A real estate business deals with the buying, selling, management and guide in 2022
How to Plan, Start, & Grow a Real Estate Business:
Starting a real estate business ain't for the faint of heart. What other industry requires you to cold call dozens of leads every day — only to close approximately five deals in your first year (if you're lucky)? It’s a common adage that 3 out of 4 real estate agents fail within the first five years. But for those who have what it takes, starting your own real estate business can absolutely give you the seven-figure job of your dreams. Free Resource: Real Estate Strategy Template. Here's a candid look at how to start a real estate business, plus our best advice for avoiding mistakes that hijack momentum as you grow. For many new agents, real estate is their second, third, or even fourth career. You loved the idea of "being your own boss" while making more than you did at your last job, but freedom has a very different meaning for an employee versus a business owner. The first thing you need to know about starting a real estate business is that, yes, this is a business. Whether you're a solo agent or new to a team, if you have dreams of outperforming the average real estate agent salary ($41,289 per year), you need to start thinking like a business owner — and that means planning.
1. Get a CRM.
At the end of the day, a business is a system. Barry Jenkins is the broker-owner of the #2 Better Homes and Gardens Real Estate Team in the United States. He's also a guy who hates inefficiency. "I, to a fault, like to make things easy. The reason my business is so successful is that it was built on the core principle of leverage." Using a CRM to achieve boss-level organization is how Barry and his team sold 240 homes in 2017. And it's not all about the front end, either. Barry also uses his CRM to send automated onboarding drips to new team members and keep the business admin completely streamlined so that nothing important ever falls through cracks.
2. Craft your ideal personal plan.
Before you set the right financial goals for your business, you need clear financial goals for your life. Commissions are great but — let's face it — we all came into this business wanting something bigger and better than what we have right now. Whether that's the 187-foot yacht of your dreams or the ability to leave the office at 2:00 p.m. so you can pick up your kids from school, take time to think through what your ideal life would look like.
3. Align your business plan.
Now that you've put pen to paper to figure out exactly what your biggest, most anti-paycheck-to-paycheck life looks like, it's time to talk business. Start writing your business plan, paying special attention to the things that set you apart from the other real estate businesses in your area. Give it some real thought. This is where your personal and business identities can really come together to make profit-driving magic.
4. Build a consistent marketing plan.
In the beginning, it was all about passing your licensing exam, selecting your best-fit brokerage, and building up your database without coming across as "salesy" to the friends and family in your Sphere of Influence (SOI). But kicking back and coasting as soon as the referrals start rolling in is one of the biggest mistakes growing agents make. Whether your dream is to become the next Facebook ads guru or a master of Zillow conversions, the only thing you really need to know about marketing is that it's the one part of your business that never sleeps. Train your brain how to think strategically about what's happening in your market and be ready to offer something of value to your leads, no matter where they come from.
5. Get a website.
For 44% of all buyers, the very first step they take in their home search is to look online. No matter how much local marketing you do, you need a web presence to attract and engage online leads. It may cost a little money upfront, but a solid, SEO-focused website that lets you integrate IDX listings and usher those leads right into your CRM is a crucial foundation of every successful real estate business.
6. Prospect consistently.
Shiny object syndrome is a big problem in real estate. But the most consistent agent always wins, so choose your prospecting system and stick to it. In the early days, it's never a bad idea to optimize your SOI. In fact, the Atlanta-based Graham Seeby Group transformed a list of just 279 contacts into $90 million in home sales in just four years by consistently marketing to their past clients and sphere. "We focused on the ‘mets’ in our database and it was amazing the volume of transactions we started doing right out of the gate! For example, we did $2 million worth of sales from one couple I hadn’t talked to in 13 years. I mailed them a postcard, because I was afraid to pick up the phone and call them. I didn’t know if they’d know who I was. When they got the postcard, they called me. They ended up spending $1.2 million on a new house and selling an $800,000 house."
7. Nurture leads.
If a lead contacts you, they expect to hear from you.
Mike Pannell is a master lead generator and the leader behind Nu Home Source Realty. According to Mike, a follow-up system is crucial to long-term lead conversion. "I tell my agents that 70% of people are not going to buy for 180.5 days. If you’re waiting on those new leads to buy, you’re only going to close three percent. That will make you enough money to survive, but your goal is six months and beyond. You’ve got to follow up to get to those; you’ve got to build that pipeline to get to those people." In addition to avid blogging and website optimization, Mike also checks up on the competition to see what's happening on the ground in terms of follow up. "I sign up on a lot of different websites out there. I don’t give them a real name, but I give them a real phone number. And I can tell you what, I don’t get a lot of calls."
8. Have good time management.
If you're like most of us, a big part of the dream is to have more time and energy for the things that really light you up. But most agents who set out to build a real estate business haven't built that into the plan. They end up with a revolving door of team members and have to roll up their sleeves and try to outwork the business problem du jour. But it doesn't have to be that way. For experts in automation, a motivating factor is saving time. By eliminating manual work through automation, you can free up time to focus on the activities that actually drive revenue. The ability to do marketing automation further underscores your need for a CRM, which ends up acting as the engine that supports your efforts.
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