There are two ways to become profitable in this business: Increase your revenue and reduce your expenses. Most agents focus only on the “make more money” part of the equation. However, reducing expenses is another important profitability factor.
Below are seven powerful insights that address both increasing revenue and reducing expenses so that you can make this year one of your most profitable.
1. Focus on low-hanging fruit in your local real estate market
Listen, these folks need you now more than ever. Why? Because even in those markets that are still red-hot seller’s markets, the need for homesellers to protect their interests and return on investment and negotiate like a pro is strong.
Ever hear one of them say, “Bring me a buyer, I’ll pay you a commission”? What happens when more than one agent brings them a buyer that puts in an offer and the FSBO is inexperienced with multiple-offer situations and ends up “selling their home twice”?
There are a lot of reasons FSBOs should not be FSBOs — the top of which is that agent-assisted homes sell for more. Here’s my tip when prospecting both of these niches but especially FSBOs: Get past the first 60 seconds when you first call them.
It’s almost like they are trained to be aggressive in that first minute, but if you can ride that wave, make it about them, compliment their house and their efforts, and ask questions about what their goals are — you can make it through the rest of the conversation and create an opportunity to help serve them by making an appointment to see the house.
From there, knock their socks off with a strong listing conversation about how you can help them get more in less time — with fewer headaches — and help them move onto the goals they are committed to.
2. Connect with past clients, family and friends — better known as your ‘sphere of influence’
Your sphere includes people who know you, trust you and would do business with you, and they are an amazing source of referrals — if you stay in touch and top-of-mind and committed to nurturing these relationships.
According to a National Association of Realtors (NAR) study, 68 percent of sellers who used a real estate agent found their agents through a referral by friends or family, and 53 percent used the agent they previously worked with to buy or sell a home.
Here’s the trick — don’t try to schmooze them or sell them. Especially them. These are the folks who will create the referral foundation that can last decades when done right.
Not surprisingly, during tough times for real estate agents, it is leaning in and taking care of your sphere where you will not only find new business, you’ll also find relationships that sustain you, inspire you and motivate you to serve more.
3. Ask for ‘orphan’ leads
Ask your manager for the client files of agents who have gone to another brokerage or retired from real estate. Call them, and introduce yourself as their new contact at your company. Let them know that you will be your company’s representative for them should they have any questions about this crazy market and what it might mean for their homebuying and selling needs.
You don’t always need to spend money to make money. If you don’t have the money to invest in a consistent farming campaign or advertising, there are many ways to brand and market yourself for little or no cash investment, such as:
Pick up the phone
It will be one of your best allies if you allow it to be. If you can get past the fear of prospecting and make it your mission to pick up the phone at least three or four days a week for at least an hour a day, you will get more business, coming from a place of service.
Your commitment should be building a relationship, finding out their commitment and leaning into how you can help — not just “taking” a listing appointment or listing.
Become an advocate and a resource in your farm area’s Facebook group
Most of you have neighborhoods you want to market that have a closed group online. Spend 15-20 minutes a day or every two days to make friends, be a resource, come to people’s aid and take an active part in the community.
The rule of thumb is for every six contributions, share one real estate tip or tool. Keep it conversational. Help where you can. You’ll be rewarded.
4. Host open houses
This is an extraordinary way to build business, from helping new buyers to finding new folks in the neighborhood who have been thinking about selling. Have constructive information of value to offer and follow up, follow up, follow up.
5. Don’t pay for real estate leads unless you can afford them
The truth is, not all purchased lead sources are good, reliable ones that have a return on investment. If you don’t have the money to gamble on trying a lead source for at least three to six months, then rely on the “no money” options above.
When (and if) you feel like you are ready to branch out into that investment, first do your research. Ask around in your agent communities to find out what kind of experience others have had so that you don’t waste time on duds.
Know that there are top producers who spend tens of thousands on leads a month and others who pay little to nothing and make a very good living. Decide what’s right for you.
6. Look for foundational investments that pay off
I don’t believe a real estate agent can survive long-term in this business without a serious customer relationship manager (CRM). There are too many moving parts and the importance of staying in touch and top-of-mind has never been greater. A CRM is the only way to ensure that things have a chance of not falling through the cracks.
7. Turn one listing into many
How do you do this? By spotlighting the listing, the market conditions, the quick sales and even the multiple offers through mailings, door-knocking, open houses and neighborhood prospecting. Pro tip: Be the first to call and communicate with neighbors in an area where there is a new listing — even if it is not yours. Start the domino drop!
The bottom line is that you need to pay attention to your bottom line this year. That means sticking close to high-priority activities like these. Focus, mindfulness and a commitment to service will all serve you when you do.