In this post, I’m going to tell you about the importance of having a system for keeping track of your leads and how doing so allowed me to buy a house that I had been trying to buy for over 8 years!
Do you have a stack of listings and other leads printed out and sitting on your desk?
Did you plan on eventually going through them and following up with sellers and agents to see if there has been a price change or if the sellers have become more motivated?
Do you ever get around to that or do you keep crossing it off your To Do list without actually doing it and moving it to a day one week or even one month from now?
Join the club! It’s horribly inefficient and we lose lots of deals because of it, but dang it, it seems like we are just wired to do it that way.
First, have you joined our private FlippingJunkie facebook group? Come network with us!
Most investors will get a motivated seller lead and write it down in their handy dandy notebook. This is where the chicken scratch will be laid down as deal analysis is done and recorded…usually in such a way that it makes it nearly impossible to decipher what was written, even just one day later.
I’m sure you know what I’m talking about. We are usually in such a hurry just to figure out whether the lead has the potential to be a real deal that we don’t concern ourselves with how we are managing that information. We aren’t thinking about how we may need to keep that information more easily available and organized for follow up purposes.
There are full notebooks sitting in my office that span back to at least a couple years. I haven’t thrown them away because I can’t bring myself to, just in case a seller calls that I had spoken to before. It’s crazy.
Even if I do get a call from a seller that I had spoken to before, and if I use those notebooks to find the information I had written down before, it would take hours to find it!
Not only that, I’m not sure I’d even be able to decipher what I had written down, so it would all be a huge waste of time!
I’ve used notebooks to record lead details, but I also have a “system” that I use that makes it possible to quickly and easily find this information whenever and wherever I want to. More on that in a minute…
If you’ve been marketing to motivated sellers for any length of time, you probably know that up to, and possibly more than, 50% of deals come with follow up instead of during the initial negotiations. This means that most investors are leaving deals on the table… lots of deals! Time has a way of motivating people to sell their house.
A seller that is not interested in your offer right now could decide that it is a great offer after time changes his/her mind. Nobody’s life is free of problems. Over time these problems can happen and accumulate and cause their position to change. They no longer have the ability or desire to “hold out” for a better offer.
They now just want that cash and to be done with their house problem!
But, what if they don’t remember who they talked to or did not keep your card or your offer?
This is very common.
There could be 6 months or even a couple years that go by before circumstances create the motivation to trade the house for your cash offer.
At that point, if you haven’t been following up with them, they will likely start their search over again and end up selling to one of your competitors. We don’t want that.
Some investors use spreadsheets to manage their leads. Click here to see one way to do this using spreadsheets that my friend, Shae Bynes, recommended on BiggerPockets.
Other investors spend countless hours trying to configure a CRM system like Zoho that is built to be general enough to allow it to work for every conceivable use… which makes it hard to make it work exactly right for your specific needs.
To me, spending my time focusing on the 20% of things that produce 80% of my results (Pareto’s Law) in my real estate investing is the smart thing to do. I’d rather be spending my time analyzing deals, viewing houses and making offers.
It’s a fact that most of us have trouble getting out of our comfort zone though and so we end up avoiding these massive results producing activities by spending days trying to configure a system we will never use because we aren’t doing the things necessary to generate real estate investor leads in the first place. We have to break through those limiting issues and focus on taking action.
Without action, you’re just stuck where you’ve always been!
Regardless of which system you use, spreadsheets, CRM system you configure, writing things on the back of your hand and down your leg, folders or notebooks, there are several things that are very important to keep track of to maximize your chances of getting the deal.
This list is in no way exhaustive, but it will definitely get you on the right track to benefiting more from each lead.
I kid you not. Yes, I finally bought a house I had been trying to buy for nearly a decade.
Years and years ago, I sent the owner of a run-down, large, two-story house in a historic district a letter explaining that I would like to buy it.
The seller explained that he was interested in selling but that his grown kids were against it. I had made an offer and followed up with him religiously every month for about 8 months. Then I waited about a year and contacted him again. Then I contacted him again after another year….
Honestly, I gave up after that.
Then, out of the blue, the seller called me a couple of months ago and said he was ready to sell!
We ended up buying the house for pretty close to our initial offer and were able to wholesale it for a profit of over $30,000!
