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Before the advent of buyer agency in 1992, the mantra of real estate agents nationwide was the three L’s: Listings, Leads and Leverage.
The belief was that you could grow a successful business and get leverage as long as you had leads and scooped up listings on a regular basis.
Even today, it’s still sound advice for those who want to have control over their real estate destiny.
That said, there are a few thing you need to know about real estate lead generation if you’re going to become the go-to listing agent in your marketplace.
It’s not brain surgery, but it is important to understand the different listing lead sources out there and which ones you must have to profitably grow your business.
What you MUST know about real estate lead generation
First, let’s take a look at the listing lead sources you must have in your stable of leads to call on a regular basis.
Let me guess, you’re immediate thought is one or both of these:
- There’s a shortage of expireds in my market
- Every agent in the area is hammering them every day
While there is some truth here, it doesn’t mean that you shouldn’t call expired leads. You see, even in a smoking hot market like we’re experiencing right now, at least 20% of the listings taken expire.
Between sellers overpricing their home because of unrealistic expectations and the droves of inexperienced agents who let them do it, a decent number of listings will continue to expire in every real estate market across the country.
The key is to not be deterred by the belief that they can’t be relisted with a new agent.
On average, only 28% of expired sellers will list again with their current agent. What’s even better is that 30% of expired sellers will list with a new agent within 30 days (with most of the remaining sellers re-listing with another agent within 90 days).
The important thing is to call these listing opportunities looking to build a relationship with them that puts you in position to get their listing when they are ready to sell.
Yes, these sellers are going to be angry many cases, but you need to be skilled enough to diffuse their ire and work through it so you can be the listing agent of choice when they do list again.
Whatever you do, don’t let the limiting belief of scarcity about expired leads keep you from making this lead opportunity a solid source of sales for your business.
Remember, you’re not looking to get all of them...just a couple of them a month.
For Sale By Owners (FSBOs)
The good news here is that FSBO sellers are usually open to talking with real estate agents and in a much better mood than expired sellers when you speak with them.
And, despite the fact that they are adamantly opposed to working with an agent, the numbers say they’re better off if they list their home with a competent real estate agent.
Well over three quarters of FSBO sellers will relent and list their home with a real estate agent within 30 to 45 days of trying it themselves.
The labor-intensive nature of selling one’s home oneself, combined with the consistent disappointment of not getting a good offer - or any offer for that matter - weakens a FSBOs seller’s resolve fairly quickly, making them want to give up on selling altogether.
As with expired sellers, you’re going to want to get in touch with FSBO sellers, build a relationship and add value until the sellers are willing to list their home with an agent.
Remember, it’s likely going to get listed. The question is: “Will you be the agent who lists and sells it?”
Circle prospecting, or demand generation as it’s referred to by experts, is the great “equalizer” in the listing lead generation game.
I say that because even if you’re not a beast on the phone, you can still generate some bona fide listing business for yourself with a consistent circle prospecting effort.
What’s even better is that you won’t be in competition with any other agent with many of the listing leads you cultivate from your circle prospecting efforts as most agents won’t even know these folks are selling.
The keys to success in circle prospecting are as follows:
- Have a good data set to call
- Call in areas where the turnover is good (at least 5%)
- Don’t be pushy on the phone
- Make your calls consistently
- Follow up regularly with the opportunities you uncover
If you can do these few things, you can build a legitimate pipeline of real seller leads and be the “only game in town” for these prospects.
In the end, good data and consistency will get you the best results.
Home Value Leads
This lead source is where many agents are missing the boat.
The reason they are is because they call once or twice, hear the seller say: “I’m not interested” and then toss the lead, leaving it for “dead”.
Industry statistics say that 75% of the leads agents generate are treated exactly like this.
This is unfortunate for three reasons:
- Home value leads convert at about 9% annually
- The average home value lead is at least 6 to 8 months away from putting their home on the market
- It takes a minimum of 6 contacts and as many as 12 to 14 in order to effectively convert a home value lead to a listing
This is a real shame because agents can generate an abundance of high-quality home value leads with even a modest online marketing strategy and budget.
Home value leads can be a real game changer for the agent who’s willing to do the necessary work to convert them properly.
And, because you can target where you want your home evaluation leads to come from, they’re one of the best ways to increase your average sales price and become the go-to agent in your area of choice.
In the end, it’s vital that you have a solid listing plan that includes all listing lead types. Counting on just expireds or just circle prospecting will have you missing out on lots of opportunities to grow your business exponentially.
And, if you’re not calling home value leads, you must add that lead source to your real estate marketing and lead generation strategy.
They’ll make a huge difference in your listing business today, tomorrow and well into the future.