Cold calling has long been a staple of the real estate industry. Still, in the digital age, many agents find it increasingly difficult to connect with potential clients using this traditional method. As the market evolves and consumers become more selective about who they engage with, real estate agents may feel uncertain about the effectiveness of cold calling in 2023.
This uncertainty can lead to frustration and anxiety as agents grapple with the fear of rejection and worry that their efforts may not yield the desired results. Many agents may question whether they should continue cold calling or shift their focus to other marketing strategies.
This comprehensive blog post will demystify real estate cold calling and give you everything you need to know to succeed in 2023. We’ll cover the latest trends, techniques, and best practices to help you overcome common challenges and connect with potential clients effectively. With our expert guidance, you can regain confidence in your cold-calling abilities, refine your approach, and continue to generate valuable leads for your real estate business.
Five Types of Cold Calls
It’s safe to assume that home sellers with expired listings are looking for a new Realtor. Get ahead of your competition by giving these potential leads a call and offering your value. They’ll be thankful that you saved them the time and effort of finding a Realtor.
Become the number-one expert in your area by cold-calling all the potential leads in a single neighborhood. This will help you expand your sphere of influence and turn you into an authority in that area. Cold calling this type of lead usually turns out successful because if other homes in a neighborhood sell, it inspires other homeowners to sell.
As Realtors, we all know it can be challenging to work with FSBOs. But the reality is that most homeowners trying to sell their homes will not be successful. For this reason, it’s worth it to cold call these potential leads and convinces them that you can help them.
Landlords struggling to fill their vacant properties make a good source of leads. Cold-calling landlords are typically easier because not many other Realtors prospect for them. Also, they already tend to be business-minded and will be more open to your proposal.
Homes under pre-foreclosure can make valuable leads. Cold calling these leads is often less competitive and allows you to demonstrate your value by helping someone through a distressing ordeal.
Does Real Estate Cold Calling Still Work in 2023?
The short answer is yes, real estate cold calling still works in 2023! However, it is important to remember that it is a difficult, long-term game. While anyone can make cold calls, you must be consistent in your efforts despite facing rejection at a high level.
But on the other hand, you will find that you consistently build new relationships due to your hard work calling and following up with people. Most importantly, you will find success if you focus on adding value to the prospect’s situation rather than just trying to make a sale. Also, staying organized and utilizing tools like the REDX Power Dialer will simplify the cold-calling process.
What Do I Need to Be Able to Cold Call Effectively?
Accurate Phone Numbers
It may seem obvious, but accurate phone numbers are the biggest key to success at cold calling. In addition, you need to have a consistent supply of these phone numbers. The best way to do this is to sign up for a subscription service that finds the best numbers for you. A paid service will save you time on researching on your own. I’ve used REDX for over four years and find they have the most accurate numbers for the best price.
Database or CRM
Next, you will need a system to track your leads and your relationship status with them. For example, whether you need to follow up with them, whether they are uninterested, or are on track to become leads. Many dialer systems have built-in CRM systems you can use, such as REDX’s Vortex system.
Another indispensable tool for cold calling is a dialer system. Dialing each number by hand takes too long and is not an effective use of your time, especially if you get no response. Dialers can dial multiple numbers at once so that you’ll spend less time waiting and more time talking to leads. They also gather phone numbers for you, dial them automatically, and even provide scripts. A great system is REDX’s Power Dialer.
It also helps to have some scripts, especially if you are a newer agent. Scripts help you prepare if you lack experience and haven’t perfected what to say to win the most leads. You can find all sorts of different scripts out there. Some great options are Mike Ferry, my FSBO Script, and REDX.
What is the Success Rate of Cold Calling?
As of last year, cold calling had an average success rate of 2%. However, don’t take this as a sign of discouragement. Cold calling is still a successful and essential lead-generation strategy for many businesses. Organizations that did not engage in cold calling experienced 42% less growth than businesses that did.
In the real estate industry specifically, it takes about 12 hours of calling and 208 cold calls to achieve one listing, appointment, or referral, according to a study by the Keller Center at Baylor University. So if an agent’s average commission is $4,641, you get a return on investment of $386.75 per hour!
The same study also found that if you spend 15 hours a week making calls, you can increase your commission to nearly $300k. However, most agents get burnt out from being on the phone for so long, and most aren’t willing to make that effort. Finding success at cold calling is a long-term game that requires patience and determination.
What is the Law on Cold Calling?
To start real estate cold calling, you must comply with telemarketing laws. This primarily includes the Telephone Consumer Protection Act created by the Federal Trade Commission. This act prohibits Realtors from calling clients with numbers on the Do Not Call Registry. If their number is on the registry, you cannot call FSBO sellers or expired listings. If you do, you may be subject to a $1,500 fine per violation.
Many dialers automatically check their numbers against the Do Not Call Registry so that you can be sure you’re only calling the appropriate numbers.
How Many Cold Calls Should I Make a Day?
It’s important to remember that your priority shouldn’t be the quantity of calls so much as the quality of those calls. You aim to connect with people, have meaningful conversations with them, and seek to provide them value.
With that being said, there are goals you should aim for to ensure you’re making the most of your time while real estate cold calling. Following the 15 hours a week mentioned above translates to three hours of calls, five days a week. In these three hours, you should try to make at least 60 calls per day. If you split this up over three hours, you should make 20 calls per hour.
How Long Does it Take to Make 100 Cold Calls?
Depending on your dialing system, it can take one to five hours to make 100 cold calls. Reaching 100 calls depends on how many numbers your dialer can dial and how many people you reach.
You can probably make around 20 calls per hour if you manually dial. But if you want to increase your chances of success, a dialer can help you reach many people. For example, you can make 50 to 85 calls per hour with a single-line dialer. You can make as many as 200 to 300 calls per hour with triple-line dialers.
What is the Best Time to Make Cold Calls?
So when is the best time to reach the most number of people? Of course, you should never call too early or too late at night. Inman says the ideal time to make the most successful calls is between 10 am and 2 pm.
However, you might find that a different time works better for your business. According to a 2017 study by CallHippo, the best time to call is between 4 pm and 5 pm in the prospect’s local time. This is because they are wrapping up their day and aren’t likely to be starting new tasks at work. As a result, they are more open to taking your call. The second best time is between 11 am and 12 pm. The study also found that the best days to call are Wednesday and Thursday.
Final Thoughts on Real Estate Cold Calling
Real estate cold calling is an important lead-generation strategy that is still worth your time. If you use the proper tools and scripts and focus on creating meaningful relationships, you will surely succeed with cold calling.
That being said, cold calling isn’t for every agent and isn’t the only way to be successful as a real estate agent. Check out my post on generating leads and closing deals without cold calling.
Let me know your thoughts on cold calling in the comments below. Have you ever made a cold call? Which types of leads do you prefer, and why? Do you call expired listings and FSBOs, or prefer geographic farming? I’d love to hear from you.
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I’ve helped hundreds of real estate agents, team leaders, & brokers all over the country increase their sales, online presence, and create scalable systems. I would love the opportunity to work with you. Together, we can make this year your best yet!