Thursday, December 19, 2013

A Complete Database? What Are Your Stats?

So you have a reasonable database of 250 people or more, you mail to them regularly, you have most of their phone numbers and some of their email addresses, but can you quantify that data?  How complete is your database anyway?  Out of the 250 contacts, how many phone numbers do you have?  How many email addresses?  Or, how about this:  how many of them are your friends on facebook?

Would you agree that a complete database would have a 100% statistic for each of those areas?  If not, what % number would please you?

This would be a great time to analyze your database, calculate your statistics, and set some January or first quarter goals.  Amazing things just might happen in 2014 if you focus your attention in this area.

Friday, October 18, 2013

Three Simple Strategies to Earn Higher Income

Who’s afraid of the big, bad sphere of influence?  Most Realtors.

1.        It is the source that generates the most business for the average Realtor.
2.       Many Realtors procrastinate in making calls to their sphere.
3.       Ironically, their sphere wants to hear from them and would prefer to do business with them.
4.       Three strategies to making the calls:  1) understanding reality, 2) eat the elephant one bite at a time (doing a little each day makes the task easy), and 3) get an accountability partner or coach.

Every year in late fall I meet with agents to talk about their business plan for the next year.  As part of that plan I ask them to source all of their transactions from the current year.  Unless the agent’s main focus is prospecting FSBO’s and expireds, what I find is that the typical agent has most of their transactions being sphere-related transactions:  cousins, brother, friend of my sister, neighbor, mother’s co-worker, etc.  When we add them all up we find that the agent’s sphere of influence contributed to more than half of the average agent’s income.

We realize together that if the agent regularly communicated with his sphere of influence throughout the year, if the agent maintained top-of-mind awareness in his sphere, then his income would likely go up.  We work out a communication plan.  The agent leaves my office excited about the potential to earn more money.  And then what do you think happens?

The agent begins to think that by calling his sphere, that well, he is begging for money.  A link is established between calling his sphere and the money he will get.  Now it feels sleazy and dirty.  He rationalizes that his friends know that he is in the real estate business; his friends will call if they need help.  He thinks, “I don’t want to bother them.”  Ultimately the agent only makes a handful of calls rather than reaching out to everybody he knows.  He chooses the easy calls:  the most recent sales, his mother or siblings, maybe a friend, and then he stops calling.  The income potential has been shrunk because of classic, rationalized procrastination and fear.

Strategy 1
Truth be told, your sphere of influence WANTS to hear from you.  They like you, and enjoy having conversations with you.  You are one of their favorite people.  Not only are they interested in you, but they are also interested in real estate.  They are curious about the market and how it might affect them.  It is this reality that an agent needs understand before they start making calls.  It changes the motivation for the calls.  Instead of being about making money, the calls should be about touching the people who are important to you and possibly helping them.  If, mentally, an agent changes the nature of the call from being one of “generating business” to one where the agent is sincerely interested in the life of the individual they are calling (family, occupation, recreation, dreams), then each call takes on significantly more meaning, and each call becomes easier to make.

Strategy 2
You don’t need to call everybody on your sphere list in the same week or month, you just need to call some of them each week.  Divide your list into 50 weekly allocations.  Maybe that turns into six calls per week, or maybe ten.  Whatever the number it is very manageable – anyone can do it.

But you won’t do it. 

You won’t.  I know it.  You know it.  You will start off with great resolve.  You may be convinced, but you won’t do it.  Life happens, and somewhere along the way, you get off track and fall behind.  When you fall behind, you get discouraged, and quit.  Does that sound familiar?  It does to me.

Strategy 3
An essential part of the formula for success is working with an accountability partner or coach.  When you have to report to someone else besides yourself, you take the tasks in front of you much more seriously.  Your commitment level rises tremendously when you have to explain to someone else the “reasons” why you didn’t complete such a simple task as calling six people you know and talking to them.  Sometimes accountability can come from another agent, perhaps from another office, or from a different part of the country.  Sometimes an agent’s sales director or manager fits the role well.  Sometimes an agent realizes the importance of their personal goals and recognizes the value of hiring a coach.  Would you pay $6,000 to $12,000 over the next year to double your income?  Find a solution that works for you and make the commitment.  It is that important.

Understand that your sphere wants to hear from you.  Make the task manageable by dividing it into smaller chunks.  Find someone to keep you accountable to your commitment.  Act on these three strategies and you will soon be helping the people you care about achieve their dreams, and you will be profitable.

