So you are all geared up and ready to make this business work. Your brain is swarming with ideas, every house you see driving down the road is looking like dollar signs, and you are just itching to get a hold of a deal so you can cash in on those big dollars you see other real estate investors making. You are going to all the local real estate investor meetings, building your power team, and setting up your LLC so you can get your new business cards printed.
Fast forward a few months, a few thousand dollars, a whole lot of time, and still no property to cash in on. What’s going wrong here? Where are all of these deals real estate investors talk about? When am I finally going to make it big? How do I make this real estate investing thing work?
Do you want people begging you to sell their house?
Easy! The number one mistake I have seen new, and even some seasoned real estate investors make, is they fail to market their business properly. So many people go through all of the steps of building power teams, setting up LLCs and yet never seem to make a deal happen. If you wanted to buy a new TV I’m certain you could immediately think of where you would go. It’s time to trade in your car – there are probably a dozen car lots in the back of your mind you could take it to.
They need to know who you are!
When most people end up in a bad situation with a house they don’t know who to call, or what their options are. You need to get out there and make your presence known as a real estate investor. Unlike the big box stores people have no clue who you are or that you are wanting to buy their house. You need to become the go to person in your area for solving people’s real estate problems. People need to know that you have options for them, and this takes time to build.
Ok, so how can I do that?
Marketing is the heart of your real estate investing business that keeps the money flowing. Without a strong, consistent targeted marketing effort, your business will be unable to thrive. First I will list a few people that you should consider marketing to, then I will break the marketing down into two main segments consisting of free and paid for. Free marketing will generally cost nothing and be very time intensive, and paid for will usually be less time but more money. Once you start laying down the foundation for a strong marketing plan, and begin to implement your plan consistently your lead pipe will begin to fill up, and so will your bank accounts.
Know your audience
Marketing is great, but only if you have the right people calling you. So who is it you are reaching out to and how do you find them. Below is a list of different motivators that might indicate a distressed home owner that is looking to sell fast.
|Absentee Owners||Behind on Taxes||Behind on Payments||Pre-Foreclosure|
You can get these lists either by compiling them yourself from different sources such as the county clerk’s office, or buy purchasing them from list providers such as www.listsource.com. Finding people who have multiple motivations is an even better list. Example – absentee owner with a vacant house, and behind on taxes would be an excellent targeted seller.
Who said free doesn’t work?
Below is a compilation of ways that you can generate leads that will cost you little to nothing. I don’t care what anyone says these methods work, but only if you put in consistent diligent effort.
- Online Classifieds/Craigslist – This is a tried and true method that is completely free, and because it is free it is very competitive. The key to this game is consistent postings, and the right amount of them To learn more about how to become an effective Craigslist advertiser you can watch many short videos on YouTube or read any of a number of different articles.
- Referrals – Believe it or not if you just asked every single person you met if they knew somebody that was having problems with their home and would like to sell you would start getting some leads. Even if they don’t, leave them with your business card, and let them know you are actively seeking properties and that you pay generous referral fees for properties that meet your criteria. This leads me to…..
- Bird Dogs – If you take the time to grow the relationships needed to vreate a strong bird dog network you will never need anything else. Take the time to teach them what you want, show them how to present it to you, and follow through on what they provide you. You do well at this and you may never need to do anything else.
- Driving for dollars – Although not completely free it is close. When out and about doing your daily chores try taking the back roads or alternative routes, and take note of properties that look vacant or seem in disrepair. Take the time to stop and put a sticky note on the door with your name and number asking to buy their house. Take note of the address and when you get home look up the owners name and mailing address. Send them a letter asking to buy their home etc.
- Real Estate Agents – Don’t abuse or waste an agents time, but if you pair up with the right agent you can find some great deals. Now remember you are looking for a real “go getter” and just because your friend/family member has a license doesn’t necessarily qualify them. You may have to try several different agents to find one who understands what you are doing, but once you do you will have a serious marketing machine on your hands.
I don’t have time for all that!
If time isn’t on your side then you better be ready to pay for someone else’s time. Here is a short list of things you can do to get your phone ringing with motivated sellers.
- Direct Mail – A critical piece to any investor’s toolbox. For large volumes of properties this method is a proven resource for deals. They key is consistency and finding a targeted list. You can do letters or postcards, but sending to a person more than once is critical. Don’t just send one and forget it, try to send at least 3-7 times before moving on.
- Bandit Signs – Although you may have problems from your local jurisdiction this works well. Ever seen a little yellow signs at the corner saying we buy houses? That’s a bandit sign. Drop them in high traffic areas on a Friday and wait for the phone to ring. Try to get out as many as you can. I try for 30-40 a week in my targeted markets and saturate one area t a time, rotating from week to week the area I am targeting.
- Local Papers – Simple ad placed in local newspapers and classifieds letting people know that you are buying houses. Try using bold type if you can or larger ad placements.
- Car Signs – Got an empty rear window? Fill it up with a vinyl sign that says we buy houses and you now have a driving billboard. Does your friend’s car have an empty window? Try asking them to put a sign on their car also. Check out my blog on how I got almost 100 cars driving around with my advertising on them.
- Pay Per Click – If you or somebody you know has a little bit of internet know how then set up a PPC campaign from Google or Facebook, and get the traffic flowing to your websites. This is a simple yet effective way to boost your business using the internet. Even if you don’t know how, there are plenty of people out there who can help you set this up.
This might sound obvious, but answer the phone!!!
As crazy it sounds so many new real estate investors are absolutely terrified to answer the phone. If you are one of those people read this blog I wrote on how I get contracts buy offering them a $1 for their home. There are some good tips in there for how to get over the anxiety associated with talking to a seller. Once you are on the phone a good question to always ask is how did you hear about us. This lets you know what marketing is working the best for you so that you can focus your marketing dollars in the right areas.
The real estate investors who follow up best wins 😉
Keeping up with all of the leads is very important. You might not get the contract the first time you talk to the seller, may not the second or third, but if you are consistently communicating your chances are much higher than the person who called once and gave up. I have received contract almost a year later, it is all about timing and being the one there when the seller’s motivation meets reality. Quality auto responders and a good lead management system like Propelio is a must for any serious investor looking to capitalize on all of their marketing efforts. Remember, the key to this is consistent, targeted, quality effort, and the rest will fall into place. What mistakes have you made or seen others make? Leave me a message in the comments below!