Editor’s note: This is the first of a five-part series.
What does it take to succeed in real estate? Whether you are a 40-year veteran or a brand-new agent, your success or failure in the real estate industry essentially boils down to four critical elements: systems, leverage, attraction and mindset — also known as SLAM.
Regardless of how experienced an agent is, strong systems form the foundation upon which successful real estate careers are built. Agents who have strong systems have more time to spend with buyers and sellers, which normally translates into more deals. The key areas where agents need systems include:
New agents must first master how to write contracts, what the ramifications are of the various contract provisions, as well as how to explain the contracts to their buyers and sellers. Sadly, many experienced agents have never mastered this information as well.
2. Digital or paper?
The digital real estate transaction is here to stay. Although there is a learning curve when you make the transition, shifting to a digital system is well worth the effort. Some issues you will need to address as you set up your digital transaction system include which transaction management platform and which digital signing service to choose. If you still want to use your paper system, what checklists will you use to manage the 100-plus moving parts of closing a transaction? Will you handle this task personally or hand off the file to a transaction coordinator once the property is under contract?
Virtually all mega-producers are masters of the inventory. In other words, they can walk in and correctly price a home without looking at the comparable sales. If you don’t have this level of mastery, it’s smart to develop a system that allows you to track new listings as well as the prices for which the property sold. Most agents find it easiest to remember properties based upon the street name, the type of property, and the name of the listing agent, i.e., John Agent’s remodeled brick traditional on 25th Street.
An even better way of organizing this data is to use Evernote. Evernote allows you to establish notebooks. Create a separate notebook for each subdivision or condominium building you serve. This will be an ongoing process — it’s not something you have to do all at once.
When a new listing comes on the market, clip the listing data to Evernote with a single click. Tag it with the address, city and ZIP code. When you walk through the property, take notes about the key features and add them to Evernote. Over time, you will not only have mastered the inventory, you will be able to pull up the actual data long after it is no longer available on the MLS. Again, the point here is to create a system that supports your process.
4. Sphere of influence
Having a strong sphere of influence will help you to create a strong referral database. Your ultimate goal is to develop a list of approximately 150-200 people who will either do business with you when they want to list or sell a piece of property and/or who are comfortable referring business to you.
One of the best ways to manage this process is with a client relationship management system. This could be a system such as Top Producer or the Salesforce.com REthink Real Estate CRM. While you could manage your sphere/contact database from your email system, having a professional CRM allows you to do bulk emailing and provides a much more robust series of options for managing your business.
5. Lead generation
Your job description in real estate comes down to six words: generate leads, convert leads, close transactions. The most successful Realtors have strong lead generation systems. To illustrate this point, those who cold call or knock on doors usually do so at specific times of the day and week.
For example, if you are holding a Sunday open house, the best time to door-knock and invite neighbors to your open house is on Saturday morning. If you’re cold-calling, you’ll get better results in the morning than you will in the afternoon or evening.
If you are calling on the owners of expired listings, what is your system for working with them? Do you go out and knock on their doors? Do you track old expired listings from 12-18 months ago? For people who live out of the area, do you have a mailing system that you regularly follow? The beauty of setting up a system is that once it is in place, it usually takes little effort to maintain it. In contrast, when you lack systems, you are frantically trying to figure out how to squeeze everything in to your busy day.
6. The ultimate system: a business plan
Ninety percent of the businesses that fail in the United States lack a written business plan. This generalization also applies to real estate: The highly productive agents usually have a detailed business plan. This includes a budget that allows them to put money aside for taxes, emergencies and even for retirement. Those who lack a written business plan often wash out of the business or, at best, never really live up to their full earning capacity.
Lack of organized systems creates stress. This in turn leads to more chaos and less productivity because you are constantly having to deal with logistics rather than being face-to-face with sellers and buyers.
Want to know more about the SLAM model? Stay tuned for Part 2 of this series: leverage.