Not too long ago, I was sitting on a patio in Andersonville with another long-time Chicago real estate investor. We were talking leads and how hard it typically is to find quality ones. He mentioned how there are so many avenues out there but they don’t always lead to a sell. We then began discussing the value of paying for marketing services that give you a better chance at obtaining a quality lead.
In order to invest in Chicago real estate for cheap, you need a way of getting quality leads that doesn’t waste your time and money. You want the leads that not everyone else is getting. The thought of how much it may cost to obtain these leads can be intimidating, even for experienced vets, and doubly so if you’re just starting out in real estate investing. Thankfully, there are ways to get good leads without spending an arm and a leg.
No matter where you are in your career, or where in Chicago you’re looking to invest, you want to be able to get the best leads in the most efficient way. Saving money on lead generation to find the ideal property is the only way to invest in Chicago real estate for cheap.
The Challenge of Getting Good Leads in Chicago
Real estate investing in Chicago can be a real challenge, for a number of reasons—mainly because there are a lot of real estate investors in Chicago. Chicago real estate investor meetups show dozens of groups with memberships of over 1,000 people—sometimes up to 5,000. Sure, there’s overlap, but the point is that there is a lot of competition.
Another challenge is the fact that there isn’t a lot of middle ground in the city. There are real estate investors looking to fix-and-flip for cheap in Chicago’s “worst” neighborhoods, and there are investors looking to make a fortune in the hot or soon-to-be-hot neighborhoods.
So what makes a good lead? A good lead has three important qualities:
- The seller is ready to make a deal. You don’t want to spend a ton of time going back and forth negotiating, especially if they are just testing the water. You want them ready to sell once you’ve been contacted.
- The house is affordable. This is obvious, right?
- The house can be resold or rented out when you’re ready. You don’t want to be stuck with holding an investment property that you intended to fix-and-flip quickly.
These three qualities are what the thousands of real estate investors in Chicago are looking for, making obtaining a quality lead a challenge.
The best way to beat the competition is to be resourceful.
How Real Estate Investors Get Leads in Chicago
Getting leads is fundamental to your business. And we all know, you have to make an initial investment to get quality leads. There are free ways to get leads, but they are rarely, if ever, quality leads. And then there are expensive ways to get leads which may not turn out to be worth it either. But I don’t think you should look at it in terms of cost. You want to look at it in terms of value. Are you wasting your time, which in this business, is money? Are you getting a good enough ROI on your lead generation to justify the spend?
Speaking of lead generation, there are two approaches to consider: finding sellers and having sellers come to you. Finding sellers is the more traditional approach—cold contacting someone who is selling and making them an offer. Having the seller come to you can be more beneficial because, at that point, they are likely ready to make a deal. The challenge comes in making sure you’re top-of-mind when they are ready to sell.
Over the years, I’ve come across real estate investors in Chicago who’ve told me stories about the ways they’ve found leads. I’ve listed them below:
If you aren’t looking to spend money, you can trawl through the real estate section of Chicago Craigslist, or the public section of sites like Truila or Redfin. There are a few problems with that, though, namely that anyone and everyone can do the same thing. You have to get really lucky to find a hidden gem there.
Real Estate Investing Clubs
These clubs and meetups are great places to network, and many people think that they are great places to swap stories about leads. That can happen, or you can be clued into the gossip about an exciting new neighborhood or community. Regardless of the topic at hand, it’s not likely that you’ll leave the conversation with a new lead.
Free (Low-cost) Advertising
Craigslist is a way to advertise for free, or inexpensively (their standards sometimes change). But you have to keep updating your ad to get it in front of site visitors. You have to be able to stand out from the rest of the real estate investors who are doing the same thing. You have to stand out to the right person right as they are looking at Craigslist for a buyer. And, you may have to prove that you’re legit. There’s a reason it’s free: Craigslist for real estate in Chicago is a dead-end.
I love looking at Chicago houses on Instagram. But I hate looking for real estate on Instagram. Trying to leverage social media to get leads presents some of the same problems as free or inexpensive advertising, with even fewer chances of finding promising leads.
Listing your ad in a newspaper, for example, can add more legitimacy than Craigslist but it will cost. There are varying rates. You can list an ad in Reader for $20 per 20 words, and then $1 per additional word. Ads in the Chicago Tribune start at $200. Rates for the Chicago Sun-Times vary but you can expect to pay a decent amount. The trouble is that you still have to hope people see you right when they are ready to sell, or see your ad enough that they remember you. So you either have to get ridiculously lucky or advertise a lot and still wish for luck.
There are a lot of billboards in Chicago, and some are iconic. Seasoned Chicagoans will still remember the Magikist signs. To be part of this club, you have to pay. You may be able to place your ad on a bus stop bench for $400 per month on a bus bench or up to $10,000 for a billboard over the highway. The question is: how many billboards do you need to become a household name? Think about those hair replacement signs by Urlacher: they are everywhere, and you know them. Can you afford to spend that much to become a household name?
Real estate investors love the Cook County Sheriff’s auctions. For one thing, you aren’t dealing with finding a seller or having them come to you. The houses are there and the sale is fueled by money—no seller emotion involved. There are a lot of houses and a lot of action. Cheap houses come up and everyone starts to bid. It’s exciting! It’s also a way to get into a bidding war where chances are you may walk away with nothing or pay far too much for a property. At these auctions, you’re presented with a lot of houses, but ending up with the perfect house at the right price can be like winning the lottery.
Each of these resources can have its benefits but they don’t guarantee quality leads. The best approach is to have a trusted way to get high-quality and inexpensive leads that are ready to sell without you having to search high and low or fight off competition.
Luckily, there is a way.
The Best Way to Invest in Chicago Real Estate for Cheap
When it comes to finding leads that possess the aforementioned three qualities, I can honestly say that being an independently owned and operated HomeVestors® franchisee has helped me tremendously. It has been the best way for me to invest in Chicago real estate for cheap.
It works because anyone looking to sell knows HomeVestors®. They have those ads you’ve seen here in Chicago since 1996: We Buy Ugly Houses®. So when people are ready to sell fast, they call HomeVestors®. And the sellers’ calls can be routed directly to me in real-time. I’m essentially outsourcing all my advertising and working with a nationally-known name. All I have to do is close the deal.
Investing in a HomeVestors® franchise has proven its value. As a franchisee, I can buy houses for less without wasting time on dead-end marketing and chasing leads. It lets me stay ahead of the game in Chicago real estate, no matter the competition.
If you want to get leads and get cheap Chicago real estate, request information about becoming a franchisee.
Each franchise office is independently owned and operated.