If you’ve done much marketing for real estate ‘Motivated Seller’ leads you’re probably familiar with “List Stacking.”
I did my first List Stacking over 30 years ago by combining delinquent property tax lists with out of state and vacant landowners of 50 acres or more. I used the same stacking strategy going from county to county and state to state.
With List Stacking my profit went through the roof!
List stacking has evolved way beyond what I started with long ago. There are now list management services that can stack dozens of qualifiers and filters on top of each other, from foreclosures and divorce to county code violations, home equity, age and many more.
Having a good list stacking strategy CAN be a powerful ‘force multiplier’ for your real estate biz, BUT… (and it’s a big but)….
Even with the best list stacking, over
95% of your marketing cost is a total waste
and you still end up in the worst markets.
Think of LIST stacking as the bait or lure you use to get motivated seller leads to ‘bite’ by responding to your mailer, your bandit sign, digital ad, cold call, whatever.
Even the best lists and perfect execution
tactics are useless if you’re in the wrong market.
Whether you’re wholesaling, flipping, buy-and-holding, or brokering deals, the specific local market you target will contribute to your success or cause your failure far more than all the other stuff combined.
It doesn’t matter if you have the best list or best offer or the best of everything else… If you aren’t first INTELLIGENTLY deciding WHERE you’re going to fish for leads or cast your acquisitions net you simply will not achieve the highest results. You’d be working harder, making far less, taking more risks and leaving your financial future up to random chance.
It’s only a matter of time before you get clobbered in the wrong micro market(s).
Real estate success isn’t just about making the phone ring; it’s about targeting VIBRANT, LIQUID markets; being able to sell your deal and get paid.
The WORST markets have the most responsive sellers BECAUSE they’re in the worst markets. They’re hoping some fool comes along and bails them out.
If you’re not MARKET STACKING, you may
as well stamp SUCKER across your forehead.
Back to our fish analogy, even if you randomly stumble into an area with a lot of fish (motivated sellers), chances are they’re NOT the fish (deals) you want.
You don’t catch Rainbow Trout fishing out in the ocean somewhere.
How do YOU decide which markets,
zip codes or neighborhoods you invest in?
How can you even know what to offer if you don’t know where that market is in its cycle?
If you’re looking for cash flow, there are many markets you can exclude right off the bat.
If you’re looking to build wealth, you want to target high appreciation markets AT THE RIGHT TIME.
If you’re looking to wholesale, you want vibrant, quick-turn, high demand micro markets and neighborhoods.
The list goes on.
For every real estate investing strategy, goal, and risk profile there are certain MARKET ATTRIBUTES you want, and even more that you want to avoid.
In this example we’ll look for the best wholesaling markets for cash flow ** AND ** appreciation ** AND ** Wholesaling all rolled into one using our new Precision Market Finder tools.
We’ll use the state of Georgia in this example, but it works the same if you were looking nationwide or drilling down inside a specific city or county.
First let’s look at all 643 zip codes we track in Georgia based on their CASH FLOW potential.
We’ll use Gross Rent Ratio (annual rent divided by house value) for a quick overview of all Georgia markets.
Here’s the map version…
Next, we’ll filter out those zip codes with poor short term appreciation potential by stacking our proprietary ‘Market Forecast’ predictor on top of the Gross Rent Ratio filter. By removing all zip codes that have a Market Outlook score below 30, we increase the likelihood of appreciation in the remaining zip codes…
Here’s the map view of the 508 zip codes making it through the appreciation filter…
Next, we stack on two indicators we want to see for a STRONG, VIBRANT WHOLESALING MARKET; Days On Market not to exceed 60, and Price Reduction ratios no higher than 40% of active listings.
Here’s the map view of the 302 zip codes making it through the appreciation AND Wholesaling filter…
Lastly, we want to filter out any zip code that has a low likelihood of strong cash flow by eliminating those markets with a Gross Rent Ratio of less than 7%.
Here’s the map view of the 203 zip codes making it through the appreciation AND Wholesaling AND the cash flow market stacking filters…
These same map results are available in fully customizable table formats.
You can add, remove, and adjust any indicator’s minimum and maximum ranges or create your own proprietary pre-set stacking filters you can use over and over again in a single click.
The settings we used for this example were fairly ‘loose’ in that we ended up with 203 zip code level markets meeting our Cash Flow + Appreciation + Strong Wholesaling criteria.
If we wanted to create a smaller list with only the very, very best cash flow, appreciation, and wholesale markets we could have added additional stacking indicators (from our list of over 100) and/or stiffen the criteria by tweaking the min-max ranges…
…the Precision Market Finder also includes the one-click ‘magic buttons’ to instantly generate tables and maps of the best markets based on YOUR strategic goals and risk profiles.
These pre-set market filters are fully customizable for 1-click Market Stacking results on any National, State, Metro, County or Zip Code level.
We have been rolling out some amazing new micro market tools for Wholesalers and Rehabbers. Our Neighborhood Ranking tool alone should save you thousands a month in targeted acquisition and lead generation costs. Click here to buy now.