S9 E1: How To Get Real Estate Leads In Today’s Market
Getting real estate leads in today’s market. That is what we’d all like to learn more about, right? Why ‘unfair’ share? Because so many do not understand how! “We’re moving out of a speed-based market, and transitioning into a skill-based market.”, says co-host Sarah Close of KWA, Cincinnati, OH. Which is great news for agents who have been focusing on the fundamentals all along!
Vulcan7 CEO Ren Jones and Sarah Close of KW Advisors (Cincinnati, OH) have alot of experience when it comes to weathering many real estate market shifts, and have done so successfully over the years.
“We’re in a bit of a changing market, which can be an exciting and huge opportunity for those real estate agents who figure out what the strategy is.”
“You have to use a formula, it’s a recipe! This is very much a contact sport, you NEED to be talking to these people in a very disciplined way, and help only the one’s that need help now, and nurture the one’s that don’t.”
“You’re going to see a very big change in the real estate herd, I think, between the amateur’s and the professionals, and teh professionals are going to take advantage of this market, make changes, and be agile in their business to increase their market share. And we all know that market share that is gained in a changing market, is market share that is not lost.”
Watch now to learn more about this recipe for success, and how you can strategize to take your unfair share of leads in this market…..
Ren Jones (00:05):
You’ve done that many, many years, Sarah. I’ve done that many, many years, taking 6, 8, 10, 12 listings a month with ease every week.
Sarah Close (00:12):
That’s exactly right.
Ren Jones (00:12):
You just take two or three listings every week for years, so these things can be done.
Sarah Close (00:18):
And it’s more-
Ren Jones (00:19):
But you have to use a formula. It’s a recipe. It’s a contact sport, folks.
Sarah Close (00:23):
Very much a contact sport.
Ren Jones (00:25):
And you need to be talking to these people.
Sarah Close (00:27):
Ren Jones (00:27):
And if you’re talking to these people in a very disciplined way and helping only the ones that need help now and nurturing the ones that don’t, staying in touch with the ones that won’t and following them along. But don’t put too much effort into following along, keep getting new ones.
Sarah Close (00:40):
That’s all right. Yeah. You can.
Ren Jones (00:42):
Because that next 10 people you talk to, one of them needs you now.
Sarah Close (00:45):
That’s exactly right.
Ren Jones (00:55):
It’s that time. Welcome to Roadmap, how to take three listings a week until you’re ready for more. Each week we interview a great agent who’s consistently taking several listings each month and you get two, two for the price of one. We encourage you to take notes and apply as much of the knowledge as quickly as you can, and then use the copycat principle. So my co-host and I are going to help you get your unfair share of business in a changing market. We’re in a changing market. Let me introduce my co-host, Sarah Close. Hi, Sarah Close.
Sarah Close (01:32):
Hi, Ren. Thanks for having me today.
Ren Jones (01:34):
Sarah owns and co-owns several real estate offices in Southern Ohio, and does a fabulous business and has a team who also sells a lot of real estate. What’s the goal for the sales this year and the team?
Sarah Close (01:49):
The goal is 250.
Ren Jones (01:50):
And you’re tracking 250?
Sarah Close (01:52):
We’re tracking a little behind, but we’re getting caught up.
Ren Jones (01:55):
All right. Well, there you go, so that’ll be a lot of fun. So today, one of the things, we’re in a bit of a changing market, which is exciting.
Sarah Close (02:03):
Ren Jones (02:04):
There’s always a huge opportunity when a market changes, and we have a little bit of a upward pressure in interest rates and it’s got people looking at this very differently. And real estate agents that are on the ball, just like you remember when Covid started, those agents that figured out what the strategy was had an amazing business.
Sarah Close (02:23):
Ren Jones (02:23):
Well, guess what? At times like this time, it’s changing again. And we wanted to go over how to get your unfair share of business in this wonderful market.
Sarah Close (02:31):
Ren Jones (02:32):
Because it’s a little different strategy, so we wanted to go over that, so take notes. Take notes. Don’t just think you’re going to absorb it all. Write these things down and then go apply them and then reach out to us in about two months and tell us how it went.
