Most real estate investors rely on some type of marketing in order for their business to get deals. Real estate investors typically send out thousands of pieces of mail or other types of marketing pieces with the expectation that a small percentage will be good leads. It’s a funnel. You hope for a certain percentage of people to reach back out to you and of that list that reaches out to you, a small percentage will have a property that fits your criteria and you move further into seeing if it’s a good deal for you or not.
Out of those who reach out, while some are hot leads that are perfect for wholesaling, rehabbing, or buying and holding, many aren’t.
So, what do you do with leads that don’t meet your criteria or don’t turn into a deal immediately?
Most investors just toss them to the side, never to be thought of again.
If the seller isn’t ready to sell yet but might be in the future and the house fits your buying criteria, you should follow up with them consistently, every month or two. When the time comes that they are ready to sell, you want to be first in their mind. By having your information in front of them because you continued to mail to them, you’re more likely to be someone they reach out to.
These follow ups are a great task for VAs, by the way. Many times, the investor doesn’t have time to spend following up with lukewarm leads but this is a routine task that you can train a virtual assistant on and it’s part of their everyday tasks. Have them check in on the seller by phone on a schedule and if by chance they say they already sold the property, have your VA check public records to verify that the purchase went through. Not many do this and if the other buyer falls through, you can have a chance to give them your offer.
Often times, you’ll have people call you back simply because they’re trying to avoid realtor fees and think you might be the solution for saving a bit of money. If they aren’t wanting to pay that percentage, they most likely aren’t going to entertain your offer of 70% ARV minus repairs. This is especially true if the house is newer, doesn’t need many repairs, and doesn’t have a lot of equity in it.
It’s the perfect time to politely let them know how your business works and let them know they probably wouldn’t like your offer.
For leads that are wanting essentially a full-price offer, you might send them over to a local realtor who you know and are building rapport with. This provides the seller a next step to take and helps the realtor out as well.
This act of giving provides no monetary value for your company but having a good business relationship with a few reputable realtors in your area is simply good business.
Later down the road, if the realtor has an off-market deal that they simply can’t put on MLS, they might think of you and return the favor by sending them your way.
This way, your leads aren’t wasted, the seller has a recommendation of what to do with the property, you’re helping out another small business by sending the lead to the realtor, and later on, you might be sent a deal that wouldn’t have come your way otherwise.
If you get a hot lead that is too far out of your market and you don’t feel comfortable pursuing it, don’t toss it away! If you network with other local investors, you’ll likely know someone who invests out in that specific area and you can potentially partner on them if the deal works out. The other investor would be your boots on the ground and you found the deal so it could be a win-win for both parties.
You’re likely paying a good amount of money on marketing so always work on getting the most out of every lead.
If there is any motivation at all, follow up with them as long as you can. We’ve gotten deals from leads that were YEARS old. Check in with them and eventually, the time might be right and you’re likely one of the few who are still reaching out. By then, they’ll know your brand and your business. Always be respectful on the follow ups, build rapport, and get the deal done!