Top Strategies for Finding Motivated Seller Leads
Strategies for Finding Motivated Seller Leads
If you’ve been a real estate investor for any time at all, then you know that the name of the game is Finding Motivated Seller Leads.
You are dead in the water if you can’t generate a motivated seller lead.
Sure, you could have some discounted deals brought to you by wholesalers, but you will be severely limited if you are not talking directly with sellers.
So the million-dollar question is, “How do I generate consistent motivated seller leads?” This question is what keeps real estate investors lining up for seminars and coaching programs.
There are countless marketing strategies to choose from, but which are the best? The truth is that they all have different pros and cons, and each tactic has a varying success rate that depends on your local market.
In this article, we’ve broken down the most popular marketing strategies that successful real estate investors use today to find motivated seller leads. That way, you can find the ones that work best for you.
If you commit to using these strategies, implement the tips we give, and adapt until you find what works best in your market, your real estate investing career will take off in no time!
Let’s dive in!
What is a Motivated Seller?
A motivated seller is someone that needs to sell their house and is willing to sell at a discount or with favorable terms to get it off their hands. Without some level of motivation, it will be tough for you as a real estate investor to structure a deal that will be profitable for you.
A seller’s motivation is not binary, or black and white. Motivated sellers come on a spectrum, from not motivated at all to “please come take my house for what I owe on it!”
Wouldn’t you agree that it would be much easier to structure a good deal with the latter? The good news is that these sellers are out there, but they typically aren’t waving a flag for you to see them. It is your job as an investor to run a marketing campaign to find these quality leads and then have conversations with them to gauge their motivation and offer a solution.
Most Common Reasons for Property Owners to Be Motivated to Sell
Pretty much every factor that could motivate a homeowner to sell their house at a discount falls under one of two categories: a distressed house or life and financial distress.
A distressed house is pretty apparent. The exterior is unkept, and the inside needs significant repairs or updates.
Life and financial stress take a little more digging to find. However, these motivators are often stronger than a house in disrepair. Some of the best deals you will ever structure will be when you can use your expertise to solve people’s life problems by buying their houses.
Here are some common themes among motivated seller leads:
- Vacant Property – House is sitting empty and getting worse over time
- Accidental Landlord – Wanted to sell their house but were forced to rent it out after it didn’t sell
- House in Disrepair – Property has significant issues that make it difficult to sell
- Moving for Job – Needs to sell quickly to avoid carrying an extra payment
- Foreclosure – Behind on payments and needs to sell before the house goes to auction
- Health Issues – Poor health makes it challenging to keep up with the property
Outbound vs. Inbound Marketing
When marketing to find motivated seller leads, it is important to understand the difference between outbound and inbound campaigns.
An outbound marketing campaign involves directly reaching out to sellers to let them know you are interested in buying their houses. This may be through direct mail, cold calling, or text message. The point here is that you are making the first contact and targeting specific homeowners.
Instead of you contacting sellers, inbound marketing involves motivated seller leads coming to you. Some of the most common types of inbound marketing include SEO, Google ads, and Facebook ads.
The dynamic between you and the seller can drastically differ between these two types of lead generation. With outbound marketing, many homeowners will wonder why you are contacting them, and some will not be happy about it! However, inbound leads are at least somewhat interested in selling their houses, so the start of the conversation is typically much warmer.
However, each marketing campaign has its place and can give you success. So let’s dive into the specific strategies!
Outbound Marketing Strategies
Outbound marketing strategies are generally the quickest way to get started and begin generating motivated seller leads. Here are the most common methods.
Direct mail is a tried and true method for lead generation. And this marketing strategy transcends real estate. All types of companies use this tactic to attract new clients and customers.
However, while most businesses choose to canvas an entire area with direct mail, real estate investors try to be more targeted with their outreach. Instead of sending mail to every house in an area, you can filter your list based on specific criteria that will increase your likelihood of finding motivated sellers.
Most real estate investors choose to send either postcards or letters. Both of them can work, but one might fit your situation better than the other.
Postcards are great because they have the chance to hit the recipient at the mailbox. People are so bombarded with information and junk mail these days that they often sort their mail over the trash. A postcard can grab their attention before they move on to something else. Also, postcards are usually cheaper than letters, so they are better for large lists.
Letters can be more personalized than postcards, so they can sometimes help you to stand out from other investors. A letter that appears to be handwritten will often grab the recipient’s attention because it looks like it was sent specifically to them and no one else.
