Learning how to source property deals to grow your own portfolio or sell to other investors is a very important skill to know.
Whether you’re just starting out on your property investment journey, you’re a seasoned investor looking to grow your portfolio or you’re a deal packager looking to offer more deals to more investors or just setting up your sourcing business you are going to need to how to source property deals to generate leads and convert these into deals!
Without leads you have no deals and without deals you have no business!
Too often I see people investing thousands of pounds into strategy training only to find once they come out the classroom, they have no deals to apply all their newfound knowledge to!
You can have all the theoretical knowledge in the world but without deals that’s all your knowledge will be…theory!
This is why we focus so much of our attention at Goliath on how to source property deals and deal creation (i.e. everything that comes before having to think about the colour of your feature walls or whether to leave duvets on the beds for your tenants or box them up ready for the next property)!
Of course, you can make lead generation very complicated if you really want to. You can attempt to learn Facebook/Google advertising and try and learn everything there is to learn about ‘audience building’ and ‘retargeting’ but it really doesn’t need to be that difficult, certainly not at the beginning.
In this article I’m going to talk about the 3 property lead generation strategies to source your next property deal.
Two of the strategies will cost you nothing more than your time (and maybe a bit of fuel to go and view the properties) and the other does cost a little bit but you are in control of how much you spend and I’m going to share a few tricks to ensure the money you do spend is well spent!
Before we move onto how to source property deals, I first want to talk to you about who we are going to be trying to get in front of.
There’s a term we use for the type of property owners we’re trying to get to when generating property leads. We call them motivated sellers or motivated landlords.
They are motivated to find a solution for their property problems whether this is selling or renting.
There are A LOT of problems we can solve for property owners, which I’ll come onto a bit later but for now just remember;
Our job is to know how to find motivated property sellers and/or motivated landlords (sometimes also known as tired landlords)
But before we go into detail about who, let’s talk a bit more about how.
No matter how experienced you are, or how confident you are with your marketing, you will (or at least should) always start your property lead generation with the property portals (Rightmove, Zoopla, OnTheMarket) which also means you will be dealing with Estate and Letting Agents.
I’m guessing you’ve already been on Rightmove at least once and I’m also guessing, if you’re anything like me, you had great fun looking at lots of different property details (including those multi million pound mansions just because we can)!?
Well, the good news is you’re going to be spending a lot more time on the portals.
The bad news is you’re going to have to resist the temptation to look at footballer’s mansions and now start to get some property searching disciplines in place to avoid the pitfall of spending too much time on there!
Before going back onto the portals, you need to ensure you know the following:
This focus is paramount to property searching discipline. Without this focus you will end up just spending hours of your life aimlessly searching property details with one set of details merging into the next.
This is NOT GOOD!
This clarity means you can use the portal’s search filters so you are only looking at properties suitable for what you are looking to achieve.
It also gives you a set of criteria for “property alerts” so the portal will even let you know when new properties come on that are perfect for your strategy!
Now you have a list of suitable properties, it’s time to book those viewings in.
My advice, book no more than 5 viewings per day until you master the process of taking concise notes and have a system for remembering each property.
If you try and do too many viewings at the beginning, you will find yourself rushing and one thing you can’t do when it comes to your property due diligence is rush!
Also try not to spread viewings out over lots of days.
If you have 5 properties to view, try and view them all in the same day. Agents will try and get you to fit around their diaries, but you should try and remain in control.
Agents who are difficult will become targets for our direct mail campaigns, which we will come onto in a bit.
Once you have viewed the properties make sure you make any offers that same day.
This is easy when you have a slick viewing system in place as all the info will be pretty much done by the time you get home to do the final bits of deal analysis.
ALWAYS explain how you have reached your offer figure.
This will be based on your own market appraisal of the property including comparable analysis, rental yields etc, whatever is applicable to your chosen strategy.
I’m not going to go into detail on deal analysis here in this article as it’s not appropriate, but you can check out my other article INVESTMENT PROPERTY ANALYSIS: A BEGINNERS GUIDE for more on this part of the process.
DO NOT get into a bidding war at this stage.
You will get more rejections than acceptance at this stage. That’s just something you will need to get used to but remember, it’s totally normal.
The worst thing you can do is get into a backwards and forwards situation with your offer.
REMEMBER it’s the Agent’s job to get the best price for their client (the property owner).
Make your offer, stay strong and then just keep following up until your offer’s accepted or the property sells and completes.
We’ve covered Agents, who should always be your first port of call, but you will also need to master how to find motivated sellers directly.
As we mentioned before, the role of an Agent is to get the best price for their client (the property owner) and of course get the highest possible fee for themselves as this is usually based on a percentage of the sale price.
