BatchLeads has a new Agent Outreach feature in which users can now connect with more than one million real estate agents. Not only can BatchLeads users access agents’ contact information, it also offers them specifics such as how many deals an agent has closed, how much their properties sold for, and how long they were on the market.
While having this data is a huge advantage, it’s only useful if you know how to communicate with agents. Jamil Damji and Ryan Zolin are both experienced pros who have developed a strategy for using data to target their agent outreach. They recently shared their perspectives and insights on the best practices for agent outreach.
While a lot of wholesalers try to avoid working with agents, Zolin and Damji know firsthand how invaluable agents can be. In a webinar we recently hosted with Jamil Damji, A Whole New World: Breaking Into On Market Listings, he states that “Thirty to 40 percent of our volume is sold through a realtor. They can bring you opportunities and sell your opportunities.” Real estate agents are a massive resource for real estate leads, so any wholesaling strategy that doesn’t include agent outreach is incomplete.
When working with an agent, you’re also reaping the benefits of the volume of contacts they have. According to Damji, real estate agents communicate on average with about 50 buyers per day, which amounts to thousands of real estate leads over time. The more real estate agents know about your deal, the greater your reach will be.
Below are six key takeaways to help you build a successful agent outreach strategy.
It’s now easier to find interested real estate agents
With the dip in home sales, the majority of real estate agents would rather work with a wholesaler than not sell at all. When a distressed property is available, real estate agents are competing with iBuyers, so they are open to working with a wholesaler who can connect the agent to a cash buyer.
Despite there being low inventory in most major markets, Damji points out that wholesalers have an advantage because at any given time in the US there are about 5 to 7 million zombie houses–properties in significant disrepair that have been vacant for a long time. Many of them have potential equity due to the length of home ownership, but a lot of buyers avoid them because of the level of repair they need.
Make fair offers
Do not lowball an agent, as this is a sure way that you’ll never hear from them again. “Old school wholesalers were more prone to making low ball offers or being dishonest about their intention to wholesale properties,” says Damji. “Focusing on adding value to the situation has elevated the business.”
Damji has developed a script when he makes his offer, which is along the lines of “Please don’t be offended; I’m not going to low ball you. I have to make a profit, but I’ll give you the maximum amount I can for a house in that condition.” It’s even better if you can show them your calculations for the property’s after repair value (ARV).
Be honest with real estate agents
We said above that real estate agents have historically been averse to wholesalers. That’s often due to a previous negative experience, like lowball offers or deceptive practices. It can only take one negative experience for an agent to decide that it’s not worth working with wholesalers. As Ryan Zolin explains in his Agent Outreach Live series, he still sees agent listings who specify that they won’t work with wholesalers.
Zolin is an agent himself with seven years of experience and knows how to appeal to agents. When reaching out to agents, he says that you need to be ready to provide your “buy box,” which is the type of property you’re seeking, including the price range and geographic area. You’ll also need to share your proof of funds and your last few deals.
If you haven’t done any deals yet, agents may avoid working with you, so it’s in your best interest to partner with another investor to give yourself confidence and legitimacy. When you let agents know that you’ve partnered with someone who’s more experienced, that will be reassuring to agents and they will appreciate that level of authenticity.
Of course, there’s honesty and there’s total transparency. When you’re establishing a relationship with an agent, Demji says that you should avoid mentioning that you’re in the process of vetting multiple agents. That could make the agent feel like it may not be worth their time to work with you, however unfair that reaction is.
You have more leverage than you realize
When it comes to approaching an agent, the value of your deal is a lot more important than who you are or your background, so don’t try to come across as more experienced than you actually are. Zolin recommends an open and direct approach. “Introduce yourself as a local buyer. Explain that you’re looking for distressed properties, hoarder houses, et cetera. Speak confidently and tell them exactly what you’re looking for.”
Ultimately, Zolin explains, “When you’re talking to Realtors, you’re not selling them. They’re selling you. You can get straight to business.”
Don’t commit to open-ended agreements
Once they’ve agreed to work with you, some agents may want to establish a long-term written agreement. Demji advises against this. “Only sign an agreement that’s property specific,” he says. Some agents may push back against this, in which case Jamil lets them know that he’s a prolific investor and that they couldn’t meet his expectations. Another response he recommends is “it wouldn’t be fair to the other agents I work with.” Regardless of how the conversation transpires, do not commit to a long-term arrangement. Your success would become dependent on one agent’s performance.
Set realistic expectations
Zolin cautions wholesalers to not be “crazy ambitious right away.” The average realtor does 10-11 deals per year while the average investor does seven or eight. He also recommends that newer wholesalers keep their day job at the outset so your financial survival isn’t dependent on a deal closing. While you’re at your day job, you can automate some of your wholesaling duties or hire a virtual assistant to make calls for you.
If you’re new to wholesaling, Zolin suggests sticking to properties that are within driving distance. Eventually, once this becomes second nature you’ll be able to buy properties that are on the other side of the country.
Conclusion
While it sounds like wholesalers and real estate agents have an adversarial relationship, that’s far from the case. Wholesalers can develop long and successful relationships with realtors, as Damji and Zolin both have. But a successful agent outreach strategy is based on what you can do for the agent. While you continue to make inroads with agents, making a point of understanding the agent’s objectives will enable you to partner with agents more effectively.
