What if you could have made $3 million more on your real estate investments? That’s exactly the lesson shared in a recent podcast where DealMachine Co-CEO David Lecko reflects on a crucial strategy that could have drastically increased his earnings had he implemented it eight years ago when he first started in the business.
Having found exceptional deals over the years, David managed to acquire nine rental properties, which appreciated a million dollars in value. Interestingly, he did this without putting down sizeable down payments on these properties. In fact, many of the down payments were zero, thanks to the quality of the deals he discovered.
The Power of Finding Great Deals
One of the main takeaways from the podcast is the importance of finding great deals.
"Most down payments I put were zero because I found such good deals."
Many new investors focus on wholesale real estate because of budget constraints, which David faced as well. It took him seven months to close his first deal. Initially, he opted for mail advertising, spending $0.70 per postcard. However, he emphasized that cold calling could reach homeowners for much less.
Overcoming the Fear of Cold Calling
The investor admitted he was initially scared of cold calling. Yet, cold calling proved to be a highly effective, budget-friendly method for reaching potential leads. Overcoming this fear could be the difference between financial growth and stagnation.
Real Conversations from Cold Calling
To demystify the process, he shared some of his real cold call conversations from his recent 9-hour cold calling session, much of which was conducted live.
"You can't say the wrong thing to a right person and you can't say the right thing to a wrong person."
This golden rule underscores that the goal of cold calling is to identify the right person interested in selling their property. Here’s a glimpse into some of these conversations:
Conversation Highlight with Carolly:
David: "Hey, Carolly. I was wondering about your property on Papas Road. Would you be interested in receiving an offer on it?"
Carolly: "What road is that? Oh, I don't live there."
Despite the initial mistake, David smoothly redirected the conversation, asking if she knew anyone in the neighborhood wanting to sell. It turned out they didn't, but Carolly appreciated the polite and courteous approach.
Utilizing Technology to Simplify Cold Calling
Modern technology can significantly streamline the cold calling approach. Modern tools, for example, can identify wrong contact leads, saving time by ensuring these do not enter follow-up queues. Other AI tools can also provide quick call summaries, enabling investors to move efficiently from one lead to the next.
Why Cold Calling Works
Cold calling isn't just effective; it's financially advantageous, especially for those with more time than money. This strategy is a practical approach to finding motivated sellers and good deals without requiring substantial financial investment upfront.
Conversation Highlight with Kim:
Kim: "I'm not selling. I have three units there, and I wouldn't sell one ever."
David: "That's amazing. Are you looking to buy more?"
This interaction revealed valuable insights into property values and opportunities specific to Southern California, enriching David's knowledge of this niche market.
The Results of Dedication
Perseverance and consistency in cold calling yielded tangible results. David shared metrics from one month of cold calling:
- 179 calls on 63 properties
- 4 appointments set
- 4 warm leads
- 56 voicemails left
- 62 no answers
- 11 not interested
- 32 disconnected numbers
- 7 timeshare leads skipped
Key Takeaways
David's journey highlights the effectiveness of cold calling in real estate investing. Overcoming the fear of making calls and leveraging technology to manage leads efficiently can transform prospects into profitable opportunities.
Final Thoughts
In real estate, the strategies you implement can significantly influence your financial outcomes. This blog demonstrated that adopting effective lead generation strategies like cold calling could have added $3 million to David's earnings over eight years.
By taking these lessons to heart, real estate professionals can streamline their processes, reduce costs, and ultimately increase their profits. Whether you're just starting or are a seasoned investor, there's always room to refine your approaches for better results.
Stay tuned to our blogs for more insights into real estate investing, strategies, and success stories.
About Benjy Nichols
Benjy has been a media specialist at DealMachine for the last 2.5 years. He produces, writes, shoots, and edits our media content for our member's DealMachine and Real Estate education.