Cheap Real Estate Leads to Go After (or Avoid) in 2024

Symbol,For,Choosing,Quality,Instead,Of,A,Cheap,Price.,TwoBuying leads can be a tempting shortcut for new real estate agents, but it’s important to understand that not all leads are created equal.

Often times, you get what you pay for…and more than that, sometimes the cheap leads end up being a LOT more expensive to work.

Why are cheap leads more expensive to work?

Well for one, you need a CRM, a dialer, email tool etc. to make these leads valuable, otherwise you’re going to waste a ton of time working them. In a lot of cases, these leads need nurturing for a LONG time before they are ever really ready to buy or sell. 

Best Ways to Get Cheap Real Estate Leads

Best for Getting Yelled At: FSBOs

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Top Features

: Specific lead gen tools sell these leads exclusively

One type of lead to avoid are FSBO (For Sale By Owner) leads. These leads can be difficult because they’re not listed on the Multiple Listing Service (MLS).

Here’s why that matters: Without being listed on the MLS, FSBO properties are not easily visible. On top of that, FSBO properties are often marketed by the owners themselves, which means that realtors don’t have a clear point of contact for negotiations.

But, if you like getting yelled at, these may be the best leads for you!  These can be very difficult to convert since the sellers have already made the decision to sell on their own, and may not be interested in working with an agent at all.

They’re already getting hundreds of calls – unless you can really verbalize why you stick out, why would they hire you? Not to mention, FSBO properties may be priced higher than the market value, which makes it more difficult for you to convince your clients to consider them as viable options.

Overall, while FSBO properties can provide a good opportunity for buyers and sellers to save on commission fees, they can pose an all around challenge.

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FSBOs Pros
  • Not many people try to purchase FSBO leads
  • You know they have intent to sell
FSBOs Cons
  • Properties not priced competitively
  • Sellers may be difficult to work with

Best for Major Time Investment (that may actually pay off): Expired Listings

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Top Features

: These leads are very challenging, but can also be rewarding if you're able to close the deal

Here’s another type of lead that may not be worth the investment: expired listings. They might be a good source of potential clients, but they could have already been approached by other agents, making them resistant to working with someone new.

Keep in mind, they’ve already been on the market without selling, which can signal to potential buyers that there is something wrong with the property or the listing price. This can make it difficult for you to generate interest and attract potential buyers to the property.

On top of that, the seller of an expired listing may be frustrated and disappointed by the lack of interest in their property, which might make someone less cooperative (and less friendly) during the sales process.

In general, expired listings require more effort from real estate agents to reposition the property, overcome buyer objections, and establish trust with the seller, which can be time-consuming and challenging.

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Expired Listings Pros
  • If successful, highly likely to get repeat business
  • Typically cheap to find
Expired Listings Cons
  • Typically on the market for a long time
  • Sellers are usually not trusting of agents

Best for Inbound, Low Intent Leads: Facebook/Instagram Leads

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Top Features

: You'll know quickly if you're efforts are paying off

While it might be tempting to buy leads from social media platforms like Facebook or Instagram, these leads may not be as targeted or qualified as you’d hope.

The people on these platforms may not have the same level of intent as someone actively searching for properties on a real estate website or portal.

These leads also typically come from a variety of sources such as advertising campaigns or social media posts, so it’s hard to gauge where they’re at in the process. This can make it challenging to determine which leads to focus on and which ones to discard.

Communicating with leads through Facebook and Instagram can be difficult since it’s often not a direct form of communication and may take longer to respond. This could lead to potential leads losing interest or finding a different agent in the meantime.

A little piece of advice – Facebook and Instagram leads may be more tech-savvy and prefer to conduct their own research online before contacting a real estate agent, which could make them less responsive to outreach from agents.

Overall, while Facebook and Instagram can be valuable tools to generate leads, they require careful management and nurturing in order to convert them into actual clients.

In order to really close a deal, you need to be able to effectively filter through the leads, engage with them in a timely manner, and build a relationship of trust to ultimately lead to a successful transaction.

