Yield Hungry Investors Discover New Real Estate Opportunities Online

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High yield seeking investors are finding exciting new investment opportunities in a $200B online landscape

JP Maroney and his investors have found a new form of real estate online. So, far this new frontier has been delivering strong double-digit returns, with no signs of slowing any time soon.

While the massed has been desperately searching for yield, a few has discovered high returns in the new digital economy. Bonds and CDs may be paying negative net yields, and the stock market as a whole may be so over bloated that price to earnings ratios are a joke. Yet, there are opportunities out there. At least for those willing to adapt to the fast-changing world we live in now.

From Aging Technology to Albert Einstein-Like Epiphanies

JP Maroney started his first company at 19 years old. In the 90s, he was running successful magazine companies, which he successfully exited in 1999. He and his wife went on to launch a video training company for franchises and trade associations. In 2004, Maroney upgraded to the arena of online coaching, and began generating leads online. Out for a walk one evening, JP was thinking over a recent news show on MSNBC or CNBC, in which a top fund manager was talking about the importance of embracing alternative investments, providing they could put a dollar in, and get a reasonable yield out.

This was JP Maroney’s “Eureka!” moment. He gained a new perspective, which has paid off handsomely. He realized he was already investing in online real estate, with great success. He was investing in online lead generation to the tune of around $2.50 per lead, and was easily able to sell those leads at $3-$5, and flip his money for outsized returns and a big IRR every 30 days.

The $200B Online Investment Landscape

The importance of the internet, and the ability to effectively and efficiently get in front of, and connect with consumers, with measurable results verifiable for every dollar spent in marketing is obvious. At least 19 of the biggest and best-established retailers in America are either going bankrupt, or are at least slashing stores and staff, and are cashing out their brick and mortar real estate. They just started marketing online too late. Then we have Amazon, who is leveraging its online prowess to dive into brick and mortar assets, becoming the largest landowner in Seattle, and taking over Whole Foods with a $14B bid.

Digital marketing is already a $200B business and growing. It’s already bigger than TV advertising, including the Super Bowl. Most entrepreneurs and VCs look for at least $1B to $2B markets as a measure of a good industry to be in. This is already 100x that.

43% of respondents in the State of Digital Advertising 2017 survey and report said they increased paid search advertising between 2015 and 2016 alone. eMarketer estimates growth in US digital ad spending to accelerate at 9.9% to 28.4% per year between 2015 and 2020.

Getting Responzive

From realizing he was doubling his money every 30 to 90 days in digital advertising, and realizing he could do it for investors too, JP has delivered double digit returns for others for 4 years straight. His biggest problem has been having to under-promise, as the returns on digital marketing make current bond, stock, and fund yields look like a joke.

Maroney’s B2B facing portal, Responzive, eliminates the need for ‘hope and pray advertising’, and enables businesses from real estate to insurance companies to obtain ready to buy consumer leads, on-demand. JP says that the service is for serious businesses and those serious about scaling quickly, and have an appetite for 5k+ leads per month.

The New Frontier

JP Maroney’s investment firm Harbor City Capital has appeared in Inc. Magazine, and many other major news sites. Harbor City Capital is the investment engine which fuels Responzive, and other digital marketing arbitrage ventures, as well as branching into acquiring and monetizing big data and data centers.

Via an exclusivee phone interview with Realty 411, JP broke the news that the firm is currently acquiring a high profile $100M retail domain, complete with its trademarks, and data on 15M active users. As of July 2017, the firm already had in excess of 1.2B data records in-house, and is generating 4/5M leads per day in different niches and verticals.

Opportunities for Accredited Investors

Harbor City Capital continues to grow quickly, and has just announced a unique opportunity for accredited investors to participate in its success. This is via a 506c filing and seeding funding round. Investors receive preferred shares via a convertible note, with a 5 year redemption period, offering a minimum of 17% returns. However, an IPO could be quite likely within the next 12 to 18 months.

Accredited investors are able to diversify their portfolios into this industry with a minimum of a $50k investment. Though the opportunity closes once the funding round hits $25M.

Summary

Investors are still hungry for yield, and there aren’t many places to find it these days. Digital marketing is one of the biggest and most vital industries today. Those that do it well stand to gain sizable market share, while others fade out. Digital marketing arbitrage and big data offer an exciting apex where these trends meet. One which could dwarf the returns and performance of many other business and investment models.

For more information about online leads for your business visit Responzive.com. Visit HarborCity.com and fill out the contact form for more details on the investment opportunity.

Following Up with Motivated Sellers Can Make You Millions

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By Kathy Kennebrook (The Marketing Magic Lady)

Let me ask you a question; are you properly managing your prospects? Are you taking the time to follow up with the sellers who didn’t initially accept your offers, or the sellers you still need to make offers to? Did you know that you are leaving thousands of dollars in potential income behind if you aren’t following up with sellers? One of the easiest ways to make a fortune in the real estate business and gain the advantage over your competition is to take the time to follow up with motivated and semi-motivated sellers. You’ve already got the seller in your pipeline, you’ve already done the marketing and spent the money to find this person, now all you need to do is to follow up with them until they either sell you their property or tell you to go away. How much simpler could it be?

There are two types of sellers we are going to follow up with, those we’ve already made offers to who haven’t accepted our offer and those who have not made any decision after our initial contact with them. Quite often, you will need to make multiple contacts with sellers before their situation changes and dictates that they sell their property to you. If you stay in touch with these sellers, you build credibility with them and when it comes time to sell they will contact you first, even if they have been contacted by someone else in the meantime.

There are a lot of investors in the market these days, and most of them have a very limited knowledge of how the whole follow-up process works, not to mention the inability to create successful deals. What they don’t realize is that many of the sellers you will be dealing with have a variety of problems they aren’t sure how to solve until they are contacted by you.

