There are many ways to grow your real estate business. Some investors focus solely on direct mail and marketing, while others look to build their business through fancy advertising. What works for one investor in one market may not work for someone else in another. One method that often produces the best results is focusing on local contacts. These are the people that you come in contact with every day, and probably don’t give much thought. You may have established a working relationship, but really haven’t asked for referrals. However, these local contacts should be the cornerstone of your business.
A wholesale investor can be one of the greatest lead generation sources you have at your disposal. Wholesalers work to find deals and quickly pass them along. They only make money when, and if, the property closes. Having said that, it is essential for them to find good deals. A solid core of wholesalers can provide you with multiple lead opportunities every week. Finding them is often much easier than you may think. For starters, they are typically at every local real estate investment group or club. You can also find them in your everyday travels. Many wholesalers place bandit signs in your area. Every time you see a “we buy houses” sign, you should be on the phone calling them. Some of these signs will be from end investors, but many will be from investors looking to build their wholesale business. The only way to find out is by calling. Not every deal that a wholesaler gets will fit with what you are looking for, but these leads don’t cost you a dime. Once you close a deal or two with a wholesaler, you can bet you will be their first call when a new deal comes their way.
Working with the right real estate agent can open doors you may not have thought of. A real estate agent’s role is much larger than simply submitting offers and showing properties. They are one of the first points of contact for bank-owned or foreclosed listings. Once you let it be known that you are a serious investor who can close quickly, you may be given first crack by your Realtor to make an offer. Not every Realtor excels at both sides of the deal. Some are better at listing properties than they are at working with buyers. If you have down time, make a point at least once a week to get on the road and meet with local Realtors. There are many who have access to these properties and need cash buyers. By spending a few hours a week meeting local them, you will put yourself on their radar. When they have a deal in the future, you may be on their short list of people to call.
Local mortgage brokers are a great local contact to have. Not only will they help you finance the deals you are working on, but oftentimes have deals at their disposal. A good mortgage broker will work with buyers, sellers and fellow investors throughout the area. It is not uncommon for them to work with distressed homeowners who are out of mortgage options. Knowing this, they may be looking for a quick sale just to get out of the property. Additionally, they may know an attorney, fellow local investor or accountant that has access to deals or is looking for a deal on their own. On most mortgage transactions, there is a buyer, seller, two attorneys, appraiser and two real estate agents. A mortgage broker can be in the middle of all of these. At least a few times a month they will have a deal or a situation that may need the services of a local investor. Take the time to introduce yourself to as many mortgage brokers as possible. Not only can you come across a new program, but you will likely find a deal or two along the way.
All roads in a real estate transaction lead to an attorney. There are many different areas of practice that a local attorney can take. While you may think that a real estate attorney would be the best lead source, this is not always the case. Between divorce, estate and probate; there are other areas that could help your business. Finding attorneys is not as easy as the previous three options. The best way to initiate contact is through an email campaign. It is important not to get discouraged if you do not see quick results. If you commit to sending half a dozen precise emails, you will start to see results. Regardless of what the area of practice is, attorneys talk. Once you establish yourself as a reliable investor, there will be more attorney leads headed your way.
By generating a strong local contact base, you increase the chances of turning a lead into a deal. Additionally, these leads will not cost you a dime. Walking into an office or sending a few emails will not guarantee that people will want to work with you. This is often a process that takes several weeks, if not months. Even when you do get a lead, you need to make sure you treat it like gold. Leads from local wholesalers, real estate agents, mortgage brokers and attorneys can turn an average business into a great one.