Hi. I'm currently looking for deals for a builder client in San Mateo and Santa Clara counties (1 to 3m). This client can pay all cash, no contingencies, and will buy the property totally as is. Because they buy older houses on larger lots and build new homes that sell for more than twice as much they usually can offer market value. I've mostly been targeting absentee owners in these markets. I've compiled a list of 900 or so properties, skip traced them, and have been cold calling these owners. Something that keeps happening is people express an interest in selling, are interested in the offer I present, then when I submit the official contracts they ghost me. Others are very quick to assume I'm trying to either scam them, or if I send a text they think it isn't serious and its spam. My question is- is cold calling a good way to prospect for leads? It seems like doorknocking isn't such a good idea right now considering covid. Other things like developing a strong social media presence don't really appeal to me. Also I get that unsolicited calls are annoying but the level of rudeness I experience daily is always surprising. I keep questioning whether calling all of these people randomly all day is a waste of my time. What are your thoughts?
I don't think it is a waste of your time, especially if you are getting some traction. However, there seems to be something wrong if the property owners are interested in your offers and then don't respond when you actually send them. One way to combat this is to get the sellers on the phone and then send the offer while you have them on the phone and you can walk through the highlights and benefits of working with you. Also, consider how much you are qualifying them as sellers when you determine they are "interested?"
My question is- is cold calling a good way to prospect for leads?
If you can learn how to do it effectively, its the best. People ghosting you will happen no matter how you contact them.
However, if you can get them on the phone, you get an immediate response.
Most of the other ways (eMail, letter, text) are just throwing stuff over the wall and hoping for a reply.
@Mason Hickman Right. Qualifying them has been something I feel like I'm lacking on. Often times I get responses like "sure I'd sell, for the right price" or "make me an offer I can't refuse." Other times over the phone when I ask if they would consider my clients offer they ask "what is the offer?". At first I was quickly estimating what I thought it would be but this became problematic because sometimes I would be off and then the real offer would be lower. Now I've been going with "well I can get back to you within a day or so once I get their exact number". Then once I call them back after speaking with the buyer they don't answer. Or they answer in an annoyed way like "why are you calling me I don't actually want to sell I just wanted an offer". I guess a way to fix that would be to really study each area in the market more to be able to give more accurate estimates immediately which I'm working on but ultimately I think the problem is they aren't actually motivated to sell they just want an offer. Any ideas for how to qualify them during the initial conversation to see if they really are interested in selling? Another thing to consider is that most of these are absentee owners with primary residences nearby and the properties are in great rental markets so not alot of motivation. I'm going to start reaching out to probate leads soon.
Lately, I have been on the other end of these conversations as I am trying to market and sell a property from my late mother's estate in another state. I have received probably 20-25 solicitations since filing the probate proceeding from various investors. I guess mining the probate filings has become a "thing." As a real estate investor myself, I know how to determine a property's value, I know how to run comps, and I know that the investors contacting me in 99.999% of the cases have no interest in paying market value or even market value less commission. As a fiduciary for other heirs, I need to market the property broadly to avoid any potential legal issues.
Based on this experience, my sense is that you need to make certain your contacts are aware of the fact that you are not in the business of low-balling unsuspecting or distracted or uninformed homeowners. It might help if you presented comps with your offers if, in fact, your client is ready and willing to pay market or real close to market.
@Darius Ogloza Yes. I'm very familiar with low ball cash offers. I started off wholesaling to flippers that wanted ridiculously low prices. This builder client can absolutely pay market value in most cases. Maybe when I open the call with "would you consider a cash offer for your property?" I sound like every other so and so buys houses. Will definitely try to quickly relay that the offer will be market value.
If someone called me out of the blue and wanted to make an offer, of course I want to hear the offer; why wouldn’t I? If they offer far above what I think it is worth, I can do something with it. If it’s a low-ball, I dodge their calls. I would try to qualify if the owners have considered selling or may be Interested in selling before even making an offer or bringing it up; this will likely weed out the false positives and save you time from writing offers that will never go anywhere. If an owner says something like “no, I have no desire in selling and plan to die in this house”, are you still trying to give them an offer?
I'd say your doing the right thing, each No is closer to a yes. Keep in mind that the "quality is in the quantity". As far as them being rude that's normal don't let it destroy your energy. I agree with @Mason Hickman 's approach by going over the agreement with them on the phone " it's company policy, that way we are on the same page and I can answer any question you may have" .
@Account Closed As someone who as done a tone of cold calls. Say 10k plus.... It's difficult. You're call falls under a stigma to basically everyone you contact. Some will have had a bad day and feel justified in venting it on you because of the premise of the call and said stigma. No way around that. Hone your pitch. If it sounds like a pitch, people will feel it to not be sincere. Your pitch should allow for conversation flow and mostly help you stay on point. Sales is a profession, a craft. Hone that craft. Also, study the market to give the best numbers. Now, the best is relative. The best for you is to low ball and be honest you're doing so. Because you're new to the market in that area. And that you've been wrong before and the property is worth more. So we are just speculating numbers at the time. Sales is emotional, and you need to create excitement without creating unrealistic expectations. If the customer is emotionally engaged it helps a lot. But, with great power comes great responsibility. That's the part where craft takes place. Visit local places, eat there, listen to the people. If you can sound local then you can break a barrier cold calling has. But that's just my 2¢
Account Closed watch the movie Boiler Room.
I don't mind if people call me as long as they are respectful and offer some value to me. If they are reading a script or saying nonsense like "I will pay you top dollar for your property", I get annoyed. Nobody is cold calling me to pay MLS prices for my property, so cut the BS.
Peoples time is valuable, so respect them. Tell them how you can help them and if it isn't a good fit, get off the call. People will sometimes agree to things just to be polite. They may also agree to something, then have someone advise them against it later. If someone ghosts you, it is because they don't know how to say no.
Cold calling is completely a numbers game. The people who are being rude are just sick of the constant calls and texts. If you are going to be successful cold calling people, you need to not let it get to you. Every no is one step closer to a yes. Read sales books like Sell or Be Sold, that is a good one to help with sales mindset.
@Account Closed I cold call for a living so its definitely not a waste of time. In my experience nearly nothing happens on the first call. The money is in the follow up.