From 2018 to 2028, it is projected that each year 1.2 million new households will be added to the US population. This growth is expected to impact all areas of the American economy, but its effect on housing will be particularly strong. Since each of these new households will need a place to live, housing demand is expected to grow during this period.
This means opportunities for people and businesses in the real estate industry. But given the cutthroat competition in the sector, businesses that want to take advantage of the trends must know how to find these potential customers. They must be adept at targeting the right people and converting them into buyers.
Doing this is not merely about businesses having an online presence. It is more about refining their strategy to ensure that they are actually talking to people who can buy from them when they interact with online customers. That’s because when selling online, many businesses spend too much time and resources engaging with leads that are not ready to buy.
To avoid this problem, landlords and property managers must have a lead qualification process with the proper criteria. Lead qualification is how a business filters prospects based on their willingness and readiness to buy. It is an information-gathering mechanism that ensures precious resources are not wasted on leads that are not ready to convert.
Here is a list of the best criteria to use for property owners and managers trying to figure out the best way to catch unqualified leads early in their sales funnel.
Lead Qualification Criteria for Landlords and Property Managers
Criteria #1: Location
Location is the first criteria for determining if a lead is relevant. Regardless of how many buyers you attract, if none of them is looking for a house in your location, you have wasted your time. This is the first information to get from leads; ask them the exact zip codes of the neighborhoods they want their home in. Also, ask if they will be interested in other neighborhoods to find a similar property there.
Criteria #2: Budget
The next information to get from a lead is the price point they have in mind. Getting an idea of how much they want to spend on the home will tell you if there is even a chance of finding a home that suits their budget. When asking for the lead’s budget, find out how flexible the budget is and their readiness level – do they have money for the down payment, and how good is their credit?
Criteria #3: Mortgage
The lead’s mortgage situation determines if the purchase can go forward or not. Have they been approved by a lender? Do they even need a mortgage, or they intend to pay cash? If a lender has not preapproved them, would they like to be introduced to one? Does the preapproved amount justify their budget? A lead that has been preapproved for a mortgage is clearly motivated and ready to take action. It’s also a good sign if they are about to start the preapproval process.
Criteria #4: Agent
Lots of buyers will work with two agents at the same time. This means they are actually wasting one of those agent’s time. Asking if a buyer has an agent prevents you from dedicating too much time to someone who uses you as a backup. When trying to find out if a lead has an agent, ask them how they have been searching for their home. Do not ask if they have an agent directly, or they may lie.
Criteria #5: Preference
Leads that can provide details about the home they are looking for are closer to buying. Each specific requirement a lead provides helps narrow the search and reduces work that finds their ideal property. Real estate leads’ preferences or requirements may include the type of property, number of bedrooms or bathrooms, type of school in the neighborhood, type of flooring, and certain amenities in the area.
Criteria #6: Timeline
Finding out how soon a lead wants to be in their home offers an idea of how ready they are to buy. It provides an idea of where the lead is in the sales cycle. Questions that may help determine this include are they waiting to sell their property before buying? Can they move forward on the purchase if they find their ideal home tomorrow? Or do they need some time but would be willing to receive weekly or monthly updates on new listings?
Criteria #7: Appointment
Leads who suggest a meeting are usually closer to buying than others. Those who delay the meeting may still be farther down the road. Rushing to make an appointment with a lead will not make them any readier to purchase. It is best to arrange meetings only after a concrete picture of the lead has emerged. And the meeting should only hold if there are things you want to show the lead that they cannot see online.
Use these criteria to use to qualify leads for your real estate business, and you’ll have the leads you need and want for your real estate investment business. Don’t have the time to screen real estate leads and tenants to this extent? Contact us today at Real Property Management First Choice, and we’ll take care of the entire process for you.
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