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Are you tired of paying 20 percent to 40 percent to the portals and lead generation companies for listing leads? Would you like to know which properties in your market area are most likely to come on the market in the next 90 days? Would you like to tap into the cash buyer and real estate investing market for listing leads?
In February 2024, Craig Rowe’s Intel column reviewed Realeflow’s leading AI investment software, which boasts over 200,000 users and has led to more than $10 billion in closed transactions. Here’s what Rowe had to say:
Realeflow, a software company that applies AI-backed predictive analysis and machine learning to identify seller activity, has released a new version of its AI that allows investors and agents to recognize a person’s probability to sell within 90 days “for almost every residential property in the United States,” by processing 136 billion data points assembled from more than 40 years of sales data married to corresponding demographic and socioeconomic metrics.
Investors can search according to location, price, and square footage to receive three scores for each potential property’s status within the next 90 days. Those scores include the “retail score,” equating to the probability of a home selling close to its estimated value; the “wholesale score,” rating the probability of a property selling at a discounted price; and the “rental score,” which evaluates a property’s ability to be rented.
How Leadflow can help you take more listings
On April 30, 2024, Realeflow launched Leadflow AI Agent, its 11th-generation AI software for residential real estate. Backed by 20 years of investor data tracking exactly what events cause a property to be listed for sale, Leadflow’s generative AI analyzes over 160 billion data points to determine their retail, rental and wholesale “sellability” scores.
I recently sat down with Realeflow’s founder and CEO, Greg Clement, to learn more about how Leadflow AI Agent can help agents take more listings. We also discussed how residential agents can create an entirely new source of listing leads in residential investment, which now accounts for 29 percent to 30 percent of all single-family residential sales, according to Corelogic’s most recent data.
How Leadflow ‘sellability’ scores work
As Rowe noted, the sellability score functions much like a credit score since it identifies which properties are most likely to come on the market within the next 90 days. Scoring ranges from zero to 1000.
“The way we look at the sellability scores is that 500 is the median. Any score below 500 has a lower propensity to sell than average, and anything over 500 has a higher propensity to sell on average,” Clement said.
“So, let’s assume that around 500 about one percent of the single-family residential properties will sell every 90 days. What happens when we move to 600, that number jumps to four percent, at 700 it gets in the eight percent range, and at 900 to 1000, 16 to 17 percent of those properties will sell in the next 90 days.”
Instead of shotgun marketing using Facebook, direct mail, door knocking, bus benches, billboards or TV ads that go out to everyone and only yield about a 1 percent return, using Leadflow’s AI you can target market the properties most likely to sell in the next 90 days. This approach can dramatically improve your listing conversion ratios plus save you time and money.
How Leadflow’s AI came into being
Clement attributed the idea for Leadflow’s generative AI to a successful Chicago-based investor who told him that the only marketing he was doing was to people who were at or near retirement age and who subscribed to Southern Living magazine.
Based on that conversation in 2019, Clement went back to his team for feedback. The team agreed that AI would play a pivotal role in both investment and residential real estate sales going forward. This led them to develop their first-generation predictive AI, which outshines what any human can do in terms of locating and evaluating data.
“Predictive AI can find patterns in the data that a human cannot, no matter how good they are. We can’t process billions of data points in a moment and then assign a score to almost every residential property in the U.S.,” Clement said. “We found that a large number of small factors that happen over time are what causes someone to put a For Sale sign in their front yard.”
To illustrate this point, “One interesting pattern we discovered was that the age of the development matters, the age of your home, and when you built or bought that home, because when your neighbors start to sell their properties, many others will follow suit over the next few years,” Clement said.
He then explained that these factors could be caused by a decline in the school rankings, property taxes increasing at higher rates than surrounding areas, or if there were four people living in a house, and then, over several years, that number dropped to two.
“Our AI can look at the data and then create new data elements such as “empty nester,” when the children go off to college.
One of the most unexpected findings their AI uncovered was that “nearness to a cemetery” negatively impacts sellability. In contrast, “covered porches” increased sellability scores.
Timing is everything: How Leadflow differs from the portals and lead generation companies
Zillow, Realtor.com, and several other lead generation companies sell individual curated buyer and seller leads who are deeper into the funnel, or their decision process.
Leadflow’s AI offers predictive lead qualification by offering key indicators that will lead you to potential sellers at the optimal time to obtain the listing. Using more than 160 billion data points, the algorithm aims to identify would-be sellers well before they would ever contact a portal. This advantage is particularly beneficial for investors, rehabbers, and flippers.
For $199 per month, their AI Pro product, users can access up to 10 AI ZIP codes with 10,000 downloads/month. The graphic below provides a list of the 20 different lead types that agents can search.
