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Ricky Carruth, real estate coach and agent with 22 years of sales experience, says, “When you’re dependent upon a third party for leads, whether you’re paying for them or not, your business is susceptible to rule changes, market changes, and other factors that are out of your control. But when you build your business in a way where you produce the leads, then you don’t have to worry about a disruption or change in your lead flow because you can literally create deals out of thin air.”
In this article, he shares not only how to create these leads but also how to nurture them in a way that generates additional transactions today and a consistent flow of opportunities in the future as well.
Carruth built his real estate business by generating leads by calling condo owners, telling them about a recent sale, and asking them if there was something he could do to help them. He said that it worked great in the past because values had only gone up roughly 10 percent over a three-year period, and interest rates were around 5.5 percent.
They could sell the unit they owned and upgrade to a larger unit without a huge adjustment in price or a much higher interest rate than what they had on their current condo.
“Back then there wasn’t a lot of friction to the process, and it wasn’t a big decision to make a change. Today, it’s a big decision because prices are 50 percent higher than they were in 2019. The current mortgage rates, in many cases, are double or more than the rate they have in the place they own now.
This leads to a big difference in today’s market versus the markets of the past. The shift in the market has led to me transitioning the strategy to what I call situational prospecting,” Carruth shared.
What is situational prospecting?
He explained situational prospecting as the process of finding a situation that could be attractive to the people you are calling. The key is to shift from calling to see if they want to sell to calling to present them with a situation to consider.
“Most people love the home they’re in, so when people call and tell them they have someone that wants to buy their home, it can be just as threatening as the bank calling saying they are going to foreclose on their home. Most homeowners think, ‘I love my home, leave me alone.’
“Those types of calls can leave the homeowner with a feeling that the agent is calling with an agenda and just trying to generate a commission. That the agent is more worried about what the homeowner can do for them versus situational prospecting coming from a place of how the agent can help the homeowner,” Carruth said.
He went on to say there are different situations agents can find to share with prospects. The key is to think of the problems the homeowner might have and to come up with a creative solution. The following is an example he provided:
“Find a homeowner or listing with an assumable loan for, say, 3.5 percent. Call all the owners around that house that have smaller homes and say, ‘I see you have a three-bedroom home, do you need some more room and possibly a fourth bedroom? I’ve got one near your current home with an assumable 3.5 percent interest rate loan if you have been thinking about upgrading but didn’t want to trade in your current low interest rate for a substantially higher one.’
“Now you’ve shifted from calling them to see if they want to sell their house, but instead you’ve given them a situation to consider. There are a number of these homeowners that would love to upgrade right now, but they’re either worried they will regret getting rid of such an attractive rate or they think the situation they are looking for doesn’t exist. By providing them with a potential solution, you will create opportunities for a transaction that would otherwise not exist,” Carruth shared.
He also said that by presenting them with a situation, you are showing them that you are there to help them. He suggested coming with the attitude that if the situation doesn’t work for them, that’s fine, but let them know you would like to keep in touch via email so that when the time comes for them to make a move, you’d love to help them.
These calls set the stage for the agent’s business to be built in the short term and for long-term success at the same time by doing this one activity.
Nurturing the leads for long-term success
We then shifted the conversation to nurturing current and incoming leads in your database. Carruth believes email is the most effective way to stay in touch and consistently provide unique value to a larger group of people. He built his business and continues to coach agents to have at least a weekly email going out to their database.
“Email has become a social media platform. People go on social media, and they scroll until they see something that catches their attention or that is interesting to them that leads to them stopping to read an article or watch a video. It’s the same thing with email. They scroll through their email just like they do on social media, looking for something that grabs their attention that they decide to check out.
“Your email list is your social media platform that you control, to a certain extent. Whereas social media algorithms may only expose your posts or videos organically to roughly 5 percent or so of your followers, your email list numbers are in the 90 percent range of people that will at least see that your email came to them in their inbox,” Carruth explained.
He said you need to reach people via calls, texts and social media, but email should be the fundamental way you communicate with your database. But how do you consistently provide emails that keep their attention and keep them interested?
He said that automatic emails keep your name in front of people, but don’t really provide any value. He believes providing your opinion makes all the difference.
Instead of just sharing a few properties with links provided, he suggests having a deal of the week and explaining why this deal is attractive to you. Instead of highlighting a local restaurant with a link to their website, share your experience of the service, your favorite item on their menu, and maybe even a chance for anyone who replies to the email to be entered into a drawing for a gift card to the restaurant.
Carruth said including not just real estate information but also lifestyle information about your community is a great way to set your email apart from other agents as well.
“When you provide interesting information in your newsletter and not just about real estate, but about your local area with your opinion on why it is special, that is the winning formula for a weekly email that keeps people coming back and reading it week after week,” Carruth added.
Although the information he teaches agents to call with has changed over the years, the fundamental basis for building a business is still the same. Talk to homeowners. Find a way to see how you can help them. Keep in touch regularly with engaging weekly emails. If you do this consistently, you will have success.
Ricky Carruth can be found on Instagram.