A major key to success with direct mail is consistency. Many rookie investors get excited about generating leads, send out a batch of postcards, and become disappointed when they don’t get any deals. The investors raking in deals from direct mail know that most people won’t respond until you’ve contacted them several times. However, once you get the machine moving, this can be a great way to find motivated sellers.
Cold calling is many real estate investors’ favorite way of finding motivated seller leads. Instead of waiting on them to contact you, cold calling involves getting them on the phone right away.
You would be surprised how many people will be willing to sell their homes if you just get on the phone with them. Most of them are just too overwhelmed to even think about it and end up putting it off. However, with the right nudge, they might be open to a cash offer.
One key to success when cold calling is having a friendly personality. People are getting more spam calls today than ever, and you must differentiate yourself from all the other calls they are getting. Remember, you are catching them off-guard, so your top priority is to catch their attention and let them know why you are calling.
If you are serious about cold calling, you will need a robust CRM. Otherwise, it will be impossible to keep track of all of your contacts. Not only can a CRM consolidate your contacts, but it also allows you to set automations that follow up with your prospects on a defined schedule.
Lastly, you will need an accurate skip tracing service. Without accurate phone numbers, most of your cold calling effort will be in vain.
Perhaps you like the idea of grabbing people’s attention through their phones, but you either don’t have time to call them all or don’t feel comfortable talking to cold leads. Text message campaigns might be for you!
Instead of personally calling motivated seller leads one by one, a real estate CRM will allow you to send a batch of text messages with one click. Not only that, but it will enable you to schedule a series of messages at preset intervals. After all, most people will not respond to the first message you send them. Like direct mail, text messaging typically takes multiple follow-ups to get a response.
One of the perks of text messaging is that it allows you to screen out all of the dead leads and only get on the phone with truly motivated seller leads. It can take quite some time to sift through all of the contacts via cold calling, but text messaging makes this much simpler.
Pro Tip: Hire a Virtual Assistant
Properly managing cold calling and text message campaigns can literally be a full-time job. Without ample time to keep everything organized, it can quickly become overwhelming.
Not only that, but these strategies are a numbers game. You must be contacting a significant number of homeowners in order to find motivated sellers. If you don’t have the time to be consistent with it, you will likely be disappointed with the results.
If this is your situation, you should consider hiring a virtual assistant. Many companies specialize in real estate lead generation and train their VAs to talk to motivated sellers. Think about it. What if you could have someone else pounding the phone while you are working on other tasks for your business? Beyond that, most virtual assistants are highly affordable.
To be successful when hiring a VA, you should avoid putting too much responsibility on them. Many investors make the mistake of relying on their virtual assistants to have detailed conversations with motivated seller leads. While some can do this, most don’t fully understand the intricacies of real estate.
Wouldn’t you agree that relationships with motivated sellers are one of the most critical parts of your business? Then why would you delegate the most delicate part of your business to someone else?
In general, the best way to utilize a virtual assistant is to have them crunch through extensive lists of leads and sort out the ones that show signs of motivation. That way, you can focus your effort on those and build credibility with them.
How To Generate Lists for Outbound Marketing
Your success with outbound marketing campaigns will rely heavily on the lists you use. Sure, if you contact enough people in an area, you’re bound to find motivated sellers.
But you want to supercharge your conversion rate, right?
It all comes down to pulling lists with a high probability of motivation and using an accurate skip tracing service to get phone numbers.
Real Estate Software
One of the best ways to generate lists of motivated sellers is using a real estate investing software such as PropStream. It has many valuable functions for real estate investors, but where it really shines is its ability to create filtered lists of potentially motivated sellers.
Simply enter an area you want to target and then apply criteria to filter your list. This criteria could be property values, equity percentage, or pain points. Here are some pain points that you could start with to begin finding motivated seller leads.
- Vacant Properties
- Absentee Owners
- Out-of-State Owners
- Low Equity
- Expired Listings
- Tax Delinquencies
- Senior Owners
These are just a few ideas to help you get started. Once you generate a sizable list, you can either send them mail or skip trace them and start reaching out to them via phone.
The ease of pulling lists from a real estate investing software is a blessing and a curse. It’s nice because it’s super simple, but the problem is that everyone else is doing it. Unless you’re targeting an area with low competition, you must get creative with your pain points to avoid hitting the same property owners as everyone else.
One easy way to do this is to work with a list broker that specializes in motivated seller data. These services use data beyond what you can find in most real estate software and allow you to pull a very specialized list. Here are some of the motivators that they offer:
- Low Income
- Low Credit Score
- Pre-NOD (Notice of Default) – 30, 60, 90-Day Mortgage Lates
- Code Violations
By targeting these niche lists, you can get a leg up on the competition by contacting homeowners that are not on your competition’s radar.
