With nearly 150 posts on Inman, a successful podcast that interviews over 100 real estate pros per year and a 25-year real estate career, Pat Hiban knows the ins and outs of real estate. Catch his regular monthly column on Tuesdays.
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As a former real estate agent, I know how disheartening it can be to have a year of strong sales only to discover that your net profit, the number that really counts, hasn’t quite kept up the pace.
Now, as someone who interviews 100-plus real estate professionals a year for my podcast, I also know that low-profitability problems are extremely common.
In fact, of everything I ask during interviews, nothing makes guests more uncomfortable than a question pertaining to profitability. Many guests ask that I edit their answer out of the show. Others outright refuse to answer.
There are some guests, however, who are proud of their net profit — and deservedly so.
These are real estate professionals with profit figures that exceed those of their peers by a significant margin. These are the guests who get an additional question at the end of each interview:
“What’s the one thing agents can do to drastically increase their profits?”
In this post, I’ve included 10 short videos featuring the most profitable real estate professionals I’ve interviewed and their answers to the question above. Watch for ideas on ways to keep more of your hard-earned commissions moving forward.
1. Don’t buy services from salespeople
Colleen Lawler has a massive 65 percent profit margin, one that she’s able to maintain by avoiding unnecessary services. Hear why she doesn’t buy services from salespeople, and how she decides what her team really needs in the video below.
2. Cut low-converting lead sources
Is it time to change your lead generation strategy? Unless you’re tracking where your dollars are going, how do you really know? In the following video, Chris Dufala describes what he cut to push his profit margin through the roof.
3. Trim the fat
Agents love to spend on leads — sometimes a little too much. Discover what New York-based agent Jay Glazer recommends regarding lead services to lower expenses and raise your business’ bottom line.
4. Simplify your systems
With all of the real estate technology available today, selecting the right systems can be daunting. Charles Burgess found that experimenting with the latest, greatest systems actually cut into his profits. Discover why he suggests getting back to the basics in this video.
5. Stop wasting money on advertising
Get over yourself already! That’s Chris Stafford’s advice to those who are still wasting countless dollars on advertising that doesn’t really work.
Watch this video to find out what he recommends instead and how he’s able to maintain a 63 percent profit margin.
6. Find your niche
You’ve probably heard the saying, “There’s riches in the niches.” For John and Mikki Ramey, it’s one that definitely rings true. Watch the video below and discover how niching down could drive your net profit way up.
7. Reward for referrals
Jeannie Grant has a huge 68 percent profit margin; one that she maintains by bringing in leads with low or no upfront cost.
Referrals are a big source of business for her, and she gets them regularly using one simple trick. Discover what it is by watching the video below.
8. Raise your average sale price
Want to increase your annual profit by 30 percent or more without having to sell more homes? If so, watch this video with Michael LaFido.
Not only does LaFido describe the easiest way to do it, he offers quick tips to help agents make it happen fast.
9. Charge a higher listing commission
30 Under 30 honoree Anthony Manzon has a quick, easy way to boost profits in less than 12 months: Take higher listing commissions!
In the following video, Manzon shares what you must know (and say) to win listings while charging more than the average agent.
10. A six-figure agent’s biggest money maker
Since his first year in real estate, James Festini has made profits in the six figures. In this video, he shares the one thing that brought in more business than anything else over the course of his career.
Want tips for boosting your team’s profitability?
Maintaining impressive profit figures is hard enough as a solo agent. As you know, running a high-profit real estate team comes with an additional set of challenges.
If you want team-specific tips on cutting costs, be sure to catch next month’s profitability post. In it, you’ll find strategies and suggestions from a set of brokers who run highly profitable teams.
Pat Hiban sold more than 7,000 homes over the course of his 25-year career in real estate. Now, he dedicates his time to helping others succeed as agents and investors. As host of the Real Estate Rockstars Podcast, Pat interviews real estate experts to explore what works in today’s markets. He also founded Rebus University, an online training platform for real estate agents and sales professionals.