Monday, March 18, 2013

For Love of Customer

Do we love our customers because their business feeds us?  Do we love our customers for their money?  Do we love our customers because they represent our accomplishments?  If so, then we do not love our customers.

Love is not selfish.  It is not proud.  Love is not quid pro quo.

Instead, love is generous and kind.  It is placing the interests of our customer ahead of our own.  To do so requires faith.

Unrequited love is one of our biggest fears.  To love with no expectations requires courage and it requires faith.  If one never takes the risk to love, one cannot be loved in return.  Love becomes more likely and more valuable the more you give it away.

If we love our customers, we will serve them.  We will go above and beyond all expectations because we care.  If we increase our faith, we can love and serve without reward or accolade.  Faith provides that if we love enough, we will be loved.  When our customers sense that we genuinely care, not only will they adhere their loyalty to us, but they will send others to us to receive our blessings.  The extension of faith delivers abundance.

For love of customer we provide compassionate service.

Friday, March 8, 2013

Real Estate Market Watch 2013

In December I wrote this article for a local Chamber of Commerce newsletter.  It is a year end summary of 2012 and a forecast for 2013.  Today, in the early part of March 2013, I see some of these trends taking shape.  I expect them to continue.

These have been tumultuous times for the housing industry.  The bursting of the housing bubble and the prolonged Great Recession have both created an extraordinary challenge for anyone with an interest in real estate.

We started to see positive shifts in the housing market in 2012.  It was the second full year without a first-time homebuyer tax credit, so the organic growth in unit sales numbers is very encouraging. We still experienced a lot of distressed sales which have kept prices flat.  The good news, however, is that prices, for the most part, didn’t decline [exclusive of areas of Milwaukee that were hit the hardest with foreclosures].  In Waukesha County we started the year at about the 2003 pricing level and that is about where we are at today.  In some areas we’ve seen buyer competition for well-maintained homes which has created a little bit of a shortage of listings and somewhat of a demand-pull inflation on prices.

There are signs of encouragement for the housing market in 2013.  Both the words and the actions of the Fed indicate that interest rates will remain low through most of the year.  Pent up demand to buy homes has begun to release and greater numbers of people will act on their desire to own a home or to upgrade.  There has also been a pent up desire by many people to sell their homes to relocate to their retirement destination.  Many will stop holding out for the return of their equity and place their homes on the market this year.

With the tough economy of the past several years there has been a decline in the number of people pursuing a career in selling real estate, but there will be a turnaround in that trend this year.   With sales numbers increasing and prices stable many people who are frustrated with the job market will likely be attracted to the entrepreneurial endeavor of selling homes.

A larger trend that may be significant is the coming of age of the echo boomers.  Also known as generation Y, this group is a larger cohort than the baby boomer generation, therefore, demand for housing will swell like never before.  Echo boomers, so far, have demonstrated dramatically different tastes as it relates to housing, preferring smaller homes, shorter commutes, and more intimate neighborhoods.  However, echo boomers, largely because of the economy, are taking longer to establish their careers and form households.  Much remains to be seen about how they will manifest their housing desires, but in the coming years we may see a growth in gentrification, an in-migration pattern from the suburbs to the cities.  The challenge for cities will be to make their school districts attractive enough to the young parents.

On the business side for us in real estate, our biggest challenge is also our biggest opportunity.  The Great Recession has reduced the intake of new Realtors into the industry to new lows, and retention has been challenging.  However, with much competition weeded out and increasing demand for housing, real estate sales will become a very attractive career choice.  Enterprising young people who have been dissatisfied with limited opportunities in the job market stand to make substantial profits by helping their friends find quality housing for their new families.  Also, you can expect the home remodeling industry to see tremendous growth in the next ten years, as this generation modifies their dwellings to fit their tastes.

Trading of housing, however, isn’t something that people really time with the market.  It is a basic human need timed more appropriately with life circumstances.  When people get married and have children they tend to want to own a home of their own in a good school district and pleasant neighborhood.  When children grow up and move out of the house mom and dad no longer need as much space.  Death, divorce, job transfers, job promotions, the birth of grandchildren and the desire to be near them; these are circumstances that give reason to buy or sell homes.  These life events happen in good economies and bad, when interest rates are low or high.  Housing is a quality of life issue as much as it is a financial issue.

Our homes are, in part, how we define ourselves and that has a lot to do with the people in our lives, the people we want to be close to.  Buying a home will once again be about planting roots rather than harvesting profits.  When approached from the right perspective there has never been a better investment than owning a home.