Everyone has received mailers in their lifetime, whether it’s postcards, letters, catalogs from companies, or personal letters from friends and family. According to a survey done by Epsilon, “77 percent of consumers sort through their physical mail as soon as they get it.”
A direct mail marketing strategy like sending yellow letters is one of the most effective marketing pieces to grab the attention of property owners and secure consistent real estate opportunities.
Moreso, “98 percent of people check their mail daily,” so the chances of an addressee coming across your mailer are extremely high as long as you have the right mailing address.
By reading this guide, you'll learn exactly how to use yellow letters as part of your overall strategy to land more real estate deals!
Let’s dive straight into Yellow Letters: The Ultimate Guide For Real Estate Investors! Use this menu to jump to your section of choice:
Yellow letters are a type of direct mail marketing strategy used by businesses, marketers, and entrepreneurs. They are bright-colored mailers delivered straight to a targeted group of recipients using a delivery service like the U.S. Postal Service.
Additionally, these marketing pieces are handwritten on yellow paper or legal pads to provoke a personalized feeling towards the addressee. The handwritten font gives the property owner the impression that the sender took the time of their day to personally write the letter.
Yellow is a common color used for mailers because it attracts the human eye more than other colors. That said, you are not limited to using just yellow lined paper from legal pads. They also do not have to be handwritten and can instead be typed using a handwritten-like font.
More specifically, yellow letters in real estate are handwritten (or appear to be handwritten) direct mail letters sent by investors, brokers, and wholesalers to property owners.
They are an efficient, yet non-confrontational way to reach out to a list of homeowners to let them know you want to help sell their home.
This strategy can have a high response rate and return on investment if done properly, which is why this form of real estate marketing is quite popular in the industry.
As with most things, make sure to educate yourself on using this method, as you can lose money fast if you don’t know what you’re doing. Reading this blog is a great start, so you’re on the right track!
Real Estate Skills Tip: While yellow letters can be sent without a specific list of homeowners in mind, we strongly advise you to have a quality list before starting yellow letter marketing to have the highest success and response rate.
There are ways other than handwriting each letter that will save you a great amount of time and effort, especially if you have a long list of addresses to target. Some of these methods are photocopying yellow letters or paying a yellow letter company to make them for you, which we'll cover later in this guide.
Yellow letters are one of many targeted direct mail marketing strategies used in real estate to obtain motivated seller leads.
Another comparable tactic is sending out real estate postcards, however, they may not be as fruitful because they are more likely to get thrown out as junk mail.
As mentioned before, yellow letters are a more personalized and friendly way to approach potential sellers. This provides a better start towards building a relationship with the homeowner and might encourage them to work with you on selling their property.
Below is what a yellow letter for real estate looks like:
There is a wide range of real estate professions and while they are each different in their own ways, all of them may use yellow letters to increase their deal flow. They include:
That’s the beauty of direct mail marketing strategies for real estate. The fundamentals work no matter what niche of the industry you're in!
Typically, direct mail letters are used most often by real estate investors and include the message, “I Buy Houses For Cash.” These are usually investors looking for a fix and flip project, rental investment, or a wholesale deal.
Now that you know they can be used by virtually anyone in real estate, the next question is who do you send these real estate marketing pieces to?
While you can send direct mail letters to any property owner, it’s best to choose those who are more likely going to sell.
How do you determine which property owners could become motivated sellers?
Here are various factors that would encourage property owners to sell:
You want to obtain a list of properties that are in any of the above categories. Do some research on the property by skip tracing the owner's information. Further, each county has public mortgage records you can access to see if the homeowner is behind on their mortgage.
If they happen to be delinquent on their mortgage, taxes, or utility bills, you might be able to catch them at the right time to buy the house and relieve them of their financial stress. Also, if an owner has a large amount of equity in the property, it could be time for them to cash out.
Remember that it’s critical to have quality information when starting a direct mail marketing campaign. The last thing you’d want is to send a plethora of yellow letters and not hear from any homeowners because you had the wrong address or directed it to the wrong person.
Important: Do your research on the property to prevent undeliverable or misdelivered mail. Otherwise, you may have your mail sent right back to the return address!
Yes, yellow letters and direct mail marketing work for real estate investing. This strategy continues to be used in the real estate business to get motivated seller leads year after year. The downside is it can be quite costly and time-consuming for those just getting started in the business. Fortunately, we have some great tips for you to overcome these obstacles.
