Have you tried unsuccessfully to increase your real estate profits year after year? Are your operating expenses heavily impacting your bottom line?
Learn how you can increase your real estate profits in a powerful, comprehensive manner by making a few simple changes to the way you do business as a real estate agent.
Many agents focus so much of their time on sales that they lose sight of the big picture. This is something that today’s podcast guest Raj Bhaskar has seen all too often.
As founder and CEO of a company dedicated to helping independent professionals manage their business finances, Bhaskar knows what it takes to increase earnings, lower expenses and decrease taxes to boost profits.
Increase earnings
As you might expect, the first key to increasing your real estate profits is to boost your earnings.
There are two primary ways to increase your earnings as a real estate agent. The first (arguably the easiest) way to do this is to raise your average sale price. In other words, you want to focus on selling more expensive homes.
The other way to increase your earnings is to sell more properties.
Depending on your local market, you may want to focus on increasing sale price, increasing your sales or finding a good balance between the two.
Lower expenses
The second key is to lower your operating expenses.
Start tracking your expenses, and take a close look at where your resources are going.
In areas where you dedicate fiscal resources, such as lead generation, you want to ensure your returns are justified. If you can see that certain areas are failing to generate satisfactory results, you can reallocate your resources or simply cut that spending to improve your bottom line.
Decrease taxes
Decreasing your taxes is one of the most important profit growth levers.
Unfortunately, it’s also something agents tend to neglect, especially early on in their careers.
In many cases, agents fail to take advantage of deductions in fear of being audited, but others simply fail to track potential deductions, like mileage, because they view it as tedious.
These days, with the availability of affordable professional accountants and the ability to automate the tracking of potential deductions, it really is worth dedicating some extra time and money to decreasing your annual taxes.
Bonus: Your value proposition
Do you have a value proposition that clients can’t say “no” to?
If not, it’s time to go above and beyond what the average client would expect.
You want to offer something meaningful that other local agents don’t provide. For some clients, this might mean helping them with the process of getting approved for a loan. For others, it might simply be delivering excellent customer service.
Take a long, hard look at what differentiates you as an agent. Ask yourself why potential clients should choose you over someone else.
Believe it or not, many agents have a hard time answering this question. When you can, you’ll be one big step ahead of the transaction-based agents who focus all of their attention on closing and ignore the end-to-end customer experience.
Pat Hiban is the author of NYT best selling book “6 steps to 7 figures – A Real Estate Professional’s Guide to Building Wealth and Creating Your Destiny”, the founder of Rebus University and the host of Pat Hiban Interviews Real Estate Rockstars an Agent to Agent Real Estate Radio Podcast with Hiban Digital in Baltimore, Maryland. Follow him on Instagram or Twitter.