- A homeowner becomes a motivated seller when they are willing to sell their property at a favorable price or with favorable terms.
- There are creative ways for investors to identify and market towards motivated sellers.
- The motivated seller strategy can also be applied in finding wholesale deals.
If you want be a successful real estate investor, there may be no more important skill-set than knowing how to find motivated sellers. In fact, if there’s one area that differentiates the struggling investor from the elite redeveloper, it may not be talent, money or personality, but rather a system for finding motivated sellers.
Without a source of motivated seller leads, you’ll waste valuable time trying to convince sellers that parting with their home is a good idea, rather than working with sellers who are passionate about moving forward on a deal.
The challenge many investors have is knowing how to find seller leads that turn into assets they can market to their real estate buyers list. And once you do find those real estate seller leads, how do you convert them into actual deals? (Not just contacts taking up room on your Rolodex.)
Because time is money—and speed is one of the most valuable assets an investor can have—here’s a blueprint for how to find motivated sellers in 28 days or less.
What Are Motivated Sellers?
A motivated seller is a someone who is eager to get rid of a property in their possession. Before we jump into the strategies for finding motivated sellers, let’s take a closer look at how a motivated seller differs from other types of sellers.
A motivated seller is a property owner who will meet at least one of the following conditions:
Willing to sell the property at a very favorable price: Usually this means 10-30% below market value.
Willing to sell the property at very favorable terms: This includes things like no money down, 0% interest, financing, etc.
Ideally, you want both conditions to apply, but at least one is generally required for someone to be defined as a motivated seller. Real estate leads come in many different forms. The big advantage you have when working with motivated sellers is one of speed. These folks have a compelling reason to sell that property, and understanding that reason (and helping resolve it) is what makes it “possible” to find motivated seller leads in 28 days or less.
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How To Find Motivated Sellers In 4 Steps
Find Your List: Use public records, internet research and networking to compile a list of property owners in the area.
Create Marketing Collateral: Strategize the best way to reach out to your list and draft sample messages.
Send Direct Mail: Launch a direct mail campaign (with scheduled follow ups) to your target group of property owners.
Filter Your Leads: Prepare questions for potential leads and begin pin pointing motivated sellers.
Find The List
As the old marketing expression goes, “The money is in the list.” And for investors wanting to boost their marketing to home sellers, it’s all about finding the right list of motivated home sellers and then sending them marketing pieces—usually in the form of direct mail—that encourages them to reach out to you or your team.
There are many different kinds of lists, but it’s usually a good idea to start with one or two and build out from there. Here are some different kinds of motivated seller lead lists you could acquire and market to:
Attorneys (Probate, divorce, estate, etc.)
People who own homes free-and-clear
Foreclosures (Both pre- and current)
Properties with liens
Homeowners in probate
Where do you purchase these targeted lists? There are many companies who specialize in this field, but some of the more common ones include: ListSource, and Z Buyer. Combine these with other segmentation filters, such as zip code or property size, and you’ll have a targeted list of potential seller leads in no time.
Create Your Marketing
Once you’ve got your targeted list created, it’s time to create your marketing collaterals. In most cases, this will take longer than seven days to fine-tune. For the purposes of this column, we’ll assume you have the bandwidth to generate three key marketing pieces in a single week. And these pieces include:
Your Direct Mail Piece: the postcard, letter, lumpy mail, or brochure you’re going to send would-be sellers
Your Website Squeeze Page: Where motivated sellers, who’d like to be contacted, will visit your page and share their contact info
Your Phone Lead-Acquisition System: This can be as simple as a Google Voicemail account or as complex as a customer service team
Of the three mentioned, your direct mail piece is the most important. You can always tweak your phone scripts or your website copy as you go, but no leads will materialize unless you get your direct mail pieces connecting with would-be sellers.
It’s a bit beyond the scope of this article to delve into precise direct mail marketing strategies. Just remember that, when in doubt, try to tap into primal emotions, such as greed, guilt or salvation when creating your pieces. Forget boring numbers or stats. Get an emotional response first, and then back it up with logic when trying to convince sellers.