Some of those may include divorce situations, estates or health issues where there may be emotions tied to the property. With these sellers it may take a little longer before they make that final decision to sell. Most of your competitors will simply throw these potential deals in the trash when they don’t get the property under contract after the initial contact or offer is made. I have made deals many months after the initial contact with the seller was made simply because I took the time to follow up. Not only did I build credibility with the seller, but now they like me better and trust me more than the next investor who may come along.

These are the types of sellers I will place in my follow-up system and follow up with at least every thirty to sixty days if not more often. I have made thousands of dollars on deals other investors would simply have thrown in the trash because I took the time to follow up with a semi-motivated seller. Probably half of the deals I do in a typical year come from following up with these sellers.

In addition, with the help of a fellow investor who is also a software developer, I now have an incredible software system that does all the work for me. It reminds me when I need to do my direct mail campaigns, it reminds me when to follow up with sellers, it has a section to track potential buyers and build a buyer’s list, and it keeps all the information on the properties stored including a photo.

In fact, once I have followed up and purchased the property, my system will match the property with one of the buyers on my buyer’s list, so now; even that part of my business is automated. And once again, isn’t that the whole point to this business, to automate as many things as you can so you can work with the sellers and make the deals happen. You don’t need software to get started with this type of a system. You can simply use an auto-responder and a folder system to begin following up with motivated sellers.

Here is a recent example from my files- I contacted a seller who had inherited a property in Florida where I live and he lived in Michigan. The home belonged to his aunt who had pretty much raised him his whole life. When she passed away the home was left to him and he just couldn’t bring himself to sell it right away. I actually met with the seller and made an offer on the property. He had initially accepted my offer, and then he decided to hold onto the property for awhile and use it as a vacation home. After a year and a half, he got tired of having to deal with all the maintenance issues on the property and ended up selling the property to me for the initial offer I made because I took the time to follow up with him every thirty days or so.

I actually ended up making even more money on this deal than I would have in the first place because the house had appreciated in value during the period of time that he kept it and he had made improvements to the home. Most investors would have thrown this deal in the trash as soon as the seller said no to their initial offer, but because I took the time to follow up, I purchased the property and made a significant amount of money on this deal. I still get holiday cards from that seller.

I’m sure you’re already aware of how important it is to follow up with sellers. It only takes a few minutes each week to follow up with these sellers if you have a good follow-up system in place. I use my follow-up system to follow up with sellers I have made offers to but who haven’t said yes or no to my offer, and with sellers who own homes in areas where I want to buy. I do this by using both direct mail and e-mail to follow up with these sellers. Sometimes if the situation warrants it, I will call them. My system even reminds me to do the follow up. How much simpler can it be? AND…since the seller has already been getting contact from me for a few weeks, if their situation has changed they are ready to sell to me. This is a pretty typical scenario.

With sellers who specifically have properties in areas where I want to buy, I do repeat mailings to a specific list with specific parameters in mind such as out of state owners, quit claim deeds or old sale dates. Each time I do the mailings I continue to clean the list I am using by taking out bad addresses, deals I have purchased or folks who tell me not to mail to them again. The more I mail to these folks, the more credibility I build with them. If you are using a follow up system in your business it is very easy to track these mailings. This is an absolute marketing machine because not only are you doing deals day after day, you are constantly planting seeds for future deals.

If you take the time to follow up with motivated and semi-motivated sellers, you will make more deals and buy more properties with absolutely no competition for these properties whatsoever. It’s a win-win situation for you and the sellers.

For more information on following up with sellers, check out my website at www.marketingmagiclady.com. While you are there be sure and sign up for our free newsletter and get $149.00 in bonuses absolutely FREE.

Feeling a Little Lost? How to Get Your Groove Back

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By Sharon Vornholt

Do you ever feel a little lost? Like you just can’t get your groove back?

That’s not too surprising. The world is full of amazing opportunities. There are so many ways to make money in real estate investing, it’s easy for us to jump from one thing to another. Generally speaking, shiny object syndrome is not your friend when it comes to business.

However, know that you’re not expected to have it all figured out right out of the gate.

If you’re like most people, you will go down a lot of different paths before you figure out your investing strategy, and how to be your best and most authentic “you” and that’s OK. It’s all part of the process. When you’re finally in the place where you belong; the place that’s right for you, you will know it. That’s when you get your groove back, and you’re ready to rock and roll.

How to Get Your Groove Back

So how do you find the right balance between jumping from one thing to another while you’re finding your way, and staying on your predetermined path? (The path you decided was right for you.)

You slow down a look at the big picture as you begin the adventure of building a business.  This is a little like following a map to get from place A to B.   When we take a trip, we almost always take little side trips along the way.  When we look back when the trip is finished, there’s rarely any regret over these detours and unplanned stops.  It’s all part of the process in travel and in business, and it makes for a much more interesting trip when it’s all said and done.

Building a Business and a Brand that Stands Out

You’re probably wondering, “What does this have to do with building your business and your brand”? 

A lot more than you think. 

It’s important for your potential customers AKA motivated sellers, to see authenticity in your brand.  All of these little detours and side trips you make along the way while you’re growing your business, influence who you ultimately become. That person you become will be the face of your business going forward.

This is the time that the collection of experiences you had along the way begin to pay off. It’s also one of the ways you become different from your competition.

Be Bold

My advice to you is to be bold when it comes to chasing your dreams.  Take risks along the way.  Dare to be different.  Go out on a limb when you need to take a stand.

Remember the movie, “How Stella Got Her Groove Back”? Let’s just say Stella had to really go out on a limb to find it.  She had to get way out of her comfort zone.

What will happen when you do this, is you will start to build your tribe. People will be attracted to your authentic self. These are the people that will follow you along on your journey. They will be your best cheerleaders, and they will refer people to your business.

