Recent Surveys have shown that while many agents are suffering in the changing market, there are a huge number who are doing better business than ever before. What's the difference for those that succeed and those that fade away to the land of the formerly licensed? A firm grasp of the basics.
We always want to find the "Magic Bullet"- A pill that causes weight loss regardless of how many McMeals we choke down; The secret formula that reveals what cards the dealer will toss out at the poker table before he even shuffles the deck; And my favorite, the no cost, no effort, infinite return lead generator for real estate agents (I'd like to have the patent on that). What studies and interviews with top producers has revealed, however, is that it's the basics of real estate that generates the returns.
When the market shifts, it's the early adapters that thrive, and those who get a late start mearly survive. But its the cold calls, consistent mailers, and regular follow up that creates your market presence and establishes you as a lasting agent to the lead. Know what your market is doing and adjust accordingly. Taylor your efforts to the conditions you face, and hold the costs of those efforts accountable for the return.
John Q. Agent has had it pretty good the last few years. He spends about 1/2 of his commissions on direct mail campaigns and gets a close from his farm every couple of weeks. The rest of his efforts are inexpensive, but uncomfortable, and so he only cold calls when he's got nothing better to do. He's never knocked on the doors in his farm, but that's OK, he's still doing alright. Between his farm, the occasional referral, and a few calls on his 800 number, he's made a fair living. About 6 weeks ago, the market shift really started to get noticeable. John's sales started coming further apart... 7 weeks, than 8, and right now Johns only got 1 listing and nothing in escrow. His own bills are coming due, and so, needing some income, John thinks to himself, "I need more leads. More leads turn to more clients, and more clients equal more closes."- A logical chain of thought. So John dumps his meager savings (he's been blowing a lot of money on a non-cost effective generator that has at least kept him going, remember?) into a new direct mail farm, adjacent to his current one, hoping for more returns. But the market has changed, and the audience of people who are buying and selling has dwindled to only those who need to buy or sell. Gone for a while are the days of people listing their home because they don't like the color of the carpet anymore. John still doesn't have the closes to keep up on his overhead, and so he takes the equity from his home to float his business... And that runs dry. While flipping through the newspaper, looking for a part time job, John comes across an open house ad for Suzie D. Pro, and it's in HIS FARM! He's heard of Suzie, she's from his office. She just got her license at the start of the market down turn, and in fact, he had made a comment to another agent friend of his the "She wont last". Curious about the home Suzie's holding open, John goes to his MLS and looks her up, only to find out that she's got 12 listings in his farm. HIS ORIGINAL FARM! Plus about a dozen more around the county into the other side of the county lines on all sides.
What has Suzie D. Pro done that John Q. Agent hasn't? A lot of things. She's walked the farm. Knocked the doors and made the cold calls. Held every dollar she spends accountable for a return. Dumped the costly lead generation techniques that did not justify their own expense, and focused on the basics of real estate. John held on to a business model that was out dated and no longer relevant to his market. In this, Suzie had the advantage- She knew no other market and had not gotten the opportunity to grow lazy and complacent with her business, and as such will excel in the changed market and thrive the next time it swings the other way.
The long and the short of it is that every market has it's opportunities, and it is the basics of this business that help us find them. If they didn't work, and work well, they wouldn't be the basics. There really is no such thing as a bad market. When the market is a strong sellers market, its pretty bad for buyers. A buyers market in turn is great for buyers and lousy for sellers. Examine your business model, hold your budget accountable, and any market will be a great one for you.
Here's to your continued success!
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