Is it best to buy leads or prospecting phone #’s as a new agent?

Question

As a brand new agent starting out with a small network. Is it best to buy leads or pay for a program that give you access to phone numbers in your area for prospecting? Or should I just wait it out and work with the network I have?

Nathan Gesner · Answer

Hell to the naw!

I'm in a small market so it's easy to see/track. I have a few local agents that pay for leads through Zillow or other sites. I don't compete against them and I count them as friends, so they're pretty open with me. Do they make money on those leads? Yes. Is it worth it? Not when you calculate the actual amount of time spent.

For example, one of them gets an average of nine leads a week or 468 a year. The overwhelming majority are lookers that never turn into buyers or sellers. If he spends just 15 minutes on each lead, that's a total of 117 hours. He converts about 1% of them. With an average sales price of $200,000 and a 2% commission, that comes out to $20,000 in commission or $170 per hour. Not bad, but not stellar.

He could use that same 117 hours to nurture existing relationships and get a much better return for his time without spending any money. That's what you should focus on: nurturing existing relationships and asking for referrals.

Ketlie Jean · Answer

@Melissa Nunez

It’s always better to start working with buyers in the beginning . Host some open houses for agents who have a lot of listing , don’t have time , follow up with those potential buyers, specially with those who are not working with agent yet . Hope that can help

Good Luck !

Melissa Nunez · Answer

@Jay Berube

Thanks so much Jay! I really appreciate your advice!

Jay Berube · Answer

Hi, Melissa! I have a lot of experience with prospecting phone numbers, having done this for 15 years. Speaking from experience, I have to say that this is extremely difficult to do. It takes time to get good, it's a saturated market, and there is a lot of rejection. But if you want to try it, let me know and I will get you the best links for the best resources. About buying leads: I would not do that either. Most of the people you are buying leads from have a lot of competition. Plus, it's expensive. If I were you I would focus on other strategies. First of all, you should build up your database, gathering everyone who is in your sphere. Then set up a strategy that can be as simple as a monthly call, a monthly email, and a monthly postcard. This way you can reach out to people 36 times a year and get business that way. I would also consider working for a team. You have to pay them 30% of your gross commission income but they could supply you with leads and give you good structure.

Best of luck!

Charlie MacPherson · Answer

@Melissa Nunez I echo what @Nathan G. says. Most ZTR (Zillow, Trulia, Realtor.com) programs cost a fortune and send each lead to up to 4 agents at the same time. Your response time has to be seconds, not minutes. Otherwise you'll be the 3rd agent blowing their phone up. Guess how that's going to play out.

One that I'd recommend is OpCity. That's a Realtor.com program where they generate the leads and send them to you (and every other agent who has signed up in your area). No cost up front, but you pay them 30% - 38% at closing.

Leads go to the first agent to respond, so again, seconds not minutes.

The good thing is that they eat all the leadgen costs. You invest nothing - but that commission is a big bite. Still, it's a better deal than spending thousands on so-called "leads" that did nothing more than hit a "more info" button while they were sitting on the toilet flipping through listings.

If you have the stomach for it (and I didn't), you can try AllTheLeads.com. They'll send you probate leads several weeks after someone passes away. You get the personal representative's contact info. I just couldn't be the person who called and said "Sorry your Mom died. Want to sell her house?" The only thing worse than an ambulance chaser is a hearse chaser.

Personally, I'd rather go broke than make those calls, but some can do it successfully. It's a lead source that many won't work with.

I think it's best to focus on building your network. Be sure that every person in your sphere of influence knows you sell real estate and stay in touch with them all.

Good luck!

Melissa Nunez · Answer

@Nathan G.

Thank you so much! I really appreciate your insight as I’m navigating this new process. I was definitely wary about paying for leads on Zillow and other site like it. Again thanks for taking the time to answer me!

Melissa Nunez · Answer

@Abel Curiel

Thank you so much Abel I’m definitely working on using my social media and have recently joined a team so I’m excited for what’s to come!

Abel Curiel · Answer

Hello @Melissa Nunez,

You've received some amazing advice on this thread from @Nathan G. @Spence Kal @Charlie MacPherson @Ketlie Jean @Jay Berube!

Contacting your sphere, joining a team, hosting OH's for other agents, and lead sources with no upfront costs are great options.

I'd also recommend working on your social media profiles and networking virtually with other RE professionals. Lenders especially! Loan officers typically have budgets set aside for investing in agents' lead campaigns. Develop a strong online presence in your area by tagging locations, using hashtags, and posting frequently. Potential customers can find you and Mortgage Pros will certainly find you.

If you can focus on your sphere, build your social media presence, call FSBO leads (zillow, facebook, craigslist, trulia, realtor.com), and have lenders funnel warm/hot leads your way, you should have enough lead sources to get you through the first few months in the business.

SEO, google and yelp are long-term plays but its never too soon to start working on those lead sources.

Lastly, I know a cool site called BiggerPockets.com that can provide leads with a Premium membership!

Best of luck to you moving forward!

Abel

Spence Kal · Answer

@Ketlie Jean is right, I've heard most agents have a lot of success with open houses for agents. Followup is CRITICAL and something most agents don't do. If you can follow up with someone, once a mont/year/whatever it'll put you ahead. Ill send you a pm about content marketing and what I'm working on, I just started myself so don't have a lot of data to back it up yet, but I'm following what others have done successfully and really enjoy it

Melissa Nunez · Answer

@Ketlie Jean

Thank you Ketlie, I heard that suggestion a lot when I was in school. It is a bit more difficult to network with different agents due to covid but I may just have to try harder than I have been! Really appreciate your response!

Is it best to buy leads or prospecting phone #’s as a new agent?

Is it best to buy leads or prospecting phone #’s as a new agent?

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