7 Best Wholesale Real Estate Lead Generation Methods
In this article, you’ll learn how to get wholesale real estate leads.
We’ll review strategies that seasoned real estate investors use, and by the end, you will be able to pick the best method(s) for your business.
Keep reading to learn how to get leads for wholesaling real estate.
The most straightforward way is to purchase leads from professionals specializing in generating them.
The advantage is that for a reasonable fee, you get a regular flow of leads without having to spend time and money to generate them.
Lead generation companies who specialize in this specific task only, have already set up and finetuned their processes to keep the costs as low as possible.
Buying leads from professionals may still be cheaper for you than what you will probably spend trying to set up your own process while at the same time managing other aspects of your business.
Obviously, not every provider’s lead quality is worth the money they charge. For this reason, we compiled this list of the best lead generation services for real estate investors.
Additionally, we at Real Estate Bees also have a program to supply real estate wholesalers and investors with high quality motivated seller leads — REB Leads.
Through this program, we offer leads at prices that you won’t see anywhere else in the industry — $12.50 or $20 per lead.
Such ridiculous rates don’t mean the quality of our leads is low. The reason is that at present, our program is in the beta phase. So take advantage of this opportunity while it’s available.
Unfortunately, the number of members we can accommodate is limited. However, each month, we open the program for enrollment for just a few days (and sometimes hours).
If the REB Leads web page currently shows you a message saying the program is closed, sign up for the waiting list to get notified as soon as it’s open for enrollment of new members.
Your blog is a vehicle that you can use to drive motivated sellers to your lead capture landing page or contact form.
Blogging is a great way to establish authority as an expert in the industry and generate leads.
You want your blog to educate individuals on the value your business brings. However, your blog articles shouldn’t be all about your business.
Write articles on topics that motivated sellers look up on the internet. For example, ways to sell a house fast, how to avoid a foreclosure, how to sell a house without a real estate agent, etc.
Among various ways suggested in your articles to resolve the readers’ problems, include selling their house to an investor and offer your services. Include a link to your lead capture form.
Each blog post needs to have:
- A call to action. You must explicitly tell your readers what you want them to do. Otherwise, they will read, take in the information and leave. The content will show you are an expert at the topic, but the call to action and a link to your lead capture form will show them how to start working with you. It also helps to use one of the best real estate AI chatbots. They can answer some user’s questions immediately (and capture their contact info), which is important for homeowners in an urgent situation.
- Relevant keywords. Take the time to research keywords by using tools such as Ahrefs, SEMrush or Moz. You want to understand the exact wording that motivated sellers use to search for topics that relate to your business. Use those exact phrases in the titles of your articles and in your content. Using relevant keywords in the appropriate places (not just repeating the keywords where it isn’t relevant) will make your posts rank higher on Google. Learn more about properly optimizing your content from the guide to real estate SEO.
It will take some time before your blog posts start showing in search results. However, the advantage of this method is generating motivated seller leads on autopilot.
Once an article is published, it doesn’t require payment or maintenance to keep generating leads for you (if you don’t count overall website maintenance and domain and hosting fees).
Obviously, to start a blog that generates leads effectively, you will need a good website. If you don’t have one yet, study our list of the best website builders for real estate investors.
Posting Bandit Signs
Bandit signs are poster-sized signs widely used to find motivated sellers to wholesale real estate.
Bandit signs are placed on the sides of busy roads with short verbiage that will pique people’s interest.
Almost all wholesaling bandit signs say variations of the phrase: “We Buy Houses.” Some might say, “We Buy Houses Fast” or “We Buy Houses for Cash.”
Whatever phrasing you choose, your phone number is the most critical information on a bandit sign.
You want the phone number to be prominent enough that someone can read it while speeding by.
Some quick tips when it comes to designing and placing bandit signs are:
- Visibility over quantity. Many wholesalers will randomly place a ton of bandit signs around their city without being critical about placement. It’s better to have a few bandit signs in highly visible locations with lots of pedestrian and vehicular traffic than lots of bandit signs where no one will notice them.
- Use an easily readable font. Too many wholesalers try to make their signs look pretty or match the color to their brand logo. Instead, use dark colors and a bold font that people can easily read.
