The goal of every Realtor should be to have a large database of people who know you personally as an agent and will give you their own business and refer business to you. These people are usually referred to as your Sphere Of Influence or SOI for short and include past clients and people you have showed homes to or did property evaluations for.
Until you have been in the business long enough to generate a large SOI you need to find your own buyers and sellers by prospecting.
Early in their careers agents typically work with buyers that they meet passively by doing open houses for other agents, advertising, or from website leads. Their next step is actively prospecting by talking about real estate with people they know already or people they don’t know. Most agents soon conclude that it is far more profitable and easier to work with sellers than buyers. The top agents in any market area usually get 70 to 80% of their income from listings.
Websites and the internet are a great source of buyer leads but a poor source of seller leads. To get listings agents need to actively prospect for people who are planning on selling their homes. To do this many spend huge amounts on advertising and repeatedly targeting specific market areas with flyers and admail. For this to work many repetitions are required over a period of time and after risking massive amounts of cash the results are often inconsistent.
If you don’t have the deep pockets to see such a strategy through don’t fret! One of the oldest and lowest cost methods of prospecting for sellers is still one of the best methods and done right provides the most consistent income. I am talking about cold calling!
Many agents do call the owners of expired listings and find they are competing against many other agents and the sellers are unrealistic and difficult to deal with. That gets tiresome real fast. The same is true for calling FSBOs. Compared to calling Expireds and FSBOs real honest to goodness cold calling can be a breeze. You can end up working with nicer people who are actually motivated to sell.
Agents who make cold calling their primary source of listings will work the phones for at least a couple of hours every day and have refined their technique so they are talking to a hundred or more potential sellers in those few hours. They qualify those prospects ruthlessly and only consider one or two each day a bonafide lead that will move within the next few months. For many, calling for a couple of hours a day 5 days a week results in 50 to 60 deals a year!
Luckily, they are happy to share their methods, dialogues, and all the nuances in the Cold Calling Forum at the AgentsOnline Realtor Forums. Check it out!
I will delve a bit deeper into this real estate prospecting technique in my next article.