Sending the yellow letter is just one part of the whole direct mail campaign. You still have to know how to effectively communicate and follow up with homeowners once they respond to your marketing.
Here are some tips for how to build a more successful yellow letter direct mail campaign:
Yellow letters can be the gateway to initiating the first conversation with a potential seller. Your communication skills, ability to work the lead, and close the deal will ultimately determine how successful your efforts are.
Unless you have a Realtor or real estate broker representing you, make sure to brush up on your negotiation skills with sellers. Having great sales and rapport building skills will help you increase your chances of landing many real estate deals and are all-around great expertise to have in life!
Nowadays, receiving a handwritten letter in the mail is very rare. When you find one within a pile of junk mail, you will most likely become intrigued to see who wrote to you and what’s within the content of the letter.
The envelope itself is what attracts the owner in the first place. With a handwritten address on the front and the color of the bright yellow letter shown through the white envelope, the owner is immediately going to think someone took the time to write a letter to them.
That is why they are more personalized than other forms of direct marketing. Yellow letters should give the impression of being written by a friend.
In addition, yellow letters are simple, short, and sweet. The message within is clear and concise which allows the reader to read through the whole letter without being left confused.
There should always be an easy to read call to action or statement that creates urgency for the recipient to do what you want them to do. For example, "Call today for your free home evaluation" or "Visit this website for more information" are simple calls to action.
The bold colors and font also grab the reader’s attention. It’s best to use red ink to make the words pop out.
Direct mail is the marketing method that provides businesses with the highest return on investment for customer acquisition, which is an ROI of 34% according to the United States Postal Service (USPS). It’s no wonder that real estate marketing pieces have a higher response rate compared to other marketing tactics like sending emails or radio advertisements.
As mentioned before, yellow letters have that “personal touch” that no other form of direct marketing can provide to a specific target. The USPS, although biased, even states 67% of consumers “feel mail is more personal than the Internet.”
With that extra level of care and customization, handwritten yellow letters are more effective and have a higher response rate than less personalized letters or mailers.
If you’re short on time, there are hybrid approaches where you can photocopy a handwritten template and then fill in the blanks or pay a service that sends out direct mail for you. We will get more in detail with that shortly.
Below are several sample yellow letters for your reference:
If you own desirable property, you've certainly seen mail pieces like these yellow letter examples:
Here's an example of a yellow real estate postcard, another popular marketing piece among investors:
While you only need one template to get started sending yellow letters as a real estate investor, you must always be testing your marketing. You can adjust the fonts, colors, text, images, frequency, and every aspect of your campaign.
You want to have a solid yellow letter template to get started with your efforts, though you can make multiple templates for yourself as you wish. To make things easier, we have provided you with a free template you can use to start your yellow letter campaign today:
Don’t forget to include your phone number and a call to action at the closing of the letter!
The cost depends on the method you choose to produce and send the yellow letters. If you’re using the photocopying method, it will come down to the price of ink from the copier, yellow legal pads, stamps, and envelopes.
With this method, the average cost will come out to be around $0.70 per yellow letter.
Currently, the best place to get more bang for your buck for yellow legal pads is none other than Amazon. The cheapest and most economical option comes in around $12 on Amazon where you get 12 pads in one pack. Each legal pad has 50 micro-perforated sheets that are perfect for making straight-edged personal letters.
As for the stamps, you can buy them from USPS.com where they have Forever stamps for $0.55 each. With just one Forever stamp, the yellow letter can be mailed anywhere within the United States as long as it weighs one-ounce or less.
Cheap envelopes to place your direct mail in can be found on Amazon as well. The best option as of now is $29.95 for 500 envelopes.
The cost does accumulate over time if you decide to increasingly use this method, however, it will more than pay for itself if you do it right.
With the limited amount of time we have per day, it’s understandable to not want to sit at a desk and hand write each yellow letter. That would take many precious hours out of your day where you could be doing something more valuable.
There are three methods for producing cheap yellow letters. Depending on your budget and available time, you may prefer one more than the other:
We will break down each technique by explaining the pros and cons so you can make a well-informed decision.
As we've discussed the first and original method of producing cheap yellow letters is quite literally handwriting each letter. You might be able to recruit a few writers to be more efficient with your time or in case your handwriting is illegible. Offer them a percent of any deal you close or pay them a flat fee when a deal closes.
