This is part two of the series on how to become the most effective real estate lead-generating master in the real estate game. Be sure to read part one first.
Now that you are laser locked on your target property type, area and price range, it’s time to flip the switch and get those real estate leads flowing.
One of the best ways to protect yourself from making desperate, and therefore costly, decisions as a real estate investor is by becoming a lead generating machine. You need frequent leads because the majority of deals that come to you won’t be good ones. Expect that and stay persistent.
Having lots of leads will stave off the desperation that can creep in and cause even experienced investors to make poor purchasing decisions.
100 Millionaire investors were interviewed about how they tackled lead generation. I pitted their polling results against my personal experience, and I have to agree with the outcome. The results may surprise you.
There are six methods that account for only 30% of deals.
- 2% of deals – ONLY 2% – are generated from direct mail. Think postcard. Think form letter. Think expensive.
- 3% of deals come from internet marketing. I’ve seen some success with internet marketing, but you’d better possess deep knowledge or you won’t see results.
- 4% come from FSBO’s. For Sale By Owner. These are great practice, but aren’t typically your home run deals.
- 7% are found from foreclosure listings. Competition is tough in this arena. People are stressed, and generally it requires cash to play.
- 9% of deals are found in newspapers or classified ads.
- 5% are filed under ‘others’. These are the random and insignificant ways of finding deals. Not particularly useful to us.
That’s quite a few methods without considerable results.
Which leaves 3 methods that account for 70% OF DEALS
- 10% are found driving and walking neighborhoods. Since you know your area and what you’re looking for, this shouldn’t be tough, plus it’s free.
- 28% are listed through Realtors on the MLS. It’s much easier to buy property from the MLS for cash flow than for equity, so keep that in mind.
- 32% of deals are found through NETWORKING. If there were a golden ticket, networking would be it. [Learn how to network and build your team]
Experience has taught me that the more money a lead generation source costs upfront, the less effective it is. Networking and walking a neighborhood costs you nothing.
So, let’s talk about networking. Real estate is a people business, and your number one weapon as an investor is your ability to connect with people.
Begin by telling EVERYONE you know about what you’re doing. Make them aware that you’re buying houses and are looking for property owners who could use some help.
Nobody does business in a cave.
Be proactive. Build your database. Stay in touch.
Remember when we talked about identifying the people who can connect you to the type of real estate that meets your criteria? Go talk to them!
The majority of my leads come from nurturing and building my network through attending networking events and seminars, but there are other effective ways of finding deals.
I post ads on craigslist, backpage, and ebay classifieds daily as well as sending handwritten yellow letters to a targeted list of people.
I know I said no direct mail, but this little yellow letter, unlike a post card, yields a 15% return!
If you’d like to see exactly what the ads say, and how I specifically write the letter, I’ll show you. Check out my free course, How to do deals; No Money Required.
HOWEVER I’d be doing you a disservice if I didn’t include this: You can send a million post cards, post a thousand ads, and write a five hundred letters, but if you can’t connect to the person on the other end of the phone, listen to them, have them trust you – then you’re not going to make a dime in real estate.
Next week, I’ll be sharing the fastest path to creating rapport with people. It’s a simple step-by-step formula that will launch your people skills into the next realm of awesome so that when those yellow letter leads start calling, you’ll be ready.
See you then!
[If you missed Part One of How to Be a Real Estate Lead Generating Machine… catch up here.]