Remember, you won’t be a fit for everybody.

This confidence you’ve gained will shine through when you talk to motivated sellers, and people will trust you to help them get where they need to be. They will feel confident that you are the one to help them with their problem.  When you can’t seem get your groove back, it’s almost always because you aren’t being your authentic self.

I love this line from the book Fascinate by Sally Hogshead.

“Different is better than better”. – Sally Hogshead.

Dare to be different.

How Will You Be Remembered?

According to Brendan Burchard, there are only 3 things anyone will ultimately be remembered for:

Character, relationships and contribution, so let’s talk about these a little bit.

Character

There is little to say about character that hasn’t already been sad a million times.  Your character will determine your long term failure or success in this business. You will be quickly found out if you’re not an ethical business person. You will become invisible to people that should be part of your tribe.

Relationships

Real estate is a relationship business. Whether we are taking about other investors, contractors or motivated sellers, this business is all about relationships. It’s about having conversations that build rapport with people you do business with.

If you’re one of those folks that struggle with this particular thing, contrary to what you may believe, this is something that you can get better at with practice.  Full disclosure here: you’re going to need to be prepared to spend a lot of time outside your comfort zone in the beginning.

Contribution

When I think about contribution I immediately think about giving back. How can we make the world a better place? There are so many ways.

  • We can do volunteer work for someone like Habitat for Humanity or other charity
  • I know an investor that wrote a book and donated the proceeds to charity
  • If you are a rehabber, maybe your mission is to revitalize neighborhoods
  • How about sharing your expertise with others?

Contribution isn’t just about money.  It’s finding a way to leave the world a better place when you’re gone.  It’s how you will be remembered, and it’s up to you to decide how you will be remembered.

Giving back could be as simple as mentoring folks just getting started in this business. Be bold, get involved, take a stand and get your groove back in the process!

 

Steve Bighaus: Leveraging Technology to Improve Investor Lending

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By Anita Cooper Investing in property can be frustrating, especially when you’re always searching for good financing options that suit where you’re at as an investor.
Having someone in your corner to provide quality information and advice can help you reach your goals more quickly than going it alone.
As founder of Team Bighaus, Steve’s clients know they can count on him when they need to finance a new opportunity…even when that opportunity is their own place of residence! Steve has a vested interest in property investors’ success…it’s why he does what he does. His number one goal is to become the all-in-one resource for property investors. But as a forward thinking kind of guy, Steve is always on the lookout for ways he can improve his processes to get better results for his clients. One such process is technology…using it efficiently and effectively. techsmall That’s why, after speaking with thirty to forty companies, Steve settled on working with Sierra Pacific Mortgage Company. They understand his goals as a specialist in lending to investors, and they share his vision of using technology to deliver exceptional products for his customers. One exciting development is the creation of a new loan origination system that will allow a borrower’s information to be obtained straight from the source. This will simplify the process for both investors and homeowners and expedite the loan origination process. One particular issue that many fix and flip investors are facing is the challenge of finding eligible buyers for their properties. Steve’s research has found that these investors are experiencing a dismal fall-out rate of 40 to 50 percent! As part of his goal to be a full service company for investors, Steve and his team aspire to preclude any potential problems as early in the process as possible. Using all of the tools at their disposal, they provide quality pre-approval letters towards the goal of improving results for investors. goalsmall Other tools at Steve’s disposal include an automated system for appraisals that will let the lender know whether or not an appraisal is needed, and a great customer relationship system. And as any of Steve’s customers will tell you, Team Bighaus is known for their stellar customer service. Whether you leave a voice message, drop an email or send a fax, you will receive a response the same day. Need a prequal letter and it’s the weekend? Just call Steve…he’ll take care of it. If you were to sit down with Steve he’d tell you to think of him as your banker – someone you can count on to be in your corner. Bottom line, while pricing is important, there’s something Steve and his team can offer that few can…responsive customer service paired with innovative technology to create exceptional products to help investors grow their wealth.  

7 Bookkeeping Mistakes That Real Estate Business Owners Make and How to Avoid Them

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By Leon McKenzie, CEO, US Probate Leads

How would you feel if you had to watch as your hard-earned wealth goes up in flames because you failed to make sure that your finances were in order?

The word horrible comes to mind.

Statistics show that about 49% of small businesses will not be able to survive for 5 years or more. So, if this is a fate that you want to avoid as a real estate investor, your bookkeeping must be in order.

And while you have the option of hiring a bookkeeper to sort out your business finances, you still need to take an active role in managing them. You could start by identifying the common mistakes small businesses make and do everything you can to avoid or rectify them.

So, what are these mistakes? And how should you go about addressing them?

1. Using a Personal Account for Business Transactions

A personal bank account is for personal financial transactions. This is the account that allows you to pay your personal expenses and keep your savings. But many small business owners, which include those in the real estate, tend to use personal bank accounts for business transactions.

This is a big no-no.

At no point in time should you do such a thing. How are you going to trace what is coming in from your business? And how will you be able to separate your personal and business transactions?

Mixing things up in this manner is a recipe for trouble. Sooner or later, the IRS may require you to account for all monies coming into your real estate business, and you will be unable to meet their requirements – at least not without some expensive accounting help.

If you are currently running your business and personal life from one bank account, you need to do something to change that. Opening a business account takes a short time but will save you a lot of grief in the long term.

2. Paying For Business Transactions Using Personal Debit and Credit Cards

Are you one of those real estate investors that use your personal debt and credit cards to pay for business transactions?

You need to stop.

Doing this is just as bad as using a personal bank account to run your business operations. It’s going to be very difficult for you to keep track of your personal and business expenditures. You will need to spend more time and effort to find out what belongs where, which you may not be able to do.