Sarah Close (02:48):
Ren Jones (02:49):
What do you think, Sarah? You have how many agents in your company? Is it 550, 580, somewhere in there?
Sarah Close (02:55):
Yeah. We’re just a little under 550.
Ren Jones (02:56):
All right. Okay.
Sarah Close (02:56):
And our market, as Ren mentioned, covers kind of the Southern Ohio area. We have agents that work in Ohio, Kentucky, and Indiana. And we’re seeing the same things that we’re hearing everyone is seeing nationwide. And obviously, the real goal is to make sure that we stay on the right side of the news. And anytime there’s a shift in the market, there’s an opportunity for agile agents to make adjustments to their business to assure that their goals are not impacted by the market, but rather their business strategies are directed by the market conditions that are out there. So it’s a bit of a mindset and it’s a bit of a focus that the news isn’t happening to you, it’s how you’re responding to what’s actually going out there.
Ren Jones (03:44):
Exactly. And keep in mind, and everybody out there knows that. The news is designed to upset you because if it didn’t, you wouldn’t watch.
Sarah Close (03:53):
That’s right. No eyeballs over time.
Ren Jones (03:55):
So you know that the headlines are misleading, and you can get into it. And even the headlines and even the story can be sensational but not necessarily an accurate picture.
Sarah Close (04:04):
Yeah, absolutely. Absolutely. We’re moving out of a market that I would call maybe a speed-based market, where the agents that were thrown up a lot of units were often the people that could get there first to make sure their client got into the auction for that particular house. And we’re transitioning, and I’d say we’re transitioning very quickly, to a skill-based market. And all of the fundamentals that we talk about career-long, I would say season-long, but career-long are really coming back into play, and that is great news for professional agents.
Ren Jones (04:40):
It certainly is, because if it had continued much longer, as we’ve seen when it goes a really long time like this in the past, then there’s commission erosion because they don’t think they need your help.
Sarah Close (04:50):
That’s exactly right.
Ren Jones (04:51):
They will use some discounted services because they need your help, but they don’t.
Sarah Close (04:56):
Ren Jones (04:56):
Now they actually-
Sarah Close (04:59):
If so many people are needing to move and get there and move, that certainly diminishes a little bit of the value, at least in the eyes of a consumer, that the agents, the professional agents, are bringing to the table. So you’re going to see a very big, I think, change in the real estate agent herd between the amateurs and the professionals. And the professionals are going to take advantage of this market, make changes, and be agile in their business to increase their market share. And we all know that market share that is gained in a changing market is market share that’s not lost. So it’s a really opportunistic environment if you’re ready to take advantage of it.
Ren Jones (05:40):
It certainly is. And this is the time where we have to do a lot of homework. We have to study specifics. You can’t speak in generalities. You can’t say, “Oh, Mr. Seller, Mrs. Seller, the market has slowed down.”
Sarah Close (05:55):
Ren Jones (05:55):
They watch the news too, and it has and it hasn’t, so we need to be very exact in what we say, very specific because it has and it hasn’t. If you, as an agent, if you’re working mostly buyers, you do feel a slow down, because the pool of buyers, the 25 people that would make an offer on one house, now it’s only nine people making an offer on one house. Now, if you’re on the listing side, you don’t notice as much. It takes a little longer and you have to price it a little better. The greed sales are not necessarily selling like they were.
Sarah Close (06:29):
Right. That’s exactly right.
Ren Jones (06:29):
Just normal priced houses are selling, so if you’re on the listing side, it’s not so bad.
Sarah Close (06:37):
That’s absolutely right. Yeah. If you think about the key to a business being listings, you know hear the phrase, we’ve all heard it, “list to last” and all of the jingles that go along with the efficacy of listing, it’s not because it’s false, it’s that it really makes an enormous difference right now. Not only is that… When you have a healthy listing inventory that we now all have the opportunity to achieve, that maybe earlier when inventory was half a month on the market, we’re going to have an opportunity to get a robust listing inventory. And that’s also besides being all the soldiers out there for you doing a side, when you’re on the listing side, you see that background information that you don’t get to see necessarily if you’re just on the buyer side.