Additional features that make Leadflow different from other lead generators include:
- 250 LeadTrace credits (Once you identify who you want to contact, LeadTrace provides you with phone numbers and email addresses for potential leads.)
- Access to their CRM to track data.
- Deal alerts (Investors and agents can instantly access deals that meet their exact deal criteria and hit the ground running so they can get the best deals first.)
- Zapier integration with many other apps.
As Clement observed, “No agent or investor has exactly the same criteria.” Leadflow allows you to search the lead types best suited to your unique market and skills.
Which lead types are performing best in today’s market?
Here’s what Realeflow is currently seeing in the data about which of its 20 lead types is performing best in today’s market.
Bored investor
A “bored investor” is an absentee owner who owns the property but doesn’t live in it.
“So, 99 percent of the time, it’s going to be a rental property, that in many cases they have owned for 15-20 years or more,” Clement said. “They’re emotionally disconnected from the property, they have taken a major amount of depreciation over the years they have owned the property, and now is a really great time to put these properties on the market.”
Potentially inherited
While this category includes probate, what agents and investors haven’t been able to access are properties where a parent has passed away and left their house to their three children, all of whom live elsewhere and lack the money to fix it to bring it to market. The result is these houses often sit vacant for years.
Timing is a major challenge when it comes to reaching out to a seller who has lost a parent. Clement explained:
“While the temptation is to reach out to the new owners right away, it generally takes six to eight months before the transfer of title to the new owners takes place. Our AI found that seven months is the sweet spot. As we like to say, ‘Timing is everything.’”
Delinquent taxes
Delinquent taxes are usually an early indicator of financial distress.
“If homeowners are short on money, they will often pay their mortgage, but not their property taxes. If their tax bill comes due twice a year, they will often set the tax bill aside,” Clement said.
“If the homeowner misses their second tax payment, their sellability score really shoots up. This can be an excellent lead for both agents and investors.”
Absentee owners (investors), all cash buyers, and high equity sellers often overlap
Clement described how Leadflow can easily identify all-cash investors:
“It’s very easy to spot single-family investment properties purchased with all cash since there is no mortgage on the property and [the owners] don’t live in the property,” Clement said.
He then explained how this visibility allows you to network with verified all cash buyers and start building a list that you can then reach out to when new investment opportunities (high propensity to sell as a rental or wholesale) turn up in your Leadflow searches.
Renters
The software allows you to access rental information based on the property where the renters are currently residing. This can be a great source for first-time buyers as well as a resource you can share if an investment client has a property that becomes vacant.
3 other lead sources to add to your lead gen tool box
TheClose.com has a comprehensive list of their top 10 predictive analytics companies for 2023. Leadflow’s closest competitors, in my opinion, are Likely.AI, Revaluate, and SmartZip.
Likely.AI and Revaluate are different from Leadflow in that they clean your database and use their AI to identify those likely to sell within your database. It’s much easier to convert a lead within your own database than it is to convert a stranger.
I’ve written in the past on Likely.Ai’s unique refresh engine that lets you identify the contacts in your database that are most likely to transact in the next 90 to 180 days. According to their website, “1 in 10 of our predicted sellers list within 90 to 180 days.” Leadflow’s numbers are close to 20 percent, and they will transact within 90 days. Again, the difference here is people who know you vs. strangers.
In addition to cleaning up your database and identifying who is most likely to transact, Revalaute’s “Reside” tool can help you build a database or farm from scratch.
Thinking about becoming a real estate investor?
If you do decide to pursue one- to four-unit residential units for your own investment account, visit Leadflow’s parent company, realeflow.com.
On that site they provide you with the tools to analyze potential deals, make an offer directly to a potential seller, find “private lenders” who might be interested in funding your next deal, as well as being able to estimate the cost of the rehab or remodel in as little as five minutes using Home Depot’s real-time pricing tools.
The most important step to take
Regardless of where a lead originates, NAR’s most recent Profile of Home Buyers and Sellers shows that the first agent who meets face-to-face with a seller who is ready to transact has an 80 percent chance of getting the listing. Spending money on lead generation is a waste of money unless you’re prepared to do what it takes to convert that lead into a signed listing.
Clement’s final piece of advice for agents about creating more listings
“Embrace tools like ChatGPT and Leadflow AI Agent to enhance efficiency, stay ahead of the market, and gain a competitive edge. Treat AI as your indispensable assistant that enhances your capabilities and helps you stay ahead,” allowing you to create more listings where there are none.
Bernice Ross, president and CEO of BrokerageUP and RealEstateCoach.com, and the founder of RealEstateWealthForWomen.com is a national speaker, author and trainer with over 1,500 published articles.