Once you have handwritten the yellow letters, simply seal them in an envelope, place a stamp, complete the return address and mailing address, kiss them good luck, and mail them using the postal service!
A fast, efficient, and affordable way to produce direct mail letters is to resort to photocopying. If you have a printer at home, you can have a stack of real estate letters ready to mail out in no time. Here is a step by step guide on how to photocopy yellow letters:
Don’t have a printer at home? Office supplies companies like Office Depot offer printing services to fill your direct mail needs!
If you’re willing to invest more in direct mail marketing, then you should think about putting your money towards yellow letter companies. You might find outsourcing yellow letter production is the best use of your time and budget.
We will go more in-depth on two direct mailing companies in the next section.
Time is extremely valuable and while you can produce real estate letters yourself, you can save the hassle by paying direct mail companies to produce them for you.
This works best if you already have a mailing list. However, you’re in luck if you don’t have one! What’s neat about these yellow letter companies is they can provide you with a mailing list of a targeted area of your choice for an additional fee.
If you’re unsure whether or not you would like to spend your money on direct mail companies, there are some that will send you free samples so you can see a physical example and get an idea of the quality of the product.
When looking for a direct mail company to produce your real estate letters, make sure to look into the minimum quantity per order, customization availability and/or fees, and turnaround time as each one varies.
We did some research on some direct mail companies that produce yellow letters and went more in-depth on the top two we recommend you put your money into. Check them out below!
Yellow Letters HQ has the cheapest yellow letter service with a variety of options for you to customize the perfect yellow letter to your liking.
The price is determined by how many you’d like to buy plus any additional features you’d like the letter to have. As with most direct mail companies, the more you buy, the less each will cost.
The standard option (200-499 quantity) will cost you $0.86 per letter which will come out to a total of almost $172 if you choose to buy the minimum 200. You can choose your desired template, printed handwritten-like font, font color, paper color, and customize your message.
No matter which option you choose, each one includes the following:
Yellow Letters Complete is very similar to Yellow Letters HQ except they will handwrite the homeowner’s name and address on the envelope to make it even more personalized.
For easier comparison, we will stick with 200 as the number to purchase. Keep in mind the overall cost will be cheaper if you choose to purchase a larger quantity.
If you buy 200 yellow letters from Yellow Letters Complete, the cost will come out to be $238 with no add-on features like first-class postage.
There are certainly other ways to look for your next real estate deal and gain leads. A great alternative is using the Multiple Listing Service (MLS) to get access to properties since there are always potential deals on the market.
You can get started on learning how to utilize the MLS right now through our free training that covers how to secure a constant stream of real estate deals without spending a dollar in marketing.
Other alternatives to yellow letters include:
Try out those methods listed above to increase your chances of obtaining the property.
Staying consistent with your efforts over time is key to seeing the results you want. Chances are, you won’t hear from many homeowners the first round of yellow letters you send. You may have to send it two, three, or even four times to start getting phone calls.
There’s no doubt that these personal letters will grab property owners’ attention but remember, the goal is to also have them contact you.
Depending on your budget, try to send mail to a property owner at least once per month. Again, the key is consistency, so expect to mail each owner for at least 6-12 months before adjusting your approach.
Keep track of when they have received the direct mail. If there’s no response after one month, mail them another letter. Don’t give up and lose hope. Once you close your first real estate deal, it will more than pay for all the time and money you spent on the yellow letter campaign.
The average yellow letter response rate is around 8% and consists of all kinds of calls: angry calls, curious calls, tire-kickers, and quality calls. Your response rate will depend on several variables. Here are some factors that will either increase or decrease your success:
Mailing yellow letters have proven to work for many real estate investors and marketers. You don’t need to be an expert to use this method, but be prepared to spend money and commit time to master this strategy before reaping the rewards.
Just because mailing out yellow letters is old fashioned doesn’t mean it doesn’t work anymore. Many real estate investors still use this method today and consistently land deals from it.
They add that personalized touch that most other forms of marketing cannot achieve. The only downside to them is it takes a lot of time and investment, but the methods we mentioned like photocopying or using a direct mailing service will help with that.
No matter what your budget is, there is a method for you to produce high-quality yellow letters.
There’s no harm in trying it out for several months. You might just get lucky and receive a response the first time you send one out!
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