So for example, if a property sells at full price in three days, and maybe three months ago that would have brought 15 offers that had appraisal gaps and no contingencies, I’ve got one set of data. If I’m the buyer, all I’m seeing is that final price. If I’m representing that seller and I have that same listing now, and I only see one offer come in, but I’m still selling at the same price that the buyers are seeing, I now can understand that change and that nuance to the market that would otherwise would be blind to me if I’m not really participating on the listing side to be able to see in full daylight all of the details of that activity level.
Ren Jones (08:11):
Wonderful. And if we can encourage, in a variety of ways today, how to spend more time on the listing side, get there in a routine way and not just accidentally because your buyer needs to sell to buy.
Sarah Close (08:23):
Ren Jones (08:24):
So let’s take a look at one thing. Let’s look at supply, because we’re saying that the supply’s improved, sort of.
Sarah Close (08:34):
Ren Jones (08:36):
If you look at it, okay, so what you have, this is the last 12 months. It got down to 1.6 month supply in January and it’s back up. It started a year ago at about 2.5, it’s up around 3 now, the latest data from the Fed. But it’s showing it at around three month supply.
Now, people are like, “Oh, three month supply. What does it mean?” Well, think about what that means. That means a normal market, where it’s not a buyer nor a seller market, is a six month supply. So we are still heavily in a seller’s market-
Sarah Close (09:13):
Ren Jones (09:13):
… at 3, which is a delightful number if you’re a listing agent.
Sarah Close (09:17):
Ren Jones (09:18):
It’s a delightful number if you’re a listing agent. So you want to be on the delightful side of the business. If you’re on the buyer side, it’s still not a happy number because there are less buyers and there’s still not much supply.
Sarah Close (09:32):
Ren Jones (09:32):
But that makes it a little easier. But there are less buyers out, so that could be a wash there, I don’t know. But generally speaking, get on the listing side, buy a little insurance here.
Sarah Close (09:44):
Yeah. No, that’s good advice. And at the end of the day, the primary source of our business, our databases, it never changes. That is the absolute cornerstone to every professional agent’s business is their database. And when we are in a market that is changing, and Ren, I like that term greed seller, we don’t really see that happening right now. But when we are in a market that is starting to change, if our database was producing a specific level of output, in a heated market, it’s reasonable to assume that that same database cannot produce that same level of output as things start to change. And so, a real key and a real focus in every agent’s daily routine needs to be not just communicating with the existing database but adding to that database.
Ren Jones (10:34):
Right. Your database rules. That’s huge and very important. And in the last three or four years, many people have stopped feeding the database because it was producing enough, and you have to keep feeding it with the people you don’t know to the people you know. And the people you don’t know that you want to be talking to and adding to are, they’re part of the core. They’re getting married, they’re getting divorced, they’re moving, or somebody died. That’s the core business. And there are some others too, but finding the people that plan to sell their home or were trying to sell their home and don’t have a real estate agent. So if you go after those targeted areas, you can in a very predictable way, take two or three listings a month. And if you’re already doing that, take a couple more a month than you’re taking now per month, because some of you are taking 5, 6, 8 a month now, congratulations, but adding to that and really having a fabulous year.
Sarah Close (11:39):
Ren Jones (11:39):
So that’s where we want to spend our time is adding, going after those people you don’t know that have an immediate need. And being the market expert, because if you have the statistics and the microcosm is where we are the safest and strongest, if you can zero in on this little part of town, whatever that little neighborhood is, Willow Glen or whatever, and there’s 5,000 homes there or whatever it is. I’m not saying do geographic farming, but whatever your part of town is, you can have a microcosm of statistics that you say, “There were 87 homes that sold there in the last 30 days.” Now historically, in the last three years, it’s been 95 and now we’re at 87, still a very good number, whatever. Or, “It’s taking 13 days on average to sell and it was taking nine, so it’s not off by much.” You need to be very exact with people, and then they will embrace you as the authority.