- Track your leads. Many wholesalers are so excited when they receive a call that they forget to ask the seller where they saw their sign. Understanding where your signs create the most buzz is essential if you want to spend your marketing dollars efficiently.
The main advantage of this method is that motivated sellers come to you and they are warm leads. You don’t have to chase them down by using real estate skip tracing. Signs are also cheap.
But keep in mind that bandit signs may be forbidden in your municipality. Research your local laws before using them.
This method works well in combination with live answering services for real estate investors. Outsource talking to leads and qualifying them to trained call center specialists to save your own time.
Driving for Dollars
Driving for dollars is a boots-on-the-ground approach to getting wholesale real estate leads.
This method of finding properties to wholesale entails getting in your car, driving around your target areas, and looking for run down or abandoned houses.
Homes in disrepair are typically easy to spot, but there are some other signs that a homeowner is distressed that are a little more subtle.
You want to look for:
- overgrown lawns
- junk cars in the yard
- piled up newspapers on the porch
- overflowing mailboxes
- no curtains or anything covering the windows
- broken or boarded-up windows
Investors and wholesalers often hire real estate bird dogs for this job to save their own time.
These tools allow you not only record your route when driving for dollars but also call motivated sellers and send them wholesale real estate postcards right from the app.
Searching County Records
Searching county records can be an effective method to get leads for real estate wholesalers.
Every county has an office that collects taxes, often referred to as the Tax Assessor or the Tax Collector.
These offices will have information on every real estate unit within that county. This allows you to find properties with tax liens or find out who owes back property taxes.
The information you can find includes the homeowner’s names, the property’s value, and, most importantly, the taxes owed on the property.
County officials are incentivized to sell these tax delinquent properties to someone who will pay the debt off.
Therefore, you can usually call the relevant office and ask for a list of properties with tax delinquencies.
Once you get a list, you need to determine the most important criteria and then set criteria to find the homeowners you want to contact.
Examples of criteria used to pick properties to target include:
- The amount of back taxes owed. Homeowners with over $10,000 in back taxes will be more motivated to sell than homeowners with a $1,000 tax debt. Do the research and pick a number you believe will entice a homeowner to sell. Then, pull all properties that owe that number or more in back taxes.
- The ratio of back taxes to property value. Because you will need to pay the back taxes on any property you buy, you may only want to target homeowners who owe less than 10% of the home’s value in back taxes.
Do your research and assess your business goals to determine the criteria that will work best.
Additionally, if you are tech-savvy, you can skip going to the courthouse.
By using some of the real estate investing apps in conjunction with the best skip tracing software for real estate investors, you can get information about tax delinquent properties pulled from public records online, together with the owners’ contact information.
Running Online Ad Campaigns
If you have marketing dollars available, running online ads is a way to quickly and efficiently reach your target audience.
Many wholesalers utilize pay-per-click or PPC ads to drive leads to their website. A pay-per-click ad is a paid ad that charges you every time someone clicks on your link.
The most common type of PPC ads are search ads. These paid ads appear on the top of your Google search and have a bolded AD in front of the search result.
When setting up a PPC ad campaign, research the keywords or phrases people type in Google when they need to sell their house fast in your area.
Then, you can set up a campaign for these phrases, and your ad will pop up at the top of Google when someone searches for a phrase you have targeted.
This kind of marketing typically brings in a lot of leads in a short time, but can be expensive.
Many wholesalers will also utilize Facebook ads to target motivated sellers.
Most homeowners have a Facebook profile, which can be a quick and efficient way to spread the word about your services.
When setting up a Facebook ad campaign, you can select the demographics of your ideal seller and target these individuals.
You can target Facebook ads based on age, gender, job title, education, location, etc.
While it’s harder to target motivated sellers specifically, a Facebook ad casts a wide net and then it’s up to you to quickly qualify the good leads.
With paid online ads, you can also set a budget, so you don’t overspend on your ad campaign.
Many investors and wholesalers outsource managing their ad campaigns to specialists. Look into this option by reading our guides that review:
When determining how to find leads for wholesaling real estate, too many people overlook the benefit of networking.
Networking can be an incredibly efficient way to find various types of motivated sellers and learn about the real estate industry from seasoned investors.
