A real estate investor needs to consistently generate leads to find new business at a sustainable rate. This acquired skill can take years to master, and it's tough to establish traction when you're first starting.
So if you are a new real estate investor how do you get started generating leads? To learn you have to take a look at what the professionals are up to.
What is Lead Generation?
Lead generation is the process through which organizations find and capture the interest of potential clients. Real estate investors have long relied on lead generation strategies to find buyers and sellers.
Lead generation usually involves traditional cold calling, direct mail, recommendations, and other tried-and-true tactics. But with the rise of digital marketing there are now multiple options to obtain leads, including content marketing, blogging, social media, SEO, videos, and other channels.
Ways Real Estate Investors Get Leads
From traditional methods to new tech-savvy strategies, here are some of the ways real estate investors can get leads:
1. Direct Mail
A common lead-generating approach that every successful real estate agent has attempted at least once is direct mail. This method entails writing offer letters or sending postcards to potential prospects in your target market.
The type of mail you use may vary. Regardless, direct mailing promotes your services, gives potential customers a way to contact you, and includes valuable information about the real estate market.
Moreover, if you opt for an automated direct mail tool, you can deploy drip campaigns to engage with prospects over long periods with no ongoing effort on your part.
2. Cold Calling
Cold calling has been around for a long time as a lead generation strategy in a variety of industries.. This method involves compiling a list of possible buyer or seller leads and calling them to measure their interest in your services.
It is essential to deliver a practiced and well-prepared message after dialing when using cold calling. It can be a quick and easy technique for getting leads on distressed properties and uncovering excellent deals on houses to flip quickly.
You can get affordable call lists from a variety of lead sources. You can also drive around your area of interest and look through the newspaper for seller's contact information.
3. Skip Tracing
In real estate, skip tracing is locating the owner of a property. Real estate investors use it to find specific categories of owners and properties as well as distressed homes fit for flipping.
Skip tracing services are available in various levels of detail, and you can get them from individuals, software, and companies. You can use the services that provide basic information if you just want to execute a direct mail campaign but you can benefit from having the additional property details if you plan on calling each owner. And if you're looking for multifamily residences or commercial real estate, you need to conduct more in-depth searches.
Networking and letting everyone you encounter know how to help is probably the most effective thing for generating real estate leads without spending any money.
Joining the local real estate investing club and attending meetings and events is a great approach to start networking. There are numerous regional and national real estate associations, networking events, and conferences that can enhance your local networking efforts. Because you're not in direct competition with them, some of your national contacts may be more willing to share information and advice.
Building a solid and reliable network takes a lot of effort and time. However, having a huge network of specialists, such as accountants, title professionals, real estate agents, and tax advisers can be incredibly useful in your business.
It is vital to make sure your network of specialists is up to speed on the current market or types of homes you are interested in.
5. Driving for Dollars
Driving for dollars means going through neighborhoods physically looking for properties to buy and distressed homes to flip. It can not only help you obtain real estate leads, but it can also provide you with hands-on knowledge of a specific local market.
Driving for Dollars takes a lot of time and effort, not to mention a lot of wear and tear on your car. Many seasoned investors will delegate this task to someone on their team who understands what they are looking for.
Driving around a neighborhood can help you identify properties that will come to market soon or are in the foreclosure process before they hit any database.
6. Hire Bird Dogs
Bird dogs are people who will drive for dollars and find motivated sellers and distressed homes for real estate investors.
Workers, such as emergency responders, post office, and delivery people that spend a lot of time traveling around communities can make good bird dogs and provide you with valuable insider information about your targeted neighborhoods.
They will usually offer such services in return for a flat charge or a portion of the final purchase. Before going for this approach you need to be aware of your local and state laws regarding bird dog activities.
7. Digital Marketing
Because of real estate digital marketing, savvy real estate agents and new investors have the chance of making a huge impact online using content, websites, marketing analytics, sponsored content, and more.
There are numerous benefits of digital marketing. Firstly, digital advertising is often less expensive than traditional advertising. Secondly, metrics like clicks, visitors, and visit duration help you keep track of your spending and make modifications to make sure your return on investment is high.
Whether you use social media marketing, paid ads, blogs, or SEO, your digital marketing efforts should align with your business's overarching strategies.
8. Social Media
Social media can provide a direct line of communication with potential customers for real estate lead generation.