Sarah Close (12:34):
That’s exactly right.
Ren Jones (12:35):
If you speak in generalities, they’re like, “Well, she watches the news, he watches the news.”
Sarah Close (12:40):
Right. “That agent’s not telling me anything.”
Ren Jones (12:41):
“You’re not telling me anything I can’t guess.”
Sarah Close (12:44):
That’s exactly right. Yeah. The phrase that we will hear a lot of times thrown around is “being the local economist of choice. And that doesn’t mean that you need to whip out the Wall Street Journal and digest that every morning. But what it does mean is that, as Ren, as you’re suggesting, that you are very intimate with those granular details in the market that you want to be known as the professional in.
And that idea of mind share, if you’ve got deep mind share with a very narrow group, the likelihood of them looking for another professional outside of your presence is greatly reduced. And as we’re thinking about market changes, that is a huge efficiency. If you can list a house down the street and then pick up one on the cul-de-sac, if you think of the efficiency in that, it’s a huge game changer, if you will, for really getting a very dialed in focused business. It’s go big by getting really small, and then working gradually out from there.
Ren Jones (13:47):
There’s a great stat resource that one of our Roadmap guests a couple weeks ago mentioned is, he has his agents go to Mortgage News Daily and watch, because the information available makes you a market expert. One of the things, because you won’t hear good news in the news. You’ll hear when it goes up. You won’t hear when it goes down. Anybody think mortgage rates have gone down? Well, they did. Okay?
So take a peak of this. So if you look at it, a month and a half ago, the rates were up about, it was like 5.89. Now they’re at 5.30.
Sarah Close (14:31):
Ren Jones (14:31):
That’s off of Mortgage News Daily. And there are all kinds of articles and news and things, housing news and stuff like that. You can be an expert in this, and you need to have those resources at your fingertips. Your local MLS, unfortunately, you almost need to take a class in doing it. But most MLS systems have great stats if you can figure out how to use them.
Sarah Close (14:54):
Ren Jones (14:55):
And if you know somebody that can help pull those reports for you, that can be a valuable tool as well.
Sarah Close (14:59):
Absolutely. Yeah. I do think that we have, at least I know in our area, the staff that’s at our MLS is extremely skilled in how to use and manipulate that data, and frankly, very willing to walk someone through what that looks like. So the MLS data is extremely rich. And there are also a lot of kind of overlays like broker metrics is something that we spend a lot of time with. That’s a service that takes MLS data and puts it into charts and graphs. But just knowing where those are, being very familiar with how you’re going to tell your number story is very critical.
Ren Jones (15:36):
And for many of us, it’s not in our DNA to do that, so just ask somebody that that’s in their DNA to pull reports like that and is very fluent with those sort of things. Or call the MLS and say, “Hey, how can I get this stuff without taking a course on how to do it?”
Sarah Close (15:51):
Ren Jones (15:52):
Because if you have that information and you can just say a few sentences that are really solid numbers, they’re going to be attracted to you because they know you know specifics and you can protect their equity in this process.
Sarah Close (16:07):
That’s right. And help them understand what those metrics mean. Not just, “These are the metrics,” but, “Here’s what this means to you,” and being able to help them apply that. Because ultimately, our job as an agent is to help the consumer make an informed choice that will help them reach their goals. And we can’t do that if we can’t provide the information that supports the knowledge of the market conditions. That’s why we’re there. That’s why they hire us. So it makes a big difference, being able to articulate that.
Ren Jones (16:39):
Absolutely. So we have to… When you’re looking for people, you’ve got to find the ones that are ready now. “I can only help you if you’re ready to buy now. I can only help you if you’re ready to sell now. We can stay in touch, I can update you, but price is a moment in time. The market is a moment in time. And when you’re ready, we can help you.”
Sarah Close (17:02):
Yep, absolutely. So it’s communicating with your database that you understand what’s going on in the market so that you can help them make those decisions if they’re having a life event. And for all the regular reasons that we’re curating those relationships, to be of value for those clients. And as we were saying before, it’s adding to that database.
And there was an interesