Bankrate—com: http://www.bankrate.com/brm/movecalc.asp

CityRating—com: http://cityrating.com/costofliving.asp

Homestore.com: http://www.homefair.com/homefair/calc/salcalc.html

Relocation Essentials: http://www.relocationessentials.com/aff/www/tools/salary/col.aspx

Salary-com: http://swz.salary.com/CostofLivingWizard/layoutscripts/coll_start.asp

CNNMoney.com: http://cgi.money.cnn.com/tools/costofliving/costofliving.html?step=form&x=36&y=3

When you are just getting started, post-it notes or names/addresses in a notebook or a collection of business cards can work pretty good. But once you have talked with several people and/or completed a first deal, you will find that system unwieldy. Cards will get lost. Post-it notes get thrown out. And notes that should be kept about the quality of each contact never get recorded because it is too much effort to look for the contact name to write down your notes.

So if you are serious about your real estate investing, you need another way.

There are three ways that can work good for you depending on your temperament and your needs. They include using a rolodex/contact book, a PC based contact manager like ACT! or a more portable electronic contact manager like a PDA or a Blackberry. Each option has its pluses and minuses and each will be discussed below.

Rolodex/contact book – A rolodex is a great contact management system. It contains business sized pieces of cardboard and an alphabetic list of tabs. This lets you enter names alphabetically or by category – plumbers, carpenters, etc. Each card allows you to write quite a bit of information on it so you can record when you did business with a particular contact and your opinion of that contact. You can also easily rearrange the cards by pulling them out and moving them to an other place. If you were keeping the names by categories, this would let you put your favorites contacts in each category at the front of the section and your less favorite ones towards the back of the section. If one card gets damaged, you can just take it out, copy the contact information and put it back in. And you never need to worry about your rolodex crashing and eating up your contact list. In fact, short of a fire in your home or office, this is about the safest way to keep your contacts forever.

One final note about using a rolodex (or any contact manager) is to never remove a contact from it. You might find that you hated dealing with a contractor and want to throw the name out. It is a normal impulse but try to resist it. You might forget that person if get busy and be tempted to try that "new" person three years later because all your contacts in your rolodex are taken. If you keep the name in the rolodex with a note saying not to do business with this person, you will always know to head elsewhere if at all possible.

The only disadvantage of a rolodex is that it is not portable. That can be easily solved by getting a pocket sized address book and recording your top contacts that you may need when you are on the road. Chances are it is a small subset of the entire list so it shouldn’t take too much to create and maintain this portable contact system of your important real estate contracts. Names you would probably want in this portable book are names of contractors and tradesmen in case you run into an emergency while on the road. You may also want the names of a few trusted advisors that you could call when looking at a deal.

PC Based contact manager – PC based contact managers can be fairly simple or quite complex. Some can even dial your telephone for you. There are several nice things about PC based contact managers for your real estate business. They can be used to keep extensive dated notes about every contact. They can keep your calendar so you know when to follow up with someone. They often support exporting your contact list to a portable electronic device like a PDA. The calendar feature and limitless notes makes a PC based contact manager very powerful.

The main drawbacks of PC based contact managers is that they can be complex to install and setup and you can lose your data if your computer crashes. But if you follow a good backup program, that should not be an issue.

Note: There are also web based contact managers that you could install on your domain. These let you access your contact list anywhere you have access to a computer on the internet.

Portable electronic contact manager – PDAs and Blackberries and similar devices are a great way to keep your contacts portable if you are comfortable using these devices. Many people use them in conjunction with a PC based contact manager to reduce the somewhat tedious effort of typing in all your contacts on the tiny keyboard or touchpad offered by such devices. They often allow you to keep name and address details, a calendar function and some space for notes. And if it is integrated with your phone – like in a Blackberry – calling your contact is a one touch operation.

Backup operations on portable electronic contact managers generally require you to connect the device to your PC and upload your contact list to your PC. This is a reliable way to backup your list – or synchronize your PC based contact manager with your portable device without a lot of repetitive retyping. And as always, be sure to make a backup of your PC based copy of the list. One of the most painful things that can happen is completely losing several years of contacts.

So which system is best for the real estate investor? It all depends on your level of comfort with technology. I personally use a web based contact manager and a paper based book of important on the road contacts as I find that combination works best for me. When it is time to upgrade my cell phone, it is very likely I’ll get a Blackberry or similar phone and migrate to that for my portable contact list.

Whatever system you choose, be sure to keep it up to date. It truly becomes more valuable the bigger it gets.

Zillow – like most tools of this sort – relies on publicly accessible data. In some localities, the data is quite thorough. In others, it is quite poor or nonexistient. For instance, the house I lived in while in Florida has accurate information for the size of the house and number of bedrooms and bathrooms. In the house I currently live in – in South Carolina – the square footage is way off and the bedroom and bathroom data is nonexistient.