So, what should you do?

It’s really simple: get separate debit and credit cards for your businesses. And if you are not in a position to do so, then dedicate one debit or credit card to business transactions for easy accounting. Doing so helps you build creditworthiness not just on a personal level, but on a business level as well.

3. Poor Record Keeping

Are you one of those people who assume that when the time comes to do your taxes you will remember it all?

How is that working out for you?

Poor record keeping is a serious issue for some real estate investors. You may fail to keep receipts of the building or renovation materials that you use. You may also fail to keep a record of your debts or payments to freelance professionals that you hire. Categorizing employees or expenses wrongly may also be an issue. Regardless of what the problem is, poor record keeping will come back to haunt you in the very near future – when the taxes come calling.

The first thing to do is write down everything you spend in the way of business transactions. Use a business credit or debit card to pay off your expenses because it makes everything much easier to track. Be sure to ask for a receipt – always. Then make sure that you have categorized your business transactions and employee-related expenses correctly. In addition, keep a very close eye on what is coming in and going out of your business accounts. Be sure to keep a record of your business activities going back a few years, just in case.

It may seem like a nuisance to keep good records, but when you need to account for your money to IRS or potential business buyers, you will thank yourself for doing so. Not only will you be able to stay out of trouble, but you will also be able to stay on top of reimbursable expenses that will help keep more money in your pocket.

4. Not Reconciling Your Bank And Credit Accounts

If you have a good record of your business transactions but do not reconcile your bank and credit accounts, then there is no difference between you and hoarders who buys things that they do not use.

What’s the point?

Those receipts and statements you keep should be used to reconcile your credit and bank accounts. It is the only way for you to get a clear picture of your real estate business in terms of what you owe and how much you really own as equity and cash.

So take time every week or month to balance the books. Don’t procrastinate until it is too late to save your business.

5. Setting Little Money Aside For Taxes And Other Bills

Are you setting very little money for taxes?

That’s probably the reason you get penalized often.

How about a steady cash flow: are you always short of cash to run your business?

If you run a real estate business, then you are self-employed. That means that you are responsible for setting aside enough money aside to pay your taxes and any other financial emergencies that crop up. We are talking about Social Security, Medicare, and retirement savings for the future.

Your poor cash flow on the other hand, could be attributed to poor accounting or the fact that you are overextending yourself financially. If you are spending most of your business revenues on expanding your business without keeping a financial emergency fund for the business, then between your regular business expenses and debts, you will have little money for emergencies – hence the poor cash flow.

So take stock of your finances, and leverage debt to help you expand that real estate business without compromising your ability to pay taxes or keep the business in operation.

Cash is still king.

6. Not Backing Up Data

After all the effort you have gone into to digitize your business and learn how everything works, you are currently sitting tight and have no care in the world.

This is a dangerous mindset to have.

Digitization of business data makes taking care of your real estate investments much easier. But what happens when your systems are hacked or your servers fail?

You will need to resort to your backups, of course.

So, the question is: do you back up data? How often do you do it?

What are you waiting for?

You need to back up your data digitally and manually. You can back up your real estate business data in the cloud or a second business server. You should also keep your paper records as a backup just in case your entire digital system fails completely.

You can set up your digital system to back up data automatically after a set period. That, in addition to keeping a paper record of your business transactions, will be helpful should your business ever need an audit or should your systems fail.

7. Trying To Do It All

Nobody understands your real estate business better than you do. You have put blood, sweat, and tears into running it and making it a success. For that reason, you are having a hard time ceding the control of your business to someone else. So you try to do it all. And you are failing- miserably.

“Pride comes before a fall.” How often have you heard that statement?

Is it more important for you to be in control or to be successful?

Well then, it is time for you to try to keep up with every aspect of your business. While it is wise for you to keep up with your business finances, it does not hurt to hire a bookkeeper to help you out. Not everyone has a head for numbers, and it is okay to hire those that do.

And when you do hire a bookkeeper to help you with your business finances, supervise but do not micromanage. Take the time to discuss what you want that professional to do, and then provide him or her with the chance to do the assigned job properly.

Business bookkeeping is part and parcel of running a real estate business. In order for you to make money, what comes in must be more than what goes out. And in order to make good profits, you have to understand what goes on in your business, right? So, it all comes a full circle. What this implies is that you must know what goes on in your business on the financial front. Be sure to hire a professional bookkeeper to help you out if you cannot manage your business finances. But even as you do, make work easier on yourself by avoiding the common bookkeeping mistakes that business owners tend to make. It will make your business operations much more efficient and profitable.

The Number 1 Risk for Real Estate Investors Now

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By Fuquan Bilal

What’s the top risk that investors in real estate are facing today?

There is still a lot of opportunity out there. There are great deals to be made. Yet, it is also true that it is taking more attention to detail and effort to find the really profitable deals. Market well, in addition to buying, structuring, and managing right, and you’ll be okay if you have good deal sources. However, there’s real risk.

The number one risk in the real estate market today is that 90% of investors have no plan for sustainability. None. Some may not even know what that means if you ask them.

The vast majority of real estate agents and investors in the market now are very green. They’ve only experienced the business during the great bull run we’ve had since 2008 and 2011. Honestly, while I’d like to say I’m pretty smart or talented, the truth is that you couldn’t really not make money in real estate for the past 10 years. It’s been so ridiculously easy. Anyone could do it, and they have.

That’s great for them. I love to see people succeed. There are a lot of guys and gals who have gotten into real estate in the last few years and haven’t only flipped houses themselves, but have been building spec homes, doing Airbnb, amassing a few hundred rental units, and then either offering turnkey properties or teaching others as newly minted gurus.