This means as a property sourcer, in order to be able to assess the best solution for a property owner’s needs, it’s always best to get direct.
We’re solution finders NOT selling agents
If the property owner wants to achieve the highest possible price (sale / rental) and isn’t bothered about how long it takes them, then they are not considered “motivated” and remember, you are looking to work with motivated property owners.
By going direct, you are able to listen to what the property owner’s problems are, what they want to achieve and how quickly they want to achieve it in.
All this information better equips you to negotiate great deals which are a win/win for everyone – NOT something an Estate / Letting Agents will do!
But how can you get direct to the property owner?
To keep things simple, I’m going to break this bit into two parts for you;
Just to be clear, there are lots of different ways to generate property leads but I want to give you the main three for you to TAKE ACTION and get going as quickly as possible.
Once you have set up campaigns for these three which yield results, you can start looking at others but these will give you the best chance of success.
There are 100’s of free ad sites out there where people advertise stuff for sale, for rent, for free! Sites such as Gumtree.com, Classiads.co.uk etc all have a property section where property owners (and Agents) can advertise their property free of charge, or for a small fee if they want to increase the visibility of their advert.
Private ads often allow you to email the advertiser directly, with some even giving you the advertisers telephone number. You really can’t get much more direct than that!
Even sites such as eBay have properties advertised for sale where you can contact owners directly!
It’s free which means the ‘barrier to entry’ isn’t restrictive. This means you are competing with other investors and Agents looking for new listings.
Free can also mean the property owners are a little more frugal than those who choose to use Agents which can mean they end up being timewasters but that’s the nature of the beast unfortunately and you may need to kiss a lot of frogs before finding that deal.
To give you a better chance of success I would certainly recommend calling private ads rather than emailing them.
This little bit of extra effort will put you ahead of the majority who will just email.
YES, it will make you step out of your comfort zone
YES, you will mess it up at some point, especially at the beginning
BUT it will also give you the best chance of success when getting direct!
So, we’ve covered a couple of free lead generation strategies, now let’s move onto by far the most successful lead generation strategy we use…
Direct mail is hands down the best lead generation strategy we have ever used when generating property leads for us and our clients.
It’s the perfect way to get direct to property owners, identifying their problems and solving them all in one letter!
Of course, If it was that simple, everyone would be successfully generating infinite leads using direct mail, but we have identified a ‘magic formula’ which helps us succeed the way we and our students do.
We’ve already gone into a bit of detail on finding motivated vendors / landlords but let’s go a bit further into how to identify who you’re writing to, the structure of your message and how to get the best results.
You’re probably thinking “what in the world are you on about Mark” but bear with me as this is important.
Often your prospect doesn’t think they have a ‘solvable’ problem. They probably just think it’s a headache they’ve always just dealt with and is just part of the process of owning property.
They don’t have a clue about the solutions available to them and they certainly won’t be searching online for a solution as, like I said above, they don’t think they have a solvable problem.
Then, as if by magic, your letter appears on their doorstep the same day their rent payment is late – again!
Or your letter arrives on the same day they called their agent asking why no one had viewed their property for a few weeks!
Your letter needs to feel like you’ve written specifically to them (i.e. not a mass mail out to everyone in the area).
Knowing your prospect is important but knowing the problems most suffer even more so.
By writing in this manner, addressing their issues directly and asking them to contact you to discuss the solution in more detail you will achieve much better results with your direct mail campaigns.
The days of simply writing a letter saying “I want to buy your house” have long gone! Get ahead of the rest by following this simple letter writing process:
Simple as that!
As with all marketing, you need to ensure you are keeping a track of your results.
Which campaigns yielded the best results
Which message got the best call back rate
Which campaigns yielded no results
By knowing and tracking your numbers you can then start to test different things out.
You can try handwritten letters instead of printed
You can try coloured envelopes instead of white ones
You can test email vs text message for getting in touch
You also need to give campaigns time to gather momentum. Don’t try things for one campaign and then give up because you didn’t get any results.
We would always recommend at least 3 campaigns before considering making any changes and even then, when changes are made just test one thing.
Don’t change everything at once as it will make tracking the effectiveness of the changes almost impossible!
One final thing from me before you go off and start your portal searching…
Remember marketing takes time to perfect with even the masters of the industry constantly testing and tweaking to improve results.
The reality in our industry is that most will only act for a short period of time before giving up and moving onto the next lead generation “magic technique” taught by some ‘guru’ who’s been in the industry for 5 minutes!
You need to ensure that you ‘stay in line’, keep sending out your marketing campaigns and stick to the three in this article for the time being.
I promise you it will stand you in good stead and you will see the results start to show!