Why your motivated seller lists aren’t generating leads

Why Real Estate Investors Struggle to Generate Motivated Seller Leads

If you’re a wholesaler, flipper or real estate investor trying to figure out how to find motivated sellers, you’ve probably been handed the same advice: pull foreclosure lists, absentee owner lists, probate lists and tax delinquent lists. Send postcards. Make calls. Keep going. But if these are supposedly motivated seller lists, why are you working so hard to find somebody who actually wants your offer?

Unlearn everything you think you know about ranking, about SEO, about leads, about lead generation, about conversions, about anything that has to do with leads. If you cannot do this, you will always struggle to become successful, because, believe it or not, the industry has told you complete garbage.

So bring up everything you know, remember and think about SEO, lead generation, ranking and conversions. Then press the delete button and wipe your mind completely clean. Don’t worry. I will fill it with the right content.

Do you finally want your mama to think you’re handsome? Do what I say. Did you hit delete? Good.

Now that your mind is clear, you are a sponge, willing to listen and understand what I’m trying to tell you. Sit down, son. Get ready to be schooled.

Why Motivated Seller Lists Aren’t Finding the Sellers You Want

Okay, now, here is why you are struggling.

Think about what you are doing. What has the industry been hammering down your throat over and over and over again? Foreclosures, tax liens, probate. All these lists.

Now, what do you think is the one thing all these audiences have in common? Think about it.

Nobody is going to think, “Oh, hell yes, I am finally in foreclosure. I am forced to sell. Let’s go.” None of these people want to sell. Every single one of them is trying to find ways to keep their house, not sell their house.

So what exactly is it that you are doing?

You are literally going out of your way to target people who explicitly do not want to sell their house, to try to convince them to not only sell their house, but to sell their house at a ridiculous discount.

How friggin’ ridiculous is that!

What Is a Motivated Seller for a Real Estate Investor?

OK, so if foreclosures, tax liens and anything a list can provide are not motivated sellers, then what are motivated sellers, and how do you target them?

Ahhh… that is the question, isn’t it?

Answering the first will reveal the answer to the second.

A motivated seller is not someone who wants to, needs to or has to sell their house. Wrong.

To really understand and visualize this, think about the MLS. Do you truly think the people on the MLS are motivated sellers? Obviously not. Yet all of these people want to sell their house. They are not the right audience.

I break this definition down in full, quiz and all, in what you need to know about generating motivated seller leads.

Distressed Homeowners vs. Motivated Sellers

The biggest mistake you are making?

Thinking that circumstance (like foreclosure, tax liens, probate) somehow implies motivation.

This is the difference between distressed sellers and motivated sellers. Distress tells you something about the situation. Motivation tells you something about the offer they are willing to accept. A motivated seller list gives you clues about the first. It does not give you the answer to the second.

This makes sense, yes? Good.

Can You Target Motivated Sellers?

So if willingness to accept an offer below market value makes someone a motivated seller, how do you target people willing to sell below market value?

Bingo!

Two people in the exact same situation will react in completely different ways, because they are different people, in a different mood, with different everything.

You can’t target motivation, and the sooner you accept that, the sooner you will stop being surprised why you are struggling with lead generation. (Here is why no list, no software and no AI can find a motivated seller, and where they go instead: Google, and more and more, AI search like ChatGPT.)

Does it mean targeting foreclosures is bad? Absolutely not. You can target them, as long as you understand what you are doing and who you are targeting, so you know what your expectations are.

“Forced to Sell” Is Not “Willing to Sell Below Market Value”

Think about somebody in foreclosure.

Do they have to sell? Absolutely. If they don’t sell, are they going to be in trouble? Absolutely. Do they want to sell below market value? Absolutely not.

So again, think about what the entire industry has been telling you from the beginning. Foreclosures, absentee owners, probates: they all target people who are forced to sell. You are literally going out of your way to target the exact audience that is bad. You are going out of your way to target people who explicitly do not want to sell their house, to convince them to sell it. And not just to sell it, but to sell it below market value.

Are you still surprised you’re getting yelled at?

The Motivated Seller Lie the Industry Sold You

Now, here is the danger in all of this. The industry has brainwashed you into believing that this is the norm. This is the standard. You’re going to have to send 3,000 to 5,000 mailers, calls or texts to get a lead, to get a deal.

But now you see it’s complete horseshit.

If you have to send 5,000 mailers to get one contract signed, that means 4,999 out of 5,000 said no to you. That is a 0.02% success rate, which means a 99.98% failure rate.

Every dot is a mailer

5,000mailers sent

4,999said no to you

0.02%success rate

99.98%failure rate

In what logical, common-sense world does that translate to foreclosures, absentee owners and probates being the right audience? It makes no goddamn freaking sense.

If you’re wondering why direct mail isn’t working for your real estate investing business, start with the audience. Before you change the postcard, the envelope or the headline, ask who you are sending it to, and what makes you think they would accept the offer you’re making.

Yet everybody blindly turns off their brain and follows the lead sheep, who has no idea what they’re doing or where they’re heading.

The moment you put your own common sense into perspective, you will start to see the lead generation landscape for what it truly is:

The List Isn’t the Problem. How You Use It Is.

So does that mean you throw the list away?

No. The list is not the problem. What you do with it is.

Here is what everybody does. You pull a list. Foreclosures, absentee owners, whatever. And you start mailing. All of them. The same letter. Over and over and over again.

Here is what is wrong with that list.

1. It has one reason.Every name is on there for one thing. A single foreclosure filing. One circumstance. And you already know: circumstance does not imply motivation.
2. It treats everybody the same.The owner who will catch up next week and the owner who is drowning get the exact same letter.
3. It is frozen.The day you pull it, it starts going stale. Some of those people already caught up. Some already sold. Some had their auction cancelled. Nobody tells you, so you keep mailing them anyway.
4. Everybody else has it too.Every investor in your town pulled the same list. Same names, same week, same letter.

How to Turn Foreclosure Lists Into Leads and Profitable Deals

You only mail when you have more reason than a single foreclosure.

One stressor is a circumstance. Now picture the same owner with a foreclosure, an auction date coming up, a tax bill they can’t pay, and a house that has been sitting empty for months. That is not one circumstance anymore. Every extra stressor is one more push from “I’m keeping my house” to “I’m done.”

One owner, over a few months

1. Foreclosure filed
2. Auction date set
3. Tax bill unpaid
4. Vacant for months

“I’m keeping my house”“I’m done”

Replay

You still can’t target motivation. But you can stop mailing people with one reason, and start mailing people with five.

That is what filtering a list really means. Not by zip code. Not by equity. By the stressors that matter.

So how do you find motivated sellers? Start by separating a list of property owners from a list of people worth contacting. Understand what put each owner on the list, what else has changed, and whether your offer could solve the situation they’re dealing with. The next lesson explains which stressors deserve your attention before you spend another dollar mailing.

And once a seller does reach out, they still have to pick you over every other investor who mailed them that week. That is what the 3 Pillars of Conversion are for.

And here is the catch. Not every stressor matters.

Next lesson The stressors that turn a dead list into deals

• Which stressors actually matter, and which ones are a waste of a stamp
• Which ones stack, and how many it takes before you mail
• Why the same stressor is worth less every week you wait
• And the ones that mean: stop mailing this owner right now

Show me the stressors →

Ohh, and if you would rather watch me flip houses, and hopefully make some money doing it…

Questions About Motivated Seller Lists and Leads