Some of these people really do know their stuff, but most have just been riding on luck. Worse, they either don’t believe a correction is coming, keep saying we’ve got another 12 to 18 months (which they’ve been saying for more than 18 months), or are seriously minimizing how impactful the next correction will be.

Here’s the real problem. They have no plan to hold things together when the market corrects, and if you’ve been watching the data, some markets are clearly correcting already, and have been for over a year. So, many are paying too much for properties, are basing their values and business models on rents and a resale market that isn’t there, and don’t have the reserves to survive a temporary crunch. They owe too much, and are only a month or a few away from going bankrupt if cash flow tightens up.

Now, it’s no secret that you can both make money at the top of the market, and that our most famous billionaire investors are those who made their wealth when everyone else thought the market was at its ugliest. The difference is in being prepared and pricing things right.

What can investors do to beat this risk?

  1. Before investing with anyone, ask what plan they have for sustainability
  2. Know your real estate and economic cycles (history repeats itself)
  3. Stay in tune with the market data, and what’s really happening out there
  4. Know the value before you invest
  5. Look for value, don’t speculate

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

The 3 Things Investors Need Most in 2019

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By Fuquan Bilal

Do you have the three things you need most out of your investing for this year and beyond?

Many are finding it hard to make sense of the market right now. The media headlines proclaim the economy is awesome and supercharged with growth and low unemployment. Yet, the hard data and other signals suggest there are some corrections in the works. The bottom line though, is that you need these three things to get you through.

1. Passive Income

Time is the most precious and scarce resource we have. The only way to really get more time is with passive income. We can only become so productive. Then it is up to passive investments to make money so we can spend more time on other things. That’s true whether you are already making millions a year, or are in a high paying career, but are still trading your time for a wage. This is going to be even more critical over the next couple of years. And it doesn’t matter whether or not you own rentals right now, or you think your company is well insulated from a recession. If you’re not getting truly passive income, then it may be time to consider a fund or other vehicle.

2. Downside Protection

Who knows, we may really be in the best economy ever, and real estate prices, stock values and incomes might just keep going up. Of course, the odds are that there is some type of temporary correction in the works. That means it’s just smart to have some tangible, underlying hard assets and to be overcollateralized in order to protect wealth and capital during the months and years ahead.

3. Stable Performance

No single asset is going to perfectly and consistently perform the same forever. And it’s those fluctuations that are really tricky and usually come at the worst times. By diversifying and harnessing great management, we can keep our total portfolio performance steady, and yet without being so over-conservative that we end up with negative yields.

We believe we’ve achieved all this, and the ability to future proof your portfolio through our hybrid fund. Check out how we’re doing it today…

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

When You Can’t Find Real Estate Leads, Look to Probate!

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By Leon McKenzie

The real estate industry is changing. With more and more competition in the marketplace, challenges in getting a loan and cautious homeowners staying put, it can be nearly impossible to find property that you might be interested in purchasing for your real estate portfolio. Is there a solution? Is there a way to combat the real estate lead shortage that has permeated virtually the entire industry and has stalled your efforts at investing?

What new and experienced real estate investors are seeing in the market is a fundamental change that may last for the foreseeable future. Overall, the nation is experiencing a shortage in the amount of properties that are being put on the market, leading to a lack of leads. This is creating increased pricing on homes that are for sale and issues in trying to build and acquire a real estate portfolio.

Why a Shortage in Real Estate?

The shortage in real estate leads that is occurring in most areas of the United States is due to issues in the lending industry that started several years ago and that continue today. With it becoming more and more difficult to qualify for a mortgage, homeowners are holding onto their homes instead of buying and moving because they have no other option. Homeowners that want to expand their homes are simply adding on or remodeling to avoid the issues with lenders and the hassles in moving. This is leading to a painful shortage in the real estate market. The Philadelphia Inquirer agrees, “. . . Some observers believe they are seeing the emerging signs of a housing shortage. . . Predicting how much housing is needed involves a complex calculus that weighs hard statistics (new-home starts, sales of previously owned homes) against a certain amount of demographic tea-leaf reading (household-formation forecasts). Thus, there isn’t complete consensus on what will be enough.”[1]

As mentioned, while the overall interest rate is the lowest it has been in years, there are few people with good enough credit to purchase a home. When someone does decide to sell their home it is usually because they have to move for a job relocation or for another pressing matter, such as medical treatment or because they need to downsize – or they are in the enviable position of having good enough credit that they were able to secure a preapproval on a new loan to purchase a bigger home.

How does this create a shortage? Since lending is tight, fewer people can afford to put their homes on the market. That means that the availability of homes has decreased. To add to the shortfall, the slow economy has led to a construction slowdown, which means that fewer homes are being built to accommodate new communities and homes that are being torn down. Overall, this has led to a painful real estate shortage for much of the nation. The Sacramento Business Journal reported that, “One analysis of the region’s housing market thinks there’s just not enough for sale. Again. A shortage of inventory is driving everything in the residential market from pricing to rental affordability, according to Zillow. One reason for that is a lingering hangover for the building industry from the housing bust of the last decade, said Svenja Gudell, senior director of research with Zillow. Though the economy began to recover three years ago, housing construction is still lagging, she said. In 2012 and 2013, only 159 new home permits were issued for every 1,000 new residents, according to Zillow.”[2]

The overall lack of new homes available and the persistent challenge in getting a loan is creating issues for investors as they try to navigate few options and high prices.