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Facebook/Instagram Leads Pros
  • Come from a variety of sources
  • Great for getting social media referrals
Facebook/Instagram Leads Cons
  • Buyers/sellers don't always have intent to work with you
  • Communication can be difficult

Best for Wasting Your Time: Cold Leads

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Top Features

: More expensive if you're just starting out because you need to have an established brand with marketing materials

Cold real estate leads, or leads that have not expressed any interest in buying or selling a property, can also be a waste of time and money.

These usually come from cold calling, sending postcards, or door knocking. It’s often better to focus on warmer leads that have shown some level of interest or engagement.

Additionally, cold leads may not be qualified, meaning they may not have the financial backing to purchase a property or may not be ready to move forward with the deal at all. Bottom line: Don’t do it.

Overall, while cold leads can be a potential source of new business for real estate agents, they require significant time and effort to convert into actual clients, and there is no guarantee that they will result in a successful transaction.

As a result, many real estate agents focus on building relationships with warm leads, such as referrals from satisfied clients or leads generated through marketing campaigns targeted to potential buyers and sellers who have already expressed interest in real estate.

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Cold Leads Pros
  • You can fit this into your down time
  • Gets easier the more you do it
Cold Leads Cons
  • Require lots of time, and nurturing
  • Branding and marketing can be a big expense

Best for Problems: Absentee Home Owners/Vacant Homes

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Top Features

: Tips and leads can help you locate these properties in your area

Absentee owners or vacant homes may not be good leads because there could be various reasons why a home is unoccupied, and not all of them indicate that the property is for sale.

For example, the property may be under renovation, the owners may have temporarily relocated, or the property may be used as a vacation home.

Additionally, absentee owners may not be actively involved in managing the property or even have a pressing need to sell the property, which can make it harder to engage with them and build that relationship and trust.

On top of that, vacant homes may be targets of vandalism, theft, or damage caused by environmental factors, which could reduce the property’s value and make it less attractive to potential buyers.

You have to consider that these issues might make it more challenging to sell the property at its full market value or to attract qualified buyers who are willing to take on the necessary repairs.

Overall, while absentee owners or vacant homes can potentially be good leads for real estate agents, they require careful research and due diligence to determine whether the property is available for sale and if the owner is a qualified lead.

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Absentee Home Owners/Vacant Homes Pros
  • Leads are fairly cheap to get
  • Don't have to worry about scheduling during open houses if they are vacant
Absentee Home Owners/Vacant Homes Cons
  • Often times these homes are targets of crime
  • Hard to make contact with homeowner

Best Cheap Real Estate Leads

While there are lots of cheap leads to avoid, or at least be wary of, there are also a ton of amazing real estate leads that won’t break the bank. Consider using these platforms to boost your business instead.

Best Cheap Real Estate Leads: New Facebook Referral Group

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Top Features

: Free to join, great way to get referrals and advice from successful agents around the country
Starting at $

Based on feedback from realtors who visit our site, we have created a brand new referral network group on Facebook.

The group is a private community of real estate professionals from around the country who are committed to supporting each other’s businesses by referring clients. If you have a client who is moving to an area you’re not licensed in, you use the group to find a realtor in their area who can help.

The best part? You get a referral fee. It’s also a great way to find new clients who are getting referred by other agents.

One of the best things about the Facebook group is that it’s not just about referrals. It’s also a great place to learn about real estate lead generation.

The members are very active and share their expertise on various topics, including marketing strategies, social media, and networking. You’ll find valuable resources, tips, and advice that you can apply to your own business.

When you join, don’t be shy! Please introduce yourself & share a question or strategy you’re using to grow your business.

