03 Jul Generating leads in a hot market
As with most businesses, generating leads is an important part of the terms (creative financing) niche. If you can’t generate leads, you’ll never be able to take on new deals. We have a number of tried and tested systems for generating leads that work nine times out of ten.
But what happens when those systems dry up? Or there’s a lull in the market for whatever reason which typically is that it’s a hotter than normal market for sellers and they’re moving they’re properties more readily. The simple answer is… You need backup sources! Here’s what we do.
Our primary sources
We have a number of lead sources that we rely on for a baseline level of leads. Sometimes, these sources alone provide enough leads for us to stay busy.
For us, this is primarily via a database on MyPlusLeads. This gives us huge lists of expired listings, for sale by owners (FSBOs) and for rent by owners (FRBOs). We have it set up so that these leads just flow into our system, and we often automate the process of reaching out to them or we have people on our team that handle making the calls. Any and all of the tools we use are readily available to you at https://www.smartrealestate.com/resources.
If you’ve followed us for any length of time, you probably know that we get the majority of our leads from these sources. Expired listings, for example, are a huge source of leads for us. And because we pay a monthly fee for this service, it’s very easy to justify the costs.
We think of this like our “foundation” for lead generation. We always try to utilize these sources as much as possible—but if they dry up, we have alternatives.
Pivoting with multiple sources
We talk a lot about pivoting within deals, but the same goes for lead generation. If one lead source isn’t working for you, you can’t just sit there and wait for something to change. You need to pivot to an additional source, and that’s why we always recommend having multiple lead sources at your fingertips. I call this, fishing in a different pond.
Nowadays, you can create lists for almost anything. So when our database isn’t giving us the leads we need, we start utilizing other services to generate very specific lists of niche people.
For example, we use another service called Propstream (https://www.smartrealestatecoach.com/propstream) to generate lists of people who are free and clear on their homes—perfect candidates for owner financing deals. We can generate lists for practically any type of niche within real estate, so we can get very strategic about who we want to reach out to. Another we love right now is tired landlords, especially coming out of COVID, as well as out of state owners.
This is just one system we use, but it provides us with near endless sources for leads because we can create such targeted lists.
Understanding the numbers
The one caveat with generating custom lists like this is that you need to have your numbers down. You need to have a marketing budget and you need to understand some key metrics to know whether you’re getting a decent ROI or not. These generated lists can give you almost instant leads, which is enticing—but it doesn’t necessarily mean you’re going to make money from them.
One metric that you should understand before you start adding multiple lead sources to your marketing strategy is cost per lead. How much, on average, does it cost for you to acquire a lead? You can start to calculate this as you create additional lists and it will give you a very clear indicator of whether a specific source is working or not.
Simply take the amount you’ve paid for one lead source and divide it by the number of leads you’ve received from it, and you’ll have the cost per lead. From there, you can decide which sources are providing the best ROI and continue to double down on those.
Once you’re able to work multiple sources into your lead generation and track metrics to understand which sources are performing best, you’ll be set up to weather any dry spell when it comes to leads.