THE BIG PICTURE
STRATEGIES: FLIPPING
Conversion is the Key IF YOU WANT TO BUILD INVENTORY FOR YOUR FLIPPING BUSINESS, GETTING LEADS ON MOTIVATED SELLERS IS ONLY PART OF THE BATTLE.
by Danny Johnson
I
don’t ever get any good leads …” “You can’t get deals like that where I live …” These are just some of the statements I hear all the time from real estate investors who haven’t honed their lead- to-deal conversion ninja skills. Mostly likely, the problem isn’t that they aren’t getting good leads or that those kinds of deals can’t be found where they are. Rather, the problem is almost always that they just don’t know how to proper- ly convert those leads into deals. IT’S BAD BUSINESS TO NOT MAXIMIZE YOUR LEADS Maybe you’ve heard that house flip- ping is all a numbers game. That’s true. But some of the commonly cited numbers and formulas aren’t always accurate. Take the ratio of leads to deals, for example. It’s said that it takes 100 calls to get 10 great leads that ultimately will result in one deal. I don’t like those numbers at all. We can do better than that. Much better. In my house flipping business, we regularly make offers on 33 percent to 50 percent of the calls and online submis- sions we get. That already is much better than the 10-to-1 leads-to-offers ratio for a typical house flipping business. From those offers, we typically buy 20 percent to 30 percent of the houses. Again, that’s much better than the abys- mal 10 percent that is commonplace. Here’s how to improve your conver- sion rates with ease.
that it’s about building good rapport. Most motivated sellers who call are unsure of what is involved with selling their house to a real estate investor. You build great rapport by being confident on the phone (difficult in the beginning for most, so don’t worry if even thinking about answering calls from motivated sellers causes anxiety) and taking the time to explain the pro- cess of buying their house. Being confident comes from being prepared to answer their questions. We cannot guess all the questions that will be asked, but we can be prepared for the typical ones, such as: “How does this work?” “How much can you give me for my house?” “Will I have time to move?” “There are tenants in the house. Is that a problem?” APPOINTMENT Think about the situation from a motivated seller’s perspective. That person has a house that he or she wants to sell and is searching for some- one to buy it. If you were in that seller’s shoes, you’d probably be a little nervous about the process and possibly embar- rassed about the state of your house. You probably would be happy talking to someone who answered the phone right away, was friendly and confident and sounded interested in buying your house. As an investor, you let that seller know you are interested by immediately setting an appointment to see the house. NO. 3 WE IMMEDIATELY SET AN
DESTROYYOUR COMPETITION Competition is the reason so many real estate investors hover around the 1 percent range of calls to deals. (Remem- ber: 100 calls, 10 offers, one deal). Other investors are snatching up those deals. There are four specific things we do that much of our (and likely much of your) competition just doesn’t do consistently. OURSELVES AND IMMEDIATELY When our marketing generates a call from a seller, we immediately answer that call—no matter what we are doing. Even if we are at the dinner table, we will stop and answer the phone. I’m constantly told by motivated sell- ers that they just started calling phone numbers for people who buy houses, and I was the first one to answer my phone out of the five to 10 they already called. Guess who’s more likely to get the deal? Some investors use call centers to answer phone calls and get information from sellers. This is a decent solution if you do not have the ability to answer the phone. The problem I have with this method is that you completely lose all ability to create rapport with the seller. Building rapport with a seller is more important, most of the time, than the offer you end up making. Do not discount this. This how you beat your competition every time. NO. 1 WE ANSWER OUR PHONES
WE EXUDE CONFIDENCE ON THE
NO. 2
PHONE This relates to the previous advice in
38 | think realty magazine july :: august 2016
Made with FlippingBook Online document