Housing Shortage Equals Inflated Prices

Most economists will tell you that the biggest drivers in the market are supply and demand. As you can imagine, decreased supply in the housing market means that pricing has skyrocketed, something that real estate investors simply cannot afford when they are looking for business opportunities. The Sacramento Business Journal reported that, “For both renters and homeowners, Sacramento is now defined by Zillow as one of the 10 least affordable metro areas in the country. Mortgage payments here take up 26 percent of income, compared to 15.3 percent nationally. Though the percentage is lower than Sacramento’s historic mortgage payment percentage of 29.5 percent, Zillow noted buyers at the moment also tend to have lower median incomes.”[3]

These historically high prices mean that people who are making less money have to spend more of the income that they do have on a home. Realtor Magazine reported on the decreased inventory across the country and the increased prices, saying, “The inventory of existing homes is at its lowest level in seven years, while newly constructed home inventory has hit a 50-year low mark. Falling inventory is causing home prices to shoot up higher and faster than most analysts anticipated. The national median price of transacted homes was up 9.5 percent in August. Other price measures, like Case-Shiller and the Federal Housing Finance Agency price index, which look at price changes in sales of the same properties over time, have been rising as well, at double-digit annualized rates in recent months. Of course, not all markets are this robust. Phoenix is looking to notch a 25 percent gain for the year, while Chicago is just emerging from negative territory.”[4]

Surviving the Shortage as a Real Estate Investor through Probates

If you are interested in continuing to work in real estate, then you know something has to change. Real estate investors have a limited amount of options when facing a market like this. Some investors have simply moved on to other business opportunities, while others have succumbed to the increased prices, which have hurt their business and their balance sheets. But, there is a segment of real estate investors who have found a profitable way to deal with the challenges of the housing shortage by finding a new source of leads.

While many investors are only looking at the traditional segments of the market – single family, residential homes that are for sale by families who want to upgrade that are listed on the traditional MLS-style forums – there are other homes on the market that can be purchased at a significant discount. Properties owned as part of a probate are widely available and can be purchased for well less than comparable homes in the area. In fact, there are an estimated 100,000 probates entering the market each and every month throughout the United States.

Probate properties are those homes, apartments, multi-family homes and commercial sites that were previously owned by an individual who has passed. The local court then appoints an Executor to ensure that these homes and other properties are sold to take care of paying medical bills, funeral fees and other obligations.

Probates Provide Motivated Sellers

Once you start working in probates you will understand why Executors are motivated to sell their properties quickly and for a substantial – 30 percent to 50 percent off – of current market values. Each Executor is responsible to the court to ensure that the assets of the individual who has passed have been liquidated in order to meet financial obligations and provide an inheritance to the individuals left in the family.

Executors not only feel the pressure to sell because of the court, but they want to sell because of their own convenience. While some Executors can be a family attorney or an accountant, many times the Executor is a family member who has responsibilities of their own. They may even live out of state, and making repeated trips to show a home or apartment building can be nothing short of challenging. Executors also understand that, in addition to time constraints, the home their family member owned may not be fully updated. All of these conditions provide the opportunity for homes and other properties to be purchased for a fraction of the current market value.

Finding Probate Leads

Now that you understand the value of having access to probate properties in this challenging economy, you may be wondering how to get access to them. Many individuals who are starting a probate business decide that going to the local courthouse is the best way to look for opportunities in their area. This can take time, as you need to allow for travel to and from the courthouse as well as time evaluating filings to see if there are holdings within the probate appropriate for your business. As you can imagine, this can take away valuable time from your growing investment business, your family and the job you currently hold.

There is a better way. By using a professional probate lead service you can have up-to-date information and leads delivered right to your inbox on a weekly basis. With no more trips to the courthouse, no time wasted looking at complex filings that are hard to understand, you will have more time to go out and evaluate properties and opportunities. Unlike traditional leads in the current real estate market which can be nearly impossible to find and create the environment for high pricing, there are literally thousands of options for probate purchases each and every day.

Build a Vibrant Real Estate Investment Business with Probates

Having access to leads on a regular basis means that you will be able to find success in probate real estate investing. With time, patience and a carefully thought out business plan, you can be sure that having these leads will make an enormous difference in your ability to purchase homes and other properties as well as acquire them at a favorable price.

Probates are not limited to residential real estate, either. What you will find is that you can expand your investments to include apartment buildings, multi-family units, businesses, vacation homes and even purchase and resell personal property, including antiques, artwork and vehicles. The variety and opportunity with probates is endless because there is always a supply of leads available.

The Most Reliable Source

Are you looking for a reliable lead source for all of your probate investment needs? The experts at US Probate Leads offer the highest quality leads available on the market today. Our certified lead specialists visit every courthouse in the United States, constantly evaluating new probate filings and making those available to our investors. In addition to our premium lead service, we also offer services that can keep you informed on the newest trends in the market. Contact our office today to learn more about our lead service, monthly newsletter, e-books, seminars, webinars and even our individualized mentoring program. Contact us today to speak to one of our friendly, knowledgeable customer service representatives.

 

Sources:

[1] http://www.matrixrealestate.com/about-matrix/market-news/slowing-construction-could-lead-housing-shortage-experts-say

[2] http://www.bizjournals.com/sacramento/news/2015/03/30/inventory-shortage-is-hurting-sacramentos.html

[3] http://www.bizjournals.com/sacramento/news/2015/03/30/inventory-shortage-is-hurting-sacramentos.html

[4] http://realtormag.realtor.org/news-and-commentary/economy/article/2012/11/seeds-housing-shortage

 

Why You Need to Create a Customer Plan for Your REI Business

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By Sharon Vornholt

Today I want to talk about why you need to create a customer plan for your real estate investing business (in addition to a marketing plan) and exactly what a customer plan is. This is a new concept for real estate investors, but it’s something savvy businesses have been doing for a while.

What’s the Difference Between a Marketing Plan and a Customer Plan?

Simply put, a marketing plan is used to get leads. It’s used to attract motivated sellers.

Your customer plan details your process or what you do to keep those leads. The goal should be to have a repeatable process for nurturing the people that come into your business as leads.

