Learn the best real estate lead sources for real estate agents, along with their different conversion rates and benefits.
In this virtual mastermind, we are going to talk about the best real estate lead sources. From the get-go, I do want to remind you that your sphere of influence (SOI) should always be front and center when it comes to lead sources. None of the lead sources we discuss today should take the place of what you do on a daily basis to contact your SOI.
VIDEO: The Best Real Estate Lead Sources for Agents
Always work your sphere of influence (SOI) first
Usually, when you get into the winter months, the amount of available leads goes down. The available inventory goes down. So it is harder to find the low-hanging fruit. These are the people that are actively looking to buy or sell. During this time, you must really buckle down and work your SOI. You are laying the groundwork and filling your pipeline for the spring and summer months ahead. This will always be your “best” real estate lead source. Yes, today we will talk about other “best” real estate lead sources, but it bears repeating. Never neglect your SOI.
How clients find their agent
This is why your sphere of influence (SOI) must always be your first resort, not your last resort. The chart below is from the California Association of Realtors 2019 Housing Market Survey. How did clients find their agent? You can see that 77% of clients find their agent through a relationship. THIS IS YOUR SOI! No matter what other best real estate lead sources we talk about, your SOI will always be number one.
This is why you should not be freaking out about other lead methods. Online leads, farming leads, social media leads, expired leads, open house leads, etc. We are not knocking these other methods, by any means. In fact, we coach on them here at ICC. All that said, you must accept the fact that of all the best real estate lead sources, your sphere of influence will always be THE best. Everything else makes up the remaining twenty percent of your business.
The other lead generation pillars of your business
Besides your sphere of influence, every Realtor should have at least two or three other “pillars” of lead generation. These are the best real estate lead sources for each individual person. When we talk about these “other” sources, they involve prospecting leads from people you don’t already know. Through prospecting and reaching people you don’t know, you are at the same time growing your SOI database. It’s logical to do this because it grows your SOI!
The best real estate lead sources (in addition to SOI)
Okay, at last, I will tell you what I think are the best real estate lead sources to do alongside your sphere of influence (SOI) lead generation.
- Expired listings. They are low cost and take low effort and time. Good prospectors can expect a high conversion rate on expired listings. It takes practice, but good prospectors can see a conversion rate as high as 17:1.
- FSBOs. I put this at a conversion rate of about 35:1. If you can stay in contact (nurture) for a period of 6-8 weeks with 35 For Sale By Owner listings, you’ll win one listing. The hard part about FSBOs is that they typically do not like real estate agents.
- Circle prospecting. The true cold calling! You’re calling around about an active listing. The conversion rate on circle prospecting would be around 50 or 60:1. It’s cheap and easy, which makes it a great lead source.
- Premium portal leads. For example, a paid Zillow lead or Realtor.com lead. The public loves these websites for looking at houses. These are expensive leads — hundreds of dollars per lead. These leads are easy to convert because they are asking to talk to you!
- Forced registration leads. Google pay-per-click ads, Facebook ads, etc. are much cheaper and have a much lower conversion rate. They are called “forced registration” because people searching for homes are forced to put in their information in order to continue their search. They don’t necessarily want to talk to you, so they may not be ready. The conversion rate is very low … usually around 2%. These leads also require nurturing, so it is a time commitment.