There are a number of factors involved when figuring out what your monthly budget should be for your marketing. You could ask 10 real estate investors what their budget is and most likely, they’ll give you 10 different responses.
Not only is your budget dependent on your spending ability for your business, but how hot your market is and your market strategy are also major factors to consider.
When considering what to set your budget at, consider the long-term.
You don’t want to spend $3,000 your first month going all out in your marketing and have nothing left for the following months. Ideally, you should be mailing to the same list multiple times so that your name is front of leads when they decide it’s time to talk to an investor.
When starting out, you might not have had a deal close for a few months so don’t rely on incoming profits to fund your marketing at the beginning.
Once you build up your business and are having deals close on a semi-steady schedule, you’ll better be able to allot some of your profits to go back into your marketing budget.
Plan out for 3-6 months worth of marketing so that you can consistently follow up with leads.

How Hot Is Your Market?

If you’re investing in a market with a lot of other investors or in a market that’s hot in general, you’re probably going to have to either spend more in marketing or get more creative.
You have to decide if you want to play ball with dozens of other investors who are looking at the same properties as you or if you want to try to expand to another market that isn’t as hot and you may not know as well.
It’s easy to get lost or discouraged when you’re in markets that are saturated with other investors because your dollar isn’t stretching as far when compared to less active markets.
For those who don’t have the option to simply boost their marketing budget to accommodate for the hot market, you might need to reconsider the avenues you’re using to advertising.

Get Creative with Marketing

Direct mail is great but if you’re buying the same lists as everyone else, your conversion rate will likely be lower as the seller has multiple options in front of them to choose from. If you’re able to customize your list to a targeted list of motivated sellers with specific criteria, it might give you an edge so your direct mail budget is more effective.  
Online marketing is cost effective but it takes time to perfect. You should have a website has everything the seller needs to know about your business, including how to get in contact with you.
Pay-per-click and Facebook advertising is another option that can get your business in front of motivated sellers. For both pay-per-click and paid Facebook advertising, you can set your daily budget that will be spent. It’s a bit more complicated than just setting your daily budget but this allows you to stay within your monthly marketing budget easier.
If you have friends in the area you’re investing in, let them know on Facebook that you’re looking for investment deals. Some might know of a friend or family member who might be looking for help with a property they own and can connect you with them. It’s a simple method that can bring a few deals to your table and it’s free. Also, you’re hitting an audience that isn’t being targeted by other investors most likely!

Trial and Error

Every market is different. With your marketing, it’s important to pay attention to where your leads are coming in from so you know where it makes sense to allocate your marketing dollars.
For any strategy, don’t quit after just a month or two. You need a good 3-4 months worth of follow-up to determine if a strategy is working for you or not.
It’s okay to change it up!
Many investors do a combination of direct mail and online marketing. Find a strategy that works for your budget and your market and try it out. If it doesn’t seem to be producing enough leads after 3-4 months, reevaluate and try something else.

Your Budget is Custom to You

You can get guidance from other local investors but they’re going off their experience and what worked for them might not work for you today.
Come up with a marketing plan that is going to work for your budget and your market. Give it a few months to see how your conversions are and if it’s not working, you can always try another vehicle for your marketing.
Unfortunately, there isn’t a “magic number” that we can tell you to use as your marketing budget. Over time, it’ll become more obvious as to what’s working and what isn’t.
Danny John shares “How to Make Sure Your Marketing is Cost Effectiveon a recent REI Classroom if you’d like to check it out!
As your business grows, you’re going to be able to scale your marketing budget so that it matches the volume you’re wanting to do. Pay attention to your lead conversion rates and fine tune your marketing budget so it aligns with your market, your overall budget, and your business model.

Hannah Alley

Hannah Alley

I'm the operations manager here at and have a passion for real estate investing and have a background in writing and business. I focus on providing content that is aimed for newer real estate investors and those who have the drive to become a full-time real estate investor. With so many strategies to utilize within the real estate investing industry, I aim to break down any barriers and showcase that real estate investing is obtainable and can truly bring financial freedom.

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