A great way to get started is to research local real estate investment associations (commonly referred to as REIAs).
Most REIA’s meet monthly and allow nonmembers to attend one meeting for free.
Plan on attending and aim to speak to at least five people.
These organizations are filled with expert real estate investors with a lot of advice to give and often want to pass their knowledge on to hungry new investors.
Seasoned investors may be willing to pass a few motivated sellers along in exchange for a referral fee or percentage of your assignment fee.
They may be willing to walk you through the deal and keep you from making rookie mistakes that will cost you money.
You also might meet other individuals in the real estate industry, like probate and real estate attorneys, who may be willing to pass your business card along to individuals inheriting a property.
Contractors and service workers, like lawn care specialists, are also great people to have in your real estate sphere too.
These individuals are out in neighborhoods every day and may be willing to bring you addresses of run down houses for a finder’s fee.
Not only can networking get you wholesale real estate leads, but it also can help you find real estate investors to wholesale properties to.
How to Pre-Qualify Leads for Real Estate Wholesalers?
Now that you know how to find motivated sellers for wholesaling, you need to also learn how to quickly pre-qualify your leads.
Here are the factors that make a homeowner a motivated seller:
- Is the seller urged to sell? If the seller does not have an important reason to sell fast (getting divorced, being in preforeclosure, having a tax lien, etc.), then they probably won’t consider an offer under market value.
- The equity in the property. If the owner owes too much on their mortgage or in unpaid taxes, you won’t be able to get the homeowner the money they need and still have a room for a discount for your cash buyer plus your assignment fee.
You want to understand these two motivations before making an offer or walking the property.
If you don’t have answers to these two questions, you could be wasting your time pursuing a bad wholesale deal.
Determining a seller’s motivation is extremely important when pursuing a wholesale deal.
You want to target homeowners who have an immediate need to sell, not a potential desire to sell in the future.
A property owner typically decides to sell to a cash buyer for under-market value because they do not have the time or money to fix up their property and list it the traditional way.
Maybe they’re going through a divorce and want the stressful process to end as soon as possible. Maybe they have a new job out of state that requires them to relocate quickly.
Maybe they’re behind in taxes and want to act before the county auction and eviction.
Whatever their motivation, you want to determine their pain point and show how your services can solve their problem.
Common properties wholesalers target are:
- distressed properties (tax lien or lender preforeclosure)
- vacant homes
- run-down homes
- inherited homes including properties currently in probate
- properties of divorcing couples
- relocating homeowners
Especially, wholesalers try to find distressed properties because homeowners in preforeclosure have an urgent need to sell.
Avoiding foreclosure is a stronger motivation than wanting to sell a house just because the owner has no time to maintain it.
Now that you know your seller is motivated, you need to determine the equity currently in the home.
Equity in a deal means that the house is worth more than what the homeowner wants for the property, plus the amount owed to the lender, tax authorities, or any other debt.
The more equity in the home, the more potential profit for you.
For example, imagine a homeowner wants to walk away with $30,000 in cash for their property and owes $25,000 on the mortgage.
If you want to wholesale this property, it has to be worth more (in its current condition) than $55,000.
You also want to factor in how much you want to make off the deal (your assignment fee). If you want to make $10,000 on the property, the property must be worth more than $65,000.
You need to determine the homeowner’s motivation and equity in the property before making an offer or walking the property, as these factors will tell you if the deal is worth pursuing.
While asking a homeowner about these financial details, be careful to avoid seeming suspicious as the owner may not want to disclose this information over the phone.
Read our article about calling motivated sellers where we provide a real estate wholesaling cold calling script.
If you want to contribute your expert advice on a topic of your expertise, feel free to apply to our Expert Contributor Program.
About the Author
Kristina Morales is a REALTOR® with over 20 years of professional experience. She actively practices real estate in Ohio but also has practiced real estate in California and Texas. Conducting her real estate business in three states has allowed her to gain unique experiences that make her a well-rounded realtor. She obtained her Bachelor of Arts in Business Management and her MBA with a concentration in Banking and Finance. Prior to real estate, Kristina had an extensive corporate career in banking and treasury. She ended her finance career as an Assistant Treasurer at a publicly traded oil & gas company in Houston, TX.