Let’s Look At Your Marketing Plan

One of the first things you probably learned when you started your investing business was that your #1 job is marketing. You won’t be in business very long if you don’t have a steady stream of leads coming in the door. There are a lot of things you can put off but marketing isn’t one of them.

In order to effectively market your real estate business so that you always have leads, you must have a marketing plan.

Once you have implemented your marketing plan, it’s time to move on to your customer plan.

Exactly What Is a Customer Plan and Why Do You Need One?

A customer plan is a document that you create for your specific business. The customer plan for a real estate business would look much different than one a doctor created for their medical practice.

If you look at most businesses, they spend a lot of time writing business plans and marketing plans that attract customers. However, almost no one has a plan for keeping those customers (AKA motivated sellers) once you have gotten them to call you. Real estate is no different from any other business; it’s all about the customer. In our business they just happen to be folks that want or need to sell a property.

Your customer plan should be a detailed document that outlines everything needed to create a remarkable customer experience. This is the time for innovation; the time to think outside the box. If you really want to be the standout company in your marketplace, you need to find a way to reinvent the way you do business and deliver that exceptional customer experience.

Once you have created your customer plan, it also serves as a roadmap for making your company the absolute best company in your market.

Companies that got it Right

When you talk about companies that disrupted their markets, the first two companies that immediately come to mind are Uber and Airbnb. These companies “reimagined” the taxi business and the hotel business.

Uber changed the model of taxi business forever. People everywhere like riding in a regular automobile much more than a stinky taxi. Airbnb is another company that completely changed the customer experience. They reinvented the way customers choose accommodations when they travel. They are definitely giving hotels a run for their money.

What about cameras and voice recorders? Smart phones have pretty much replaced the need for both of these devices. They forever changed the way we take pictures on the go.

When I think back to the company that changed the way real estate commissions were traditionally paid, RE/MAX was responsible for that major change. Agents no longer had to share their commissions with the broker/office. If you are a RE/MAX agent, you pay a fee for everything; office space, copies etc. but you don’t share your commission. They reimagined the way Realtors get paid.

So the next question is …. how can you create a customer experience that is so different than what people are used to that you become “the one” they all want to work with?

It All Starts with the Customer

The first step is to know your potential customers. Don’t worry about your competition; worry about your customers. Once you know who your ideal customer is, then it’s time to create the best customer experience possible. Focus on creating the experience and the rest will take care of itself.

Of course ultimately this is about getting the deal. But more than that, it’s about creating raving fans that result in referrals, testimonials and repeat business.

Nurturing Your Leads

It’s easier (and cheaper) to nurture a lead than get another one. That’s a fact. Now don’t mistake this for trying to make a deal work that really isn’t a deal. That’s not what I’m talking about. This is about creating an experience for the seller at every touch point that is remarkable.

Anatomy of the Average Real Estate Deal

This is a very basic overview of the way a real estate deal goes from start to finish.

  1. You spend a lot of time and money generating leads
  2. Your marketing results in the seller contacting you about the property
  3. At some point you will have a phone conversation with the seller
  4. The next step is to look at the property if the initial screening call went well
  5. You inspect the property and decide whether or not to make an offer on the property
  6. After negotiations that offer is accepted or rejected
  7. If the offer is accepted you will proceed to the closing/settlement (and get a testimonial)

If you look at the process it’s all pretty mundane. Ask yourself this; looking at these steps, is there anything there that would create a remarkable customer experience? I don’t think so.

So let me ask you this:

  • If nothing were off limits, what could you do?
  • What would you change?
  • Is there a way to “reinvent” the way this process evolves?
  • Where can you innovate?

Let’s Do a Little Brainstorming Here

Let’s start with #1 which is lead generation and look at how you might reinvent the direct mail process.

If everyone is sending the same direct mail pieces; letters and postcards, what can you do differently? How about sending out a newsletter with helpful homeowner tips as your first mail piece? Instead of starting with a letter or postcard that says “I want to buy your house”, you begin your relationship with “Hi I’m Sharon, and I have some helpful tips for you today”. The point is to make a different first impression than everyone else.

Think of it this way; send the sellers something they will enjoy reading and in the process they will be introduced to you as a person rather than a business that wants something from them (their house). By doing this, over time you become the trusted resource in your market. At the bottom of your newsletter let them know that you buy houses and share your contact information.

Taking this thought one step further, why not replace one letter or postcard every quarter with something that would be useful to the sellers like a quarterly newsletter or market update? Information to create these information pieces is readily available on the internet, so it’s really pretty easy.

Doesn’t that make a whole different impression than a “we buy houses” letter or a postcard that’s all about you and your company? You bet it does.

Final Tips

I would like to challenge you to look at each one of those steps in the average real estate deal and think of a way you can “reimagine” the way you do business. Find ways that you can be remarkable in this crowded marketplace of real estate investing.

 

Sharon Vornholt

Louisville Gals Real Estate Blog

Social Media Marketing Statistics and What They Mean For Real Estate Businesses

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By Leon McKenzie, CEO, US Probate Leads

Did you know that there are a total of 2.789 billion social media users in the world? Did you also know that 81% of all Americans have a social media profile currently?

Impressive, isn’t it?

It is precisely because of the popularity of social media that you should incorporate this platform within your marketing campaign.

If you don’t, you are going to lose a lot of potential customers and home sellers who would otherwise have helped boost your business.

But before you make a foray into social media, here are some social media statistics and their implications that you would do well to pay attention to:

  1. 21% of For Sale by Owner Homes (FSBO) Will Be Marketed Via Friends, Relatives, and Neighbors

According to the National Association of REALTORS™, FSBOs accounted for at least 8% of all home sales by 2015. What is significant is the fact that many of these homeowners looking to sell will use their friends, relatives, and neighbors as mouthpieces to market their properties.

