In my last blog, I left you with the question posed to me by Loreena Yeo about Jake's success:
"Is Jake running on a stream of good luck? Say, he started in the mid-90s and had his 5 years into early 2001? I do not deny that Jake probably worked very hard. But do you feel that a good momentum for an agent also depends on timing of when he enters into real estate? Would you say that in a down market, that it is probably harder to get the gears rolling? Even for an experienced agent, getting 25 transactions is not easy. What say you?"
Bless your heart, Loreena, you touched a lot of people with your question...
Here is my response:
- The market is certainly different now compared to 1996. Perhaps SELLING 25 homes will be difficult in a world where mortgages are harder to get and far too many homeowners are upside down in their mortgages to price their homes competitively. In Denver in 1996, homes appreciated 15% - 20% a year and any home with a pulse could sell with multiple offers.
However, I distinctly remember rookie agents complaining loudly about how hard it was for newbies to break into the business because all we could get were buyers and there was nothing to sell them. Old fogies, remember those times? Where you checked the MLS hourly to stay on top of the new listings and then fought like hell to get an offer accepted? That wasn't fun either (although it sure kept us busy)!
Also, remember that in 1996 we didn't have 100% loans, FHA was king and buyers didn't qualify for nearly the loan they could qualify for later. Investors typically had to put 20% down, too. Back then, you actually had to be able to afford a home before you could buy it!
Anyway, I digress from my point which was that it MAY be harder to SELL 25 homes in one's first year simply because homes aren't moving. But you should be able to drum up enough business from your SOI to at least put you in the position of potentially making those sales! In other words, you should be able to find 25 motivated sellers and serious buyers to work with. Actually making it to closing might be more difficult (although I'm not convinced - it was tough back then too, for different reasons).
- If not SOI, then what? Are there other methods that you believe will produce a more consistent, reliable stream of business? As you are choosing your prospecting strategies and building a foundation for your future success, do you think that you'll do better with strangers? Whether you sell 10 houses your rookie year or 70, what prospecting techniques FEEL RIGHT to you?
It's not a matter of SOI being a luxury for a strong market. It's a strategy that works, period.
Will you, as a rookie, sell 25 homes this year? Probably not. Remember, Jake was the Rookie of the Year with 25 sales, in a stronger market. So don't fret over that number.
Will an SOI strategy assure every agent who uses it success? Nope. The question is... is it right for you?
I'll answer that next time.
copyright Jennifer Allan 2007