We were going to fix it up but I just didn’t have the time to take on such a large project that would have likely taken at least 3-4 months (probably closer to 6 months). Wholesaling it made the most sense as our return on investment and return on time invested were astronomical.
Just goes to show you the power of following up with sellers until they either sell the house, or they start talking about a restraining order.
Bear with me…and don’t worry, I won’t bust out a slide show.
My full-time job before I became a real estate investor was as a software developer. I really enjoy the challenge of designing and creating software…but didn’t really enjoy doing it for someone else.
I wanted freedom.
I wanted the freedom to be my own boss, vacation when and for as long as I wanted, to control what I did every day and have control over how much time I was able to spend with my family.
Flipping houses gave me that freedom.
But, I never lost the urge to develop software. Since the beginning, I’ve been creating software to help me manage my leads. It’s been through many iterations and was always just built for myself to use.
Then, one day years ago, it dawned on me that maybe other investors would like to have just such a system. There were a couple of other systems out there but they were either million-dollar custom systems for large investment companies or systems that were priced way too high for most small investors to justify the cost. Why not allow them to use the software I’d been creating and improving for years?
Thus, FlipPilot was born. FlipPilot is more than a CRM. There’s not really a single word or phrase to describe what it does, because it really is the very first of its kind for real estate investors. It is everything in one place. We were evolving as investors, and we needed a software that was going to continue to evolve with us. All of the existing technology only allowed us to work IN our business, but it wasn’t giving us the freedom that we wanted. FlipPilot changes all of that. Click here to join the list to be notified when we go on sale to the general public.
-Danny JohnsonPrevious: Free House Flipping Software: Our Top Pick
Very good reading. I enjoy your blogs. I am starting my wholesale real estate business very early 2015.
Thanks, Ellen. Don’t forget to write down your goals. Studies show that people with written goals are almost 50% more likely to complete them. Then, share your goals and updates with someone as that usually improves chances even more. 🙂
I will admit I’m in love with Podio, but if this is built specifically for wholesalers and retail flippers this could be a game changer. Looking forward to seeing it!
I’m working really hard to make sure this makes things even easier than using those systems. Being that it is built specifically with us in mind, it will be. Can’t wait to make it live.
Hopefully some 3rd party integrations will be available with the use of Zapier or IFTT programs? I’d love to be able to continue sending follow up letters via the click of a button from my CRM.
Yes, I am going to have some integrations like you mention. It will be something that will be added over time, but we will have some great whens from the get go. 🙂
Brilliant writing, Danny!
This post is very informative. I gained a lot of knowledge from it. It shows how experienced you are.
Please keep us informed. We need the knowledge.
Great stuff Danny – looks like an awesome product! Any way you can integrate our previous idea of being able to back potential buyers into deals? I’m still finding I could use this!!
It’s been so long since we talked about that, we should probably talk some more about it. I’ll send you an email.
I do have some leads that I have been working on for a couple years as well. One replied every month I sent a message for about a year, then unfortunately fell off the radar. I really hope they come full circle as well.
You never know when they will come full circle. I’m a firm believer that if you keep these leads in your mind, they will eventually work out. Faith.
Hey, Cameron. Great to see you checking out Flipping Junkie!
What’s the latest on your lead system? Have you launched it yet? How do I check it out?
Very nice copy, by the way.
I’m getting very close to releasing it. We will be doing a “soft” release by mid-April (about a month). I’m going to allow about 20 (maybe a little more) people to sign up. This is because it’s brand new and I’m sure we will have some things that need to be made easier and to make sure things are running smoothly before the actual release when we let as many people that want it to sign up. I know you are a LeadPropeller customer so you have a chance to get in on the “soft” release if you want to.
You can check out more about it at http://reimobile.com.
Definitely a fun story there – I’d rather not get restraining orders myself! You made some great points there though. Thanks for sharing!
Yes you most definitely need a good way to track leads. Without something in place, you will soon become lost chasing post it notes and scrap paper that you wrote a few notes on. Even an easy Excel sheet will do the trick until you can upgrade later.
If you want to succeed with real estate, the number one priority is for you to find motivated sellers.
If you can’t do this, then the rest of this process isn’t even worth talking about, because this whole game begins and ends with your ability to find sellers who will accept your low offers and play by your terms.
You hit the nail on the head, Jonathan. I couldn’t agree more!