Send Your Direct Mail Out (Wait For A Response)
Once you have compiled a list of motivated seller leads, spring into action and launch your initial direct mail campaign. This is actually the lightest week on your 28-day motivated seller lead calendar. Don’t worry, things are gonna ramp up in week four, but this week is where you physically send out your direct mail pieces and wait for a response.
Ordinarily it takes more than one direct mail piece to get a response from a lead. But for the sake of argument, we’ll assume your marketing message is compelling and that your list is targeted and highly-motivated. A good response rate for direct mail is about 4-5%; so if you send out 250 pieces, you can expect about 12 responses.
Note that highly personalized letters will have the best response rates. Think handwritten addressed on the envelope, or notes written on lined paper. When composing your message, appeal to the recipient’s issues and clearly state how you will solve a problem for them. Also be sure to invest in a “return service requested” service available with the post office. In case the homeowner moves you will be notified of the new address.
So, how do you send your pieces out?
Well, if you’re a “solo-preneur” with a tight budget, you might have to get your direct mail materials printed and fill envelopes—or mail postcards—yourself. This can be a way to go. But if you have the funds, using a company such as Modern Postcard or Printing for Less can be a great way to free you up to get ready for the next step. Which is…
Filter Those Leads
Once those motivated seller leads have started to call your toll-free number, or visited your website, it’s time to schedule a phone call in which you find out as much as you can about the seller and the property.
This includes things like:
Why they want to sell
How long they’ve lived there
How much they’re looking to receive from the sale
Where the property is located
Who’s on the title
What improvements have been made
Your job this week is not to “sell”; your job is to listen and gather information, as well as establish rapport. The more you can help educate a home seller about how the process works, and what they can expect along the way, the more they’ll remember and trust you.
Tips For Finding Motivated Sellers Now
Now that we have explored how to identify and market to motivated sellers, you may be wondering how to design a strategy for finding wholesaling deals. Wholesaling is made possible when an investor identifies an off-market property that can be purchased and then resold to a second investor or buyer, all at a discounted price. Wholesaling is a great investing strategy, but if it were easy, everyone would be doing it. The trick of the trade is knowing how to find and market towards motivated sellers. To get started, try practicing the following methods:
Look For Distressed Properties: Purchasing and reselling off-market properties at a discount is usually made possible because the homeowner is under some type of distress. One of the best ways to find distressed properties is to jump in your car and drive around your local market. Note that this activity is at no cost to you. Look for homes that seem to need some attention, whether it be untamed landscaping, boarded up windows, or perhaps appears abandoned. Once you find such a property, find the listed owner by visiting your local county records office or website and searching the address. Then, search for their contact information online.
Hop Onto Craigslist: Another effective (and free) strategy is to hunt for opportunities on Craigslist. Most investors may be unaware of how to find motivated sellers on Craigslist, but it all comes down to consistency. Investors need to regularly monitor the properties section for new deals, or deals that have been available for a long time. Lastly, don’t forget to update your notification settings so you get listing updates sent directly to your inbox.
Search For Properties On Zillow: Zillow gathers housing data straight from the MLS, making it a great place for up to date information on properties in the area. Surprisingly, it can also be a great place to search for motivated sellers. Learning how to find motivated sellers on Zillow is as simple as knowing what to look for. Keep an eye out for properties that have been on the market for a long time, or properties that have been re-listed. These could be a sign that a seller is ready to move forward with a quick transaction, so long as you take the property off their hands.
Find Owners On Facebook: If you have an allocated marketing budget, it may be worth learning how to find motivated sellers on Facebook. By utilizing Facebook ads you can reach a variety of users and draw in potential leads. This is a great way to send targeted marketing messages and automate your search. There are also free ways to utilize Facebook, which include starting a business page or joining real estate groups in your area.
You’ll notice we mentioned very little about “selling” during this 4-week process. Ironically, the more you’re able to segment your list of buyers, provide them with marketing materials that speak to them on an emotional level (and promise a way out of their situation) and talk to them in a conversational way, the more you’ll find the task of learning how to find motivated sellers far easier than you think. (And your only real challenge will be figuring out which seller leads to choose from.)
Do you have any special tips for finding motivated sellers? Perhaps you’ve developed an effective marketing strategy over time. Feel free to share in the comments below!
The post How To Find Motivated Sellers (In 28 Days Or Less) appeared first on FortuneBuilders.