What These Numbers Imply:

Many of the people who will help a homeowner sell a home not only have offline relationships, but online ones as well. That means that they will talk about the homes that are available for sale with people in their social networks.

Considering the fact that 51% of home buyers find their homes via the internet, you cannot afford to underestimate the value of social media in your business. Where do you think they will go to ask for recommendations from when they decide to purchase a home? And who do you think will be in a good position to let them know about an available property?

To put it simply, if you do not have social media accounts, you face losing up to 51% of your potential client base. And that means you will struggle to sell any homes you invested in when the time is right.

Without social media platforms, you also stand to lose real estate leads that would otherwise have helped you get that property that you have always wanted.

  1. 88% of First Time Buyers Will Purchase A Home through an Agent, and Yet Only 9% of Realtors Use Social Media to Market Their Listings

Most first time home buyers are not willing to search for a home on their own. And yet despite the high demand for agency services, many realtors do not even bother to market their listings via social media.

What These Numbers Imply:

You would do well to offer your services as a real estate agent to first time home buyers. You can do this by placing ads on social media platforms like Facebook.

However, unlike most realtors, do not fear to market your listings via social media. You can choose to promote your listings once a week. During this time, you should ensure that you list all the homes that you have available for purchase and write a short description of each of them. If you do not promote your business in this manner every day, it is highly doubtful that your audience will get tired of it. Just politely ask people to share and then sit back and watch the power of referral marketing in play.

If you have invested time providing value to your audience in other ways, the results of marketing your listings on social media will be positive within a short time.

  1. 72% of Online Users are Facebook Users

It is not surprising to see such a high number of users online make use of Facebook in their daily lives. This is by far the biggest social media platform available today. Statistics show that Facebook has at least 1.968 billion users worldwide!

What These Numbers Imply:

It does not matter whether you are in the business of buying homes or selling them. If you want to reach the widest target market available anywhere online, you cannot afford to ignore Facebook.

You could promote your business by marketing your listings on a regular basis. But before you do that, ensure that you provide value to your audience. This can be done through:

  • Short but informative social media posts
  • Regular Q & A sessions that allow you to educate your audience on various real estate issues like renovations, real estate business operations, staging, what to look for when buying a home etc.
  • Live and on-demand webinars that allow people to learn more about the real estate industry.

The beauty of it all is that Facebook will enable you to do all these things on one platform.

  1. Visual Content Is 4000% More Likely To Be Shared On Social Media Compared To Any Other Type of Content

No matter which way you look at it, social media posts are more likely to be shared far and wide if you incorporate visual content within them.

What These Numbers Imply:

If you have a social media account, and your marketing efforts are not bearing fruit, it is time to analyze whether you have taken the time to include images.

Consider using high-quality detailed images of any listings you choose to market on social media. Incorporate infographics to not only increase the chances of your content being shared, but to also improve your online visibility and reputation.

Infographics can be based on reputable statistics about what is going on in your little corner of the real estate industry. For example, if you are a probate real estate investor, consider finding links that prove the benefits of probate properties for home buyers. Considering that over half of home buyers will find homes to buy online, an infographic showing the benefits of buying certain types of homes may be the ultimate determinant on what home they end up purchasing. And all those people on social media may help drive a huge amount of traffic to your site.

  1. 51% of Home Shoppers Read General Home Information on Mobile Devices

Social media is great for interaction with potential and existing clients. It is also wonderful for referral marketing. And eventually, many of the people who see the links you share on your social media page will show up on your business website – assuming that you have one.

What These Numbers Imply:

When you have half of home shoppers reading general home information via their mobile devices, it makes the nature of your website even more important.

Perhaps the first question should be: do you have a website? If not, what are you waiting for?

The second question is: is your site optimized for mobile users? If the answer is no, then you need to get moving to rectify the matter. According to We Are Social 2017 Global Overview Report on social media, there are 2.547 billion mobile social media users. It is for this reason that you need to move quickly to optimize your website for mobile device users.

If you don’t rectify the issue of mobile site optimization, expect Google penalties to apply. This means that you will experience lower online visibility and ultimately, a lower amount of traffic.

And if you want to boost your real estate business, then not having a good website is counterproductive even if you spend time promoting your brand on social media. You are going to lose a lot of potential customers who would have wanted to learn more about your properties. Is that what you want?

  1. 84% of CEOs and VPs Say They Use Social Media When Making Purchasing Decisions

The number of company decision makers that make use of social media in order to come to a decision regarding what to purchase or how to proceed is quite significant.

What These Numbers Imply:

You cannot ignore the role of social media marketing when it comes to influencing decision makers. Suppose you have commercial properties that you would like to sell?

In order to appeal to the people at the top, you need to set yourself as an authority that VPs and CEOs can trust. And yet despite how effective social platforms can be for this purpose, only 27% of top companies say that their C-Level Executives are actively involved in social media.

If you want to stay ahead of the game, do what your competitors are not doing: use social media to elevate your real estate brand. Post long-form content on social media sites like LinkedIn and share your expertise on platforms like Facebook. Make sure that images of your properties appear on Instagram and Pinterest.

The more people you attract with your content, the higher the likelihood that you will attract the attention of decision makers as well. So when it is time for you to sell that commercial property to bring in the money, you are going to find a large audience that is willing to recommend your property to as many people as possible. In addition, you may just find the right buyer without much effort.

It takes work to market your real estate business on social media. But you know what? This type of internet marketing platform is free at the basic level, offers you the chance to appeal to a larger audience, and enables you to cultivate a good relationship with your potential and existing customers. All these things make it much cheaper and much easier for you to find and good properties that have a higher chance of getting sold easily when the time is right. It is therefore in your best interest to use social media to make a difference in your real estate business. What are you waiting for? Get started today!