So where I currently live, Zillow is quite useless. While it does show actual sales and their sale prices, the data on those houses and the other houses in the neighborhood is so incomplete, it is not worth the time to use it as a research tool. However, from where I lived in Florida, it has pretty decent house data on houses where I lived for several years. So as a real estate investor in that area, it would be quite useful for doing quick comparisons of recently sold houses to houses I was considering buying.

As for using it for price estimates and comps, it is again only as good as the data it has. For instance, where I live right now, I would not rely on any of its comp values or home value estimates. And in Florida, because the market is pretty much in stasis, the information is not too valuable – but that is no the fault of zillow. When the market was active in Florida, the estimates were a decent enough ballpark of reality that they had some value.

The other challenge zillow offers – even in cities where the data is good – is that it knows nothing about the condition and upgrades of a home. A real life appraiser evaluates many things when calculating an appraised value – and will often throw out anomalies. (Anomalies include things like houses that were in a foreclosure or houses in a stick built community when evaluating a brick home community.) Zillow calculates automatically based on the data it has and while I don’t know for certain, I’d bet that they do not have the ability to filter like an appraiser can.

So, is zillow a good tool for you? As the above has shown, it really will depend on where you live. The best way to "test" zillow is to check out known properties. Get a list of properties from the MLS. They will probably be offered at around their appraised value. And you will have details on bedrooms, bathrooms and square foot estimates. Take that data and compare it to what zillow is showing you and you will have a good feel for what zillow can and can’t do for you in just a few short minutes. If the data looks good, add it to your suite of research tools. If the data is not so good, just bookmark it and check back in six months to see if it has improved.

As a final note, just remember that zillow is only as good as the data they can get for their database. Where I live here in South Carolina, the only good source of comps, accurate details of recent sales, etc. is through the MLS and unless you are a professional who is allowed access to that data, you can’t get it through zillow or any of the paid comp services that exist out there.

This scenario is repeated time and time again by both beginners and more experienced investors. But it doesn’t have to be that way.

The problem is simple. Whether we are initiating the phone call or receiving a call, we get nervous. This nervousness shows both in the phone call and in your ability to move on the data the prospect is sharing with you. Your analytical part of the brain shuts down. What should have been a smooth conversation falls flat on its face.

One way to address this issue is with scripts.

Scripts can be quite powerful. They give you time to ponder questions to ask before you are on the telephone. They also allow you to organize your questions into sensible groups so you can move through a phone conversation quickly and professionally.

And scripts are great when you are just getting started out. They help keep you more calm because you never have to think if you forgot to ask anything. And you always know where you are in your information gathering process.

The problem with scripts though is that if you are just reading from the script, the conversation is very mechanical. You never make that personal connection because you are too busy running down your checklist. And without building that connection, it can be hard to get cooperation for the more sensitive questions you may need to ask.

The solution is to evolve beyond the script. I’m not saying to throw the script away. I’m saying that at some point, you should know what you need to do without that script in front of you. In fact, your entire job on that initial phone call really boils down to two things. The first is building a relationship with the prospect. The second is getting the information you need to make a yes/no decision on the property. This will let you know if you should end the conversation nicely or move to the next step with this prospect.

So how do you get from being a mechanical script reader to a polished relationship builder?

First, you need to be ready to make a lot of phone calls because this is a situation where practice really pays off.

Second, you need a way to review the conversation. The best way to do this is to record the conversation and play it back later. Listen to the whole call several times.

(Note: Check your state laws before recording phone conversations. Many states allow phone recording as long as one party – you – agree to it. But some states may require that both parties agree to it. In that case, recording a conversation may not be a desirable action.)

The first time just listen to the whole thing from start to finish with no judgment.

The second time, listen to the buyer and notice where the tone changes from positive to negative.

The third time, listen to you and see what you were saying AND how you were saying it just before the tone went negative.

The fourth time, listen to the whole conversation again but stop the tape at trouble points. When you stop the tape, figure out what happened to change the tone and write down steps you could take in the future to eliminate this problem. Writing down possible solutions will help you imprint them on your memory so they will be there for future conversations.

Generally, you will discover it is just one or two habits that you have which cause the phone conversation to go bad. Write these issues and solutions on a sticky note that you keep by the phone and review it quickly before every phone call to reinforce building a better habit.

If you follow this method for just a few phone calls, you will find remarkable improvement. If you do it for several dozens of phone calls, you will find that you are becoming a very competent and natural relationship builder. And once you get to that point, you will have mastered an essential skill for real estate investing.

Once you do this analysis for several phone conversations and apply what you discovered, you will find your success rate at phone sales and relationship building will jump dramatically.