FSBO Market. Nothing but Undercover Realtors and Wholesalers??

Question

Ugh! Lead Famine! Has this ever happened to you? 
Where you recently had a few failed direct marketing campaigns drain funds and no one is calling on flyers/classified ads anymore?  And you look up to find you have no more marketing money?

Well it happened to me just now and I'm part timing this while in college so that hurt my pockets, So my brilliant next move was to start calling aged/seasoned Online FSBO ads of about 30 days, calling on homes from Craigslist/Owners.com/Forsalebyowner.com and other sites like that.

After calling 3 ads or so a day for a week,  I find it troubling that every call I made, with the exception of 1 ad, was either a wholesaler or a RE Agent. That's about 21 to 30 calls to find one lead.

Many people would find that that's not enough info to make a credible observation in a market, but most FSBO websites aggregate listings from each other so it's not like I have many leads to call after sifting through duplicates.

Some may be thinking network, and I will add that I didn't have a good experience partnering with other wholesalers in my area (Baltimore, MD) so I stopped and I haven't a clue on how to navigate and co-op with agents as a wholesaler, as I don't want to get too competitive with foreclosures yet.

So from that I pose a question, In your opinon is it worth going after FSBO's anymore? If you are doing well with this lead source, I would love to hear from you on your thoughts and what are you doing to find "legit" owners.

Karen Margrave · Answer

I HATE when agents run ads on CL and other places as if they are FSBO's. I am a licensed agent, and it's so irritating when people are obviously not interested in dealing with an agent, and the agents flood all the ads with their landing pages to build their buyers lists, or advertise Foreclosures they don't have. It's so RUDE! who would ever want to do business with them? They use programs that automatically place the ads for them or ?

In many areas, CL is becoming irrelevant as a source for real estate listings, you'd think they'd enforce the rules better.

Don Konipol · Answer

I think most wholesalers tend top underestimate required marketing budget by quite a bit.  some make it up by doing a lot of unpaid grunt work like driving neighborhoods, attending investor shows, meetings and conferences, etc.  However, to have a steady deal flow in any competitive business, it is important to have a sustained marketing program.  When our marketing program depends almost entirely on personal effort, we neglect marketing when we are working actual deals.  This comes back to haunt us later when the deal flow dries up.

I believe a good sustainable marketing program will contain some or most or even all of these features:

1. Attendance of at least 8 meeting/networking events (real estate investment club, Realtor meetups, etc. ) per month
2. Presence on the web with a website that is being SEO optimized for specific category
3. Listing with various websites in appropriate category.
4. Active participation on online social networking on BiggerPockets and LinkedIn
5. Ads in publications and online or otherwise
6. Targeted mailings and/or fliers and/or signs
7. Development of referral sources such as accountants, lawyers, insurance agents, etc.

Anything additional I missed?

David Niles · Answer

Karen M.  Couldnt agree more,  you can flag them and alot of the time craigslist removes them, but they just flood them all right back up the next day. They are completely destroying what CL is about.

Delondon Dear · Answer

have you tried investing in bandit signs? make some up on your own, very cheap and if you can get them to stay up for a while you will get a worth while return on them. Route the calls to a google voice or other anonymous line so that the sign police one bug you, thats if they are illegal in your town.

Roc P. · Answer

Jerome, your best bet to find a FSBO, is to drive your target area and look for the FSBO signs that are from Home Depot etc. roc

Con Fisher · Answer

What about getting a list of expired listings? It's free and clearly some or all of them were unable to sell. Might be some motivation there.

Jermon Clayborn · Answer

Yeah Jerome I feel your pain. Agree with everyone on this board. Go back through your old leads. Also try driving around different parts of the city...

Jerome Harrod II · Answer

Jon Klaus & Nathan Paisley 
Great idea, Yeah I will try contacting them, I'am using Listsource to target maryland absentee owners that own 75% to 100% of 
equity in their homes, as well as what Don Konipol suggested in his post about driving neighborhoods. From what else he suggested it seems I have a lot more to learn about marketing as a wholesaler or investor period. Awesome stuff.

Mark H.
I had no idea of those rules nor know that I could complain about that. I could very much look into that to help try to clean up these listings a bit.

Mark H. · Answer

Well, every state is certainly different, but in my state, "secret agents" can and will be taken down by the real-estate board.  Blind ads can be proven & verified by the board fairly easily,  and the "enforcers" are often other agents dropping a dime on the competition that is skirting the rules.  The state board can also take down those who are operating without a license that should have one, and at least here- its one of the few enforcement actions that's easy to prove & has some teeth behind it.

I'd investigate your state laws & see what they actually enforce.   You might be able to empty out the competition on Craigslist in a few months with a few well-written complaints.

Just a thought.  Ymmv.

Jon Klaus · Answer

Also, many of these "agents" are unlicensed and don't have an official code of ethics or standards. There is the law, but who is enforcing Craidslist ads?

FSBO Market. Nothing but Undercover Realtors and Wholesalers??

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