Paying for leads Yes or NO?

Question

Hello Friends,

My wife and I are pretty new to the business ( about 4 years) and we are part of a larger team that has done fairly well.  In the recent months its seems like all our lead generation has dried up.  We do all the normal stuff like letters to FSBO, Exp, Probate, Divorce, absentee owners, and we do social events, volunteer and direct marketing to clubs and groups. In the past 3 months we have got nothing in return.  We are tossing around a few idea about paying for leads and the million dollar question is which company have any of you fallen in love with.  I'm looking for a business that does better than .5% closure.  So let me know what you all think any new pointers are welcome too.

Oscar Pinto · Answer

We ALL pay for leads, in either time and/or money. You decide what you want to spend. Cold calling expired is cheap and labor intensive. Sending out mailers is costly but effective.

i think you're asking"should I pay for a lead so urce company?" My suggestion is YES! And if works run with it. If it doesn't then cancel. Test and test

Maria McCreless · Answer

@Joseph Beilke and @Brad Miller

I have purchased leads from Zillow and Realtor.com.  I have purchased them in multiple zip codes and some zip codes have yielded great conversations while others I haven't sold a single house in.  The zip codes that have worked out best for me are actually the cheapest ones to purchase.  They tend to be a little more of a drive but have been a huge success.  The ones I have tried that are higher end zip codes have produced very little leads and no conversations.  I had way more success with Realtor.com than Zillow.

I like the fact that realtor.com texts and emails you when a lead comes in vs. Zillow that calls you.  This allows me to get in front of the computer, pull up MLS and have more information on the property than getting a random call.  Realtor.com reimbursed me for those zip codes that didn't produce the leads that they promised.  In my area, there are some big teams that sell tons of real estate - one broker has all of his agents on salaries, so all sales go to him.  So if you're the buyer and you see a home you like on Zillow and you want more information, do you click on the picture of the agent who has sold 460 homes this year or the 30 homes? I am sure if you have huge advertising budgets than zillow might work for you, but again it didn't for me.  Not trying to encourage you guys one way or the other, just my experience.

I do not get listings from my leads only buyers.  In the last two years, I may have received one seller lead, but I chose not to follow up on the lead.

All in all, its been WELL worth it for me. I do believe its trial and error, you have to try several zip codes and see what happens and be prepared to move zip codes and let them know that they are producing leads or conversations.   Many buyers are not preapproved, but I have had great success getting them over to my lender and then approved.  My rule of thump is to show a lead one house, get to know them, and then get them preapproved.  When talking to online leads, I only screen by asking them if they are working with another agent and wait to discuss preapproval when I meet them.  I know that most people agents do not work this way, but in terms of online leads its worked really well for me.

Let me know if you guys have more questions and I would be happy to answer them.

Brian H. · Answer

Hey Joseph and Brad... I actually work with/for a company specifically for this problem. A lot of people in RE have problems like this (don't even get me started on the company that rhymes with "pillow").

Anyways, I don't want to pitch you anything, but to make a long story short - the marketplace has become very crowded and a lot of people are jaded in the industry. Being investors ourselves we noticed this awhile ago and created a system to actually get around all the headaches and we're getting actually qualified leads (exclusive). These aren't all foolproof of course, but basically the people that go through life events and become distressed sellers actually reach out to you and only - being the main difference.

Again, I need to play within the guidelines on here and I also like to genuinely help on here so if you'd want to at least learn a little more let me know!

Brad Miller · Answer

I'm new to the business and I've signed up for and talked to just about all the lead gen companies you can think of.  Everyone seems to have the same sales pitch and "guarantees" but at the end of the day very few if any are pre-qual leads and/or 90% are renters.

I'm following this thread in case there are some options out there as I would like to invest in a company that could offer legit leads but companies that don't rhyme with "pillow".  :/