I recently asked an agent what they were doing for lead generation. Zillow was one of their sources. Here’s how the conversation went with one prospect.
Agent: “Hello, this is Luke Skywalker (names have been changed to protect the innocent). How can I help you?”
Lead: [weird, heavy breathing] “Hi, this is Darth. I had a question about 123 Tattoine St.”
Agent: “Great, I know that property well! What would you like to know?”
Lead: “Is that wallpaper in the dining room green or gray?”
Not all leads are created equal, but this is often par for the course when it comes to online real estate leads. In this article, I’d like to put forth to you that not only are investors (and investor leads) easier to deal with, but they are also considerably more valuable. Plus, I’ll give you some tips to finding more investors to work with.
Data Over Drama
When I first started my journey in real estate, I got my real estate license with the intent of quitting my awful job. That was it. I worked really hard for eight months and made that happen. At that point, I didn’t know what BiggerPockets was (a clothing brand?), nor did I know what real estate investing was. That was about to change, but not right away.
In my second year of selling real estate, a property manager friend of mine texted me a link to the latest BiggerPockets podcast. I listened to it on my way home from an evening showing and was floored. Where had this been all my life? And how could I start investing like—today?
Fast forward a few months, and I started investing with a partner. We were off to the races.
There were two things that struck me as we started investing. First, it was a lot more fun on the investment side of things. I actually looked forward to finding and showing properties for my investor clients. Not only did I have some insight for them, but I also learned from their experience.
The investors I worked with didn’t care about pink drapes or old cabinets or the smell of pets. All they cared about were numbers. How much is it to fix up? What is the after-repair value (ARV)? What will it rent for?
This was far different than the retail buyers and sellers I had worked with. I’d had clients pass up on great properties because of the smell, the paint colors, and the mismatched appliances. You name it!
This is what I refer to as “data over drama”. Investors are a different breed that typically only care about one thing, the numbers. It’s unemotional. If you’re working on the retail side, it’s almost 100% emotion, and not always in a good way.
I made a mistake the other day when I was speaking with an agent about our Featured Agent program when I referenced a statistic about retail buyers and sellers. The old stat had said that buyers and sellers trade real estate, on average, every seven years. The agent corrected me and said that the new data shows that now it is every 10 years. Some of the most recent findings even show that it’s as much as 13 years! That’s a long time to wait for a repeat sale.
Investors have an obsession with acquiring more and more properties. I have yet to meet a real estate investor who has just one property unless they are just getting started. Real estate investors frequently trade to put their portfolios in the best position for long-term wealth. I don’t have clear statistics on this, but if I had to guess, I would say the average investor buys or sells every three years. That’s a lot better than 10! And the numbers tend to get bigger with each transaction.
Just as a one-off example, if I’m looking back at my investing over the last seven years, I averaged buying over five units per year based on our current portfolio. Wouldn’t you like to work with someone like me if you were a real estate agent?
The Riches are in the Niches
You’ve probably heard this before, right? Niche down, and don’t be a clown. I made that last one up, but you can’t deny that there is something to be said for specialization. Most agents, when they get started, don’t give any thought to this, and it ends up hurting them. 87% of agents quit within their first year! There are many factors at play here, but when you jump in the deep end, and you don’t know how to swim, you’re in big trouble.
There are about three million licensed agents in the U.S. The problem is that 90% of agents are competing for the same clients—retail buyers and sellers! Would you rather compete with 2.7 million agents or a mere 300,000?
Makes Sense. Now What?
Let’s assume I’ve swayed your opinion to working with investors. How do I go about doing this? I’m glad you asked.
When I started investing, I asked myself the same question. The obvious answer was BiggerPockets. Let’s dive into a few ways to leverage BiggerPockets for more, and sometimes bigger, commissions.
Free, Pro, Premium?
There are three levels of membership on BiggerPockets. You should at least be a free member because, well, it’s free! Pro and Premium offer a few additional benefits like unlimited use of the calculators, which in my mind, is totally worth it just for that. Premium even has a lead capture function that can help you get more organic leads on BiggerPockets.
Post, Post, Post
Once you know which membership makes the most sense for you, it’s time to get busy on the forums. Now, this is not for everyone. But, for those who are willing to put in the time and effort, posting can lead to connecting with the right investors for your business. Let’s go over a couple of quick tips:
In settings, go set up your keyword alerts. This will most likely be the city, suburbs, and area you serve. Put in all the names, zip codes, and any other topics you’re interested in. When these are mentioned in the forums, you’ll get an alert! Then you can add your two cents to the conversation.
Make your own posts
What’s even more powerful, in my mind, is to make your own posts on BiggerPockets. I recommend doing a weekly market update or something similar. When you are the original poster, a couple of things happen. First, you control the topic. Second, people view you as the expert in that market and will always be replying to you. Third, investors who have their keyword alerts set up will get notified when you post! And, over the long term, BiggerPockets is very searchable. I still get leads to this day from posts I made five years ago.
Real estate investor meetups are, quite frankly, awesome. You get to meet with like-minded people who have similar goals. However, not all meetups are created equally. Some are big. Some are small. Some are paid. Some are free. When I was looking for a local meetup, there actually wasn’t anything close by. So what did I do? I started my own.
If you’re a Pro or Premium member, you can post meetups from the meetups thread on BiggerPockets. The benefit of hosting your own is that you’re in control. You can make it formal or informal or require all participants to wear a Waldo hat to attend. It’s up to you.
When you are the founder of the group, guess what? People look up to you. Even if you don’t have a ton of experience. You are viewed as the leader and connector. Even though my first group was small, I collaborated on several deals and met a lot of great people.
Become a Featured Agent
If the last few paragraphs aren’t for you, that’s ok. There is a shortcut. It’s called the Featured Agent program. Full disclosure, I am a rep for that program. So get in touch with me if you want to make more money!
When investors are ready to connect with an investor-friendly agent, they hop on BiggerPockets, click on Find An Agent, put in the location, and then are guided through some questions before being shown our Featured Agent page for that market. You can think of that page as a dating website. The investor is looking for the perfect match. Will you be their dream come true?
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If you are an agent and an investor and like working with other investors, it is most likely in your best interest to work in this niche. You’ll work less, make more, and have more control over your time. Sound too good to be true? Not at all. Welcome to freedom.
Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.