According to Statista, 98 percent of Americans aged 41 to 55 utilized the internet to look for a home in 2020. And 57 percent of online property hunters use social media apps daily to connect with them. (National Association of Realtors)
Social media gives you low-cost tools to get the upper hand. These include developing geo-targeted ads to attract leads in local marketplaces, deploying different analytics tools, and tailoring ads to specific groups. But the most significant advantage of social media is the ability to directly and easily engage with potential customers on neutral ground.
Most consumers will check for information online before making a phone call. So having a good website is a must-have.
Real estate agents now recognize the value of having a digital presence through websites, social media, or blogs. But setting up a website for your real estate business is a significant opportunity to acquire leads and establish credibility.
Besides having a fast and responsive website, real estate investors also need to focus on search-engine friendly content to ensure their websites are noticed.
Increasing your website traffic is essential if you want your website to succeed. You can do this by including exit pop-ups, email opt-in forms, Google and Facebook remarketing, and other similar features on your website.
Writing blog posts can help you establish yourself as a trustworthy source in real estate or your unique investing niche. If you integrate blog functionality into the back-end of your website, publishing blogs is low-cost.
You can increase the chances of lead conversion by bringing traffic to your website by giving practical, high-quality information.
While traditional advertising is an excellent way to find potential customers in specific areas, digital advertising allows you to reach a wider audience.
Any prospective homebuyer today conducts preliminary research on the internet. Because search engines like Google are likely to be their first destination, utilizing Google Ads is a great way to get some attention.
You can also consider advertising on Facebook, Instagram, Pinterest, and Youtube, in addition to search engines.
12. Word of Mouth
In real estate, word of mouth is extremely important. When you spread the word that you're a real estate investor to as many people as possible, they'll remember you if they ever want to sell their home.
Make it a habit to inform as many people as possible about your REI business and how it may assist them in selling a home quickly. Also make sure that everyone you work with can walk away with something positive to say about you.
This approach has two advantages: it gets your name and business card in front of potential real estate leads, and it gives you valuable self-promotion experience.
13. Online Lead Generation
Knowing where to look for real estate leads can be a frustrating challenge, but luckily there are loads of data available on the internet within a few clicks. There are a number of great websites that real estate investors rely on for generating leads and growing their business…
- Craigslist: This website is a fantastic resource for locating organic leads by location and market. Real estate investors can use the site to find leads for distressed or for-sale properties.
- Trulia: For real estate investors seeking in-depth search criteria options, Trulia is an excellent website to visit. This user-friendly site provides detailed market data and allows easy and deep searches.
- Loopnet: This website is a go-to place for people looking for commercial real estate leads since it gives them access to an extensive portfolio of investment properties.
- Auction: Auction.com hosts auctions for various real estate types, including bank-owned, foreclosed, and short-sale properties. Investors can use this website to participate in online auctions.
- Realtor: Realtor.com, the official website of the National Association of Realtors, offers listings from over 800 multiple listing services. Users can use this website to specifically search for foreclosures, sign up for email alerts, and more.
- PropertyShark: PropertyShark is an excellent source of property records that complements all of the sites mentioned above. This website assists an investor in identifying the owner and address of a lead, assessed taxes, purchase price, and other property information.
14. HUD Foreclosures
HUD properties are homes that the US Department of Housing and Urban Development (HUD) purchased due to a foreclosure on an FHA-insured mortgage. HUD auctions and markets such reclaimed properties on their website in an attempt to recoup their losses.
HUD foreclosures present excellent opportunities to purchase a home at a significant discount, but you must act fast because top properties attract attention. However, like with any foreclosure, do your research in advance to avoid surprises.
15. Hire a Lead Generation Company
Lastly, if you're too busy to generate leads on your own you can hire a lead-generating firm to handle the work for you. While this method saves time and provides convenience, it also deprives you of some fine-tuned control over your lead creation efforts and will cost you good money.
If you plan to use this tactic as your primary lead-generating method, be sure the company you chose provides you with exclusive leads, so you're not vying for the qualified leads with other real estate agents they may also be working with.
Lead generation is a crucial component of growing your real estate investing business and should be part of every investor's daily routine.
Your competitors may be using the same standard lead generation methods, which means it's essential to develop creative ways to reach potential customers. The best lead generation form for you ultimately comes down to your business goals and own personal strengths.