Where Secret Real Estate Millionaires Get Real Estate Investment Leads

There are many ways to make money through real estate. You may become employed as an agent. You may work in the field as a teacher. You may decide to buy and sell your own home. 

But the people that bring in the most dough are the investors. They are the house flippers, the landlords, and the developers. 

You may wonder, where do secret real estate millionaires get real estate? And how do they find buyers and sellers? This article will explain the process, so you know what’s involved. 

Quick Rundown of What Lead Generation Means in Real Estate

When we think of real estate lead generation, we typically think about the strategies realtors use to find buyers and sellers. Here are a few that are commonly integrated:

• Mailings and postcards
• Door knocking
• Social media
• Phone calls
• Real estate lead generation companies
• Events
• Flyers
• Videos
• Blogs
• Websites
• Emails

A real estate investor will use several of these strategies, but they will take a different approach. 

Why Lead Generation is Different for Real Estate Investors

Real estate agents are generally looking for people that want to buy and sell houses. In some cases, they may represent someone looking to buy or sell a commercial property. 

Their main goal for buyers is to get them a home that suits their needs and will be a good investment. Their main goal for sellers is to help them sell their homes quickly and generate optimal profit. 

An investor will look for a property they can make money from. They will typically make some renovations. Then they will find buyers that will buy at a profit. 

In some instances, they may look for renters that will rent out their properties to help them generate income. 

Buyer Leads vs. Seller Leads

A real estate investor needs both buyer and seller leads. Their seller leads will help them find properties. They will often look for properties that have ‘fixer-up’ potential. This will allow them to make renovations and turn a profit. 

Investors must consider several factors to ensure they make money off the properties they buy. They must figure out the cost of their repairs, property taxes, and other expenses to ensure they turn a profit.

It’s also wise to buy in an up-and-coming location. After all, you can always fix up the house, but you can’t fix up the neighborhood. 

Buyer leads are meant to attract buyers. There are various types of buyers you may cater to. You will be targeting home buyers if you are house-flipping. You will target renters or condo owners if you invest in multi-family properties. Or you may choose to sell to another investor. 

Your strategies will vary depending on the type of buyer you are targeting. 

Our #1 Personal Favorite Tactic

There are a wide variety of tactics to choose from when considering both buyer and seller leads. But our number one favorite is to drive around. 

Driving around has a very organic feel. You can see homes up close, so you have a good idea of what you’re getting into. 

Once you find a home that looks good, try knocking on the door. The owner may just let you in to look around. 

If no one is home, you can get the agent’s number off the For Sale sign and call later. Or look up the address for more information. 

Seek out homes with fixer-up potential. The wheels will start turning when you think of the improvements you can make to turn a profit. 

Our star agent, Chris Heller, shares a story about his driving-around adventures.

“I was driving around, and I found this house that looked perfect. It was in a great neighborhood, and with a bit of TLC, I knew I could fix it up and make some money.

I knocked on the homeowner’s door and they were home. They let me in to look around. Long story short, we sealed the deal later that night. 

Never underestimate driving around. It’s a very powerful strategy.” 

Other Tactics Used by Top Real Estate Agents

Driving around is exciting and effective. But there are other ways to get buyer and seller leads. Here are a few to consider. 

Hire A Real Estate Agent

A real estate agent that’s familiar with the area you are shopping in will find out about open properties early on and bring them to you for consideration. You can start an ongoing relationship with an agent so they keep you abreast of the latest developments. They can provide you with contacts, connections, and insight that will help you make wise investments. 

You will have to split your profits with an agent, but it’s well worth the investment. 

Use the MLS

The Multiple Listing Service offers a database of properties available in your area. Many people have access to the MLS, so if you find an attractive listing, it’s crucial to jump on it right away.

It helps to be preapproved for a loan before you start shopping. It shows you are serious and that you have the funds to make the deal go through. It will increase the chances of your offer being accepted. 

MLS membership is only available to real estate agents and brokers. But the agent you work with can get you access. They will also answer your questions and represent you if you decide you want to pursue a property. 

Online Auctions

Homes can go into auction for a variety of reasons, but the most common are foreclosures and tax liens. Auctions are a good way to buy a home because they help you buy cheaply. Bidding typically starts at the amount of the delinquent property taxes plus penalties and fees. 

In the past, home auctions took place on court steps. But today, they are conducted online. Digital formats are a more convenient way to shop. 

You must have enough cash on hand to buy a home in an auction. But you can also arrange for delayed financing and take your cash out of the projects you’ve invested in and put it towards the new property. 

Network

You never know when someone will have a lead on a property that will make a great investment. Talk to various people to let them know you are in the market. Ask friends, family, and colleagues if they have heard of homes on the market or if they know of anyone moving due to a job change, downsizing, or divorce. 

Keep in mind that some of these people may be dealing with sensitive situations. Approach them tactfully.  

Networking is a good strategy because it’s inexpensive. It also keeps you in touch with professionals that may present other types of opportunities. 

Check Out For Sale by Owner Properties

Owners that decide to sell their properties may become frustrated by the process. They may be relieved when someone walks to their door and offers to take the property off their hands for cash. 

You can find FSBOs by driving around your neighborhood. If you see an FSBO sign in the yard, knock on the door. Or take their number down and call later.  

Craigs List is also a great resource for finding FSBOs. 

FSBOs are a good investment option because sellers don’t need to pay real estate agent commissions. They usually sell for cheaper so you can make more of a profit. 

Look for Pre-foreclosures and Foreclosures 

Several websites will tell you which homes are under pre-foreclosure and foreclosure. An owner in pre-foreclosure will be motivated to sell to prevent foreclosure. They are likely to sell at rock-bottom prices. 

Foreclosure properties may be purchased at an auction. 

Look Into Short Sales

A short sale is a pre-foreclosure transaction that involves the mortgage lender allowing the homeowner to sell their home for less than, or short of, the outstanding balance. The homes are typically affordably priced allowing investors to make money. 

One downside of a short sale is, contrary to their name, they tend to drag out for a long time. They are not the best option for investors looking to turn a profit quickly. 

Skip Tracing

Skip tracing is similar to a process you would use to find old friends and acquaintances online, but it’s more sophisticated. It provides you with contact information on real estate investors, agents, agencies, and more. 

The strategy is effective for investors looking for sellers. It identifies distressed properties with motivated sellers. It prevents you from calling bad leads. It assists in cleaning bad data. It helps you find previous leads you contacted so you can follow up. 

Several online sites offer skip-tracing services. Determine which is best suited to your needs. 

Buyer Leads

There are several ways to find buyer leads. Your approach will vary depending on who you are selling to. Here are some examples. 

Homebuyers/Renters

Investors will be targeting homebuyers if they are flipping houses. They will be targeting renters if they are investing in multi-family properties and vacation homes. Similar strategies can be used in both instances. 

Their tactics will be similar to the methods a real estate agent would use to sell homes. They may consider hiring an agent for these purposes. 

Here are some suggestions: 

For Sale/Rent Sign

A for sale or rent sign is one of the simplest, oldest, and most effective ways to catch buyer interest. 

Website

Investors can make an attractive real estate lead generation website that features their listings. An SEO-optimized website will bring in a lot of traffic increasing your reach. 

MLS

List your property on the MLS to increase buyer and renter interest. Your agent can help you with this task. 

Other Listing Websites

The MLS is considered a bible for agents, owners, renters, investors, and buyers. But other sites host real estate listings. Zillow, Realtor, Craigs List, and Trulia are just a few worth mentioning. 

Social Media

Social media platforms are ideal for sharing listings. They have a wide reach, and posting is free. You may consider doing paid social media advertising to reach more targeted audiences. It is inexpensive and yields a considerable return. 

Direct Mail

Direct mail is a good source for generating interest in your properties. It’s generally low cost and it helps you stand out from the pack in this age of digital advertising. It is a preferred marketing method of Gen Z-ers.

Display Advertising

Display advertising usually takes the form of banner ads that appear on websites. But they can also be found in emails apps, and more. They can utilize a wide range of media including text, images, audio, and video to make them more interactive. 

Create a Strong Listing

Lead generation for buyers won’t be nearly as effective without a strong listing. Every buyer strategy included here will either feature your listing or compel buyers to check out your listing. It’s important to create one that stands out. 

A strong listing will discuss the finer points of your property. It will be descriptive and detailed. It will make the listing attractive without exaggerating. 

Investor Leads

You may also consider selling your property to another investor. Investors will be interested in purchasing properties that generate income. 

Your buyer-lead strategies may get an investor’s attention. But here are some methods that offer a more targeted approach. 

Join a Real Estate Investment Club

Real estate investment clubs are designed to help you connect with other investors. They are usually used to find investors that you can partner with on investments. But you can also use them to get the word out about a property you want to sell. 

It’s ideal to find an investment group with like-minded investors. You will also have to pay club fees. But you will gain access to opportunities that make them a worthwhile investment. 

Target Your Network

There may be people in your network interested in buying your property. Hit up family, friends, colleagues, and people in your community to get the word out.  Your real estate agent may also know interested investors. 

Online Resources

There are online investment groups and communities like Meetup and Bigger Pockets that may connect you with investors. Make sure to use a reputable website and investigate the right opportunities. Avoid getting scammed or trapped in a shady deal. 

Social Media

Social media will help you get the word out about a property you want to sell. But if you are looking for investors, you need a more targeted approach. 

There are several Facebook and LinkedIn groups for real estate investors. Joining those groups will get you the connections you need when you are looking to partner with someone or sell properties. 

Other Tips for Investors

Here are some other tips that will help you be successful in real estate investing. 

Avoid Hot Markets

Many investors target markets with properties that have recently gained value. But often, those markets have nowhere to go but down. 

When a market is hot, it attracts contractors, investors, and new businesses that build new properties in the area. New properties increase supply which eventually reduces demand. 

Shop for properties in areas with low crime rates, good schools, and walkability. Stay away from neighborhoods that become too trendy. 

Consider Your Costs

‘Buy low, sell high’ is a common investor strategy. But you must consider your expenses including the purchase price and renovations. Make sure you are in a situation where you will make your money back. 

Tap Into Hidden Markets

Foreclosure auctions will allow you to bid on inexpensive properties. But most of these homes will be in advanced states of disrepair. 

It’s a better strategy to look for homes that haven’t been put on the market yet such as ones owned by couples going through a divorce or properties of recently deceased individuals. These are likely to be well-maintained. And with buyers desperate to sell, you will probably get a good price. 

Understand the Market

It’s advisable to buy a property in a market you are familiar with. Doing so will let you know how much you can charge when you are selling or renting. 

It will also get you familiar with what amenities buyers in the community are looking for. For example, if you are investing in a property in a family-friendly community, don’t rip out the bedrooms. Don’t put a pool in the yard if there’s not a lot of demand for it. 

You must also keep inflation in mind. Some home prices rise, but they are more affordable when you consider inflation. 

Manage Your Risk

You can manage your risk by not accruing excess debt. Aim to put down a 10-20% down payment to avoid high-interest rates. 

You should also maintain a large cash reserve. This will allow you to carry the property for some time without needing to sell quickly. It will also give you money to spend on repairs and other expenses.  

Final Words

Leads are just as important for investors as they are for agents. Driving around and other tactics will help you find buyers and sellers that will earn you a steady cash flow. We wish you luck in your endeavors.