my expertise with others. This gives me the opportunity to spend quality time with my family and help others grow their Real Estate Investing Business so they can live their dreams and spend time with Family which is most important of all. I live by the Credo “Live for Today, who Knows What Tomorrow Will Bring”.