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New Facebook Referral Group Pros
  • Free to join
  • EXCLUSIVE group for producing agents
  • Real questions and advice welcome
New Facebook Referral Group Cons
  • Must have a Facebook account
  • Few members right now
Starting at $

Ongoing Cheap Leads: Referrals From Past Clients

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Top Features

: Don't have to get to know them again, already know their interest and taste
Starting at $

Getting referrals from past clients is one of the most effective ways for real estate agents to generate new business. There are several benefits of receiving referrals from satisfied clients in real estate, including:

  1. Increased credibility: When a real estate agent receives a referral from a past client, it shows the client was satisfied with their services and is willing to recommend them to others. This can increase the agent’s credibility and reputation in the community, making it more likely that potential clients will trust them and want to work with them.
  2. More qualified leads: Referrals from past clients are often more qualified leads since they are already familiar with the agent’s services and have a genuine interest in buying or selling a property. These leads may also be more likely to be ready to move forward with a transaction, reducing the time and effort required to close the deal.
  3. Cost-effective marketing: Receiving referrals from past clients is a cost-effective form of marketing since it doesn’t require the agent to invest significant resources in advertising or other promotional activities. This can help real estate agents save money on marketing expenses and increase their return on investment.
  4. Stronger relationships: Building relationships with past clients is essential for long-term success in real estate. When a real estate agent receives referrals from satisfied clients, it indicates that they have established a strong relationship of trust with their clients, which can lead to repeat business and a steady stream of referrals in the future.

Overall, receiving referrals from past clients is an effective way for real estate agents to grow their business, increase their credibility, and build strong relationships with clients.

By providing exceptional service and asking for referrals, real estate agents can generate a steady stream of qualified leads and achieve long-term success in the industry.

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Referrals From Past Clients Pros
  • Get return business
  • Very cheap in the long run
Referrals From Past Clients Cons
  • Requires continuous nurturing
  • Must be very careful in managing the relationship
Starting at $

Pay More for Better Leads: Pre-Vetted Lead Source Companies

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Top Features

: Real Geeks, Market Leader, or CINC are some of the top companies
Starting at $-$$

Using a lead generation company in real estate can offer several benefits for agents looking to grow their business. Here are some of the pros of using a lead generation company:

  1. Increased Efficiency: A lead generation company can help you save time and effort by providing a steady stream of qualified leads that are already interested in buying or selling a property. This can allow agents to focus on closing deals and providing exceptional service to their clients, rather than spending time and resources on prospecting for new leads.
  2. Access to Niche Markets: Some lead generation companies specialize in providing leads in specific niches, such as luxury properties, commercial real estate, or distressed properties. This can give you access to markets that they may not have been able to reach on their own, allowing them to expand their business and increase their revenue.
  3. Cost-Effective Marketing: Lead generation companies typically charge a fee for their services, which can be more cost-effective than investing in traditional marketing activities such as advertising or direct mail campaigns. This can help you save money on marketing expenses and increase your return on investment.
  4. Scalability: Lead generation companies can provide agents with a scalable solution for generating leads, allowing them to increase their volume of leads as their business grows. This can help agents expand their business and reach their growth goals more quickly.
  5. High-Quality Leads: Lead generation companies use various methods to generate leads, including social media advertising, SEO optimization, and targeted email marketing campaigns. This can result in a higher quality of leads, as the leads are more likely to be interested in buying or selling a property and have already expressed some level of interest.

Overall, using a lead generation company in real estate can offer several benefits for agents. Remember, you should carefully research lead generation companies and choose one that fits your specific needs and goals.

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Pre-Vetted Lead Source Companies Pros
  • New leads coming in frequently
  • Leads come from a variety of sources
  • Can choose which company is right for you
Pre-Vetted Lead Source Companies Cons
  • Hidden fees can add up
  • Subscription sometimes required
Starting at $-$$

Quality leads are more likely to come from referrals or from a strong personal brand and online presence. It’s worth investing time and resources in building these areas of your business in order to attract high-quality leads.

Remember that while buying leads may provide a quick boost to your business, it’s important to focus on long-term strategies that will sustain your success over time. Building relationships, providing exceptional service, and becoming an expert in your local market will ultimately lead to a more successful and fulfilling career in real estate.

About the Author

Jim Gray got licensed in 2013 and sold 57 houses in his first year. Over the next 6 1/2 years he went on to sell 437 homes with a small team. He went on to manage the lead generation department of the 13th largest expansion team at Keller Williams and designed lead generation and conversion systems for 60 agents in 7 locations in 4 states that drove 600 home sales in a 2 year period. Jim currently does real estate team development and coaching for some of the largest real estate teams in the country.

Last Updated: 4/19/2024