Real Estate Economics Lesson 101: TANSTAFL (There Ain't No Such Thing As Free Lunchs"!

By
Real Estate Agent with Progressive Realty (Boise Idaho) www.Progressive-Realty.info DB-17066

I have been reading several blogs today about how Realtors attempt to get real estate leads.  It is amazing to see the lengths that some agents will go.

  • Open Houses;
  • Floor Time;
  • Pay per click ads;
  • Subscribing to lead generation companies;
  • Buying advertising on websites or print media;
  • Buying your "zip code" territory on websites;
  • etc.
Each of these will have varying degrees of success. However, my first real estate broker taught me a very valuable lesson 19 years ago here in Boise, Idaho - "The harder you work, the luckier you get"!

Before you pay for leads or "invest" in lead generation tools, you really need to learn how to handle the lead once you get it so you can close it!  For example, are you prepared for a lead when it pops in?  Here are a few suggestions:

  • Open Houses (have switch properties printed and ready with your contact data on them);
  • Floor Time (know your company inventory and know have 2 or 3 times blocked to show homes);
  • Pay per click ads (know the sites these will be on so you know who the potential customer may be);
  • Subscribing to lead generation companies (generally, skip this step if you have to pre-pay);
  • Buying advertising on websites or print media (have your flyers and email responses ready to convert);
  • Buying your "zip code" territory on websites (do your research on the zip code so you become that expert) before you invest);
Before you spend your time and money, take a look at your marketing from the consumer's perspective to see if there is enough of a call to action or sense of urgency to have them pick up the phone or click on your ad.  Look at what these lead generating companies are doing and look if you can hire someone to do it directly instead to save you money and give you greater control!  (For example, you probably get multiple calls a month that "promise" to get you the #1 page or #1 listing on Google/Yahoo, etc.; but in reality they are just buying "adword campaigns" and marking them up to resell to you!

I am starting to write simple "how to" policies like this for my real estate company in Boise, Idaho called Progressive Realty Corporation, so if you like what you see here, feel free to subscribe to my blog.  Your comments are always welcome! 

Comments (4)

Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Jim, great advice, you need to know how to close, so part of your  policy writing could cover formulas and number of leads given and closed i.e.: closing percentage:)

Sep 02, 2010 09:20 AM
Deborah Byron Leffler BzyBee Real Estate Lady!
Keller Williams Realty Boise - Nampa, ID

Great tips for sure!   So many want leads but are baffled when they get them!!!

Sep 02, 2010 09:23 AM
Mike McCann - Nebraska Farm Land Broker
Mike McCann - Broker, Mach1 Realty Farmland Broker-Auctioneer Serving Rural Nebraska - Kearney, NE
Farm Land For Sale 308-627-3700 or 800-241-3940

Jim...I learned the hard way about the pay per click companies...or the pay for leads companies....I paid for dozens of Mickey Mouse leads...I was only aware of a few Mickey Mouses....I did not realize how many Mickey Mouses there were in the US.

After 2 years and 2 great sales from it, I netted a grand total of -$3,200.00 that is negative.

Open houses, floor time, on call, handing out flyers in a neighborhood, chamber of commerce, community involvement, church, school, etc all worked for me...elbow grease work  - worked.

virtually any type of purchased advertising did not work and wasted thousands of dollars.

 

Sep 02, 2010 09:24 AM
Jim Paulson
Progressive Realty (Boise Idaho) www.Progressive-Realty.info - Boise, ID
Owner,Broker

@Endre, you are right on tracking conversion rates!  I remember covering that in one of my CRS classes over 10 years ago (number of calls to get to the appointment, then how many appointments to listing, how many listings to get to a sale, factored by how many fall through, etc.)  Great basis for a business plan!

@Deborah, I used to laugh (under my breath) when I would listen to how some agents would handle floor calls.  (i.e. Sorry, that one is sold and the agent hangs up before the potential buyer)!  I commend you for being an AR agent in Idaho (Active online Realtor - not just here on AR)! 

Sep 02, 2010 09:28 AM

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