Ranked 90 addresses by roof plane, and the tier one letters did all the work

I read houses for a living from the framing side, so I tried using that on a driving list instead of mailing everything at once.

90 addresses logged over six weeks in an older tract, mostly hip roof ranches from the sixties. Sorted them into three tiers from the curb only:

Tier one, 28 addresses. Roof plane visibly out of line, a sag between rafters, or a rooftop patch that had been patched again. Plus anything with a bulge or a stair step crack in the visible foundation line, or a porch column that had moved off its bearing. These are houses where the repair number is big enough that an owner without cash has probably already gotten a quote and gone quiet.

Tier two, 39 addresses. Deferred maintenance that hasn't turned structural. Cupped siding, gutters gone, a section of fence down.

Tier three, 23 addresses. Just untidy.

Mailed tier one only. Two touches, 28 addresses, cost me under $50. 5 calls, 2 kitchen conversations, 1 contract at $141,000 on a house I scoped from the curb at $38,000 of work.

Actual repairs came in at $46,000 once we opened the rear wall, because the sag I saw was a rafter that had been sistered badly and the top plate under it was gone. I bought this one to hold, so the $8,000 came out of my pocket rather than a buyer's, which is the part I'd change. My curb number was 17 percent light on a house where I could see the problem from the street. Now I run the curb estimate and add 20 percent before I put a price on paper.

What I'd keep: mailing 28 instead of 90. The tier three letters would have cost me forty dollars and taught me nothing.

2 replies

3joe_delgado5AP4CPRO6

The tiering is sound and I use something like it. But I'd push back on which tier makes money.

My last four deals came out of what you're calling tier two. Cupped siding, dead landscaping, gutters gone. The reason is on the seller side rather than the building. A house with a sagging roof and a moved column often belongs to somebody who has no money at all, and people with no money frequently can't sell cheap either, because they need every dollar of the equity to land somewhere else. They'll sit for two years. Meanwhile tier two is full of tired landlords and out of state heirs who want a check and a closing date and don't care about the last $8,000.

Your tier one worked because you can actually price structural work and hold the house. That's your edge, and it's not one most people on this list have. Anybody copying your tiers without your scope ability is going to write a $38,000 number on a $46,000 house and not have a rental to absorb it.

On @tally's question, mail all three tiers your first time out and log which tier your calls come from. Twenty dollars more in postage buys you the answer to which tier your market pays for, and it won't be the same as mine.

Ranked 90 addresses by roof plane, and the tier one letters did all the work

2 replies