Driving for Dollars
While generating lists of potentially motivated sellers through digital means is great, they are not perfect. Sometimes the data is inaccurate or out of date.
However, what can’t be out of date is the actual condition of a house. If you put eyes on a property and can tell it has been neglected, the chances are high that the owner is distressed and needs to sell it.
You can begin driving for dollars by picking out areas you want to invest in and driving through them on the lookout for distressed properties. But don’t just pick any area. If you drive through the nicest neighborhoods in your city, you likely won’t find any leads.
Before you get started, use a real estate investing software like REsimpli to plot all of the vacant properties in your area. By looking at that map, you will begin to notice pockets of these properties, and these are the areas you should focus on driving through.
The great thing about driving for dollars is that it allows you to get ahead of the competition. In the summertime, a home’s yard can become overgrown after only a couple of weeks of neglect. There’s no way someone pulling lists could detect a sign of distress that quickly.
Inbound Marketing Strategies
By definition, outbound marketing involves reaching out directly to property owners to determine if they’re motivated to sell. There is no doubt that this type of marketing works.
However, what if instead of chasing down sellers and asking them if they want to sell their homes, the ones that were ready came to you? That is the goal of inbound marketing.
In general, inbound motivated seller leads are of much higher quality than those from outbound campaigns because the inbound leads made an effort to contact you first.
The secret to inbound marketing is being in the places where motivated sellers are looking. Here are the best strategies to get in front of the right people and have them ask you for a cash offer on their homes.
SEO (Search Engine Optimization)
Here’s a question for you. When you need information on something, where do you go? Probably Google or Youtube, right?
Don’t you think you would get motivated seller leads if your website was one of the first results when someone searched for “sell my house [your city]” on Google? There’s no doubt about it! You would get high-quality leads in your pipeline on a regular basis.
For real estate investors, that is what SEO is all about. The goal is to rank for every keyword that a motivated seller might search for.
So how do you do this?
The first step is to have a stellar website with a great user experience. After all, what’s the point of driving traffic to your website if they’re not impressed and end up bouncing from your site to one of your competitors?
The first step in providing a great user experience is putting yourself in the shoes of a motivated seller. You must think about how they are feeling and the questions they have. If you can ensure them that you understand their situation and answer their questions, you will likely resonate with them and convert them into a lead.
After building a highly credible website, the next step in SEO is to build backlinks from other websites. A backlink is when another website links to one of your pages within its content. This shows Google that other site owners find your content useful and is a huge ranking signal. The more backlinks you build, the higher your site will climb.
The tough part about SEO is that it takes time. In a competitive market, it can take several months or even a year to climb the rankings to a point where you get your first motivated seller lead.
So do you just have to be patient and wait that long?
Absolutely not. You can supercharge your effort with Google Ads.
While the organic rankings are affected solely by SEO, you can pay to have your website show up in the ad space (the first four spots at the top).
PPC (Pay Per Click) is the best way to generate inbound seller leads while putting in the work and waiting for your site to rank organically. While you don’t need backlinks to run Google Ads, you do need to have a website that converts traffic into leads. Once again, just because you get people to your site doesn’t mean anything unless they request an offer from you.
Another great way to generate inbound seller leads is through Facebook ads. Instead of waiting for motivated sellers to go to Google and search for you, you grab their attention while they’re scrolling through Facebook.
Leads from Facebook typically aren’t quite as hot as SEO leads, but there are generally many more of them. It is a quantity vs. quality thing. However, this doesn’t mean that none of them are highly motivated seller leads. It just means you need to sift through them a little more.
If you are interested in running Facebook ads to generate real estate leads, it is vital to work with an ad agency that specifically works with investors. They know how to work the algorithms to get in front of the right property owners, and they know what types of ads convert and which don’t.
It’s Time to Start Generating Motivated Seller Leads!
If you’re looking for a marketing strategy that will help you to start generating more seller leads, this is a great list to begin with. We recommend picking some that seem like a good fit for you and trying them out.
Remember to stay flexible as you work through marketing methods, because what works in one market can flop in another. The most successful investors have iterated dozens or even hundreds of times until they found a plan that works for them. However, a full pipeline of stellar deals is well worth the effort.
The key is to take action and measure your results. Before you know it, you will converge on a strategy that works for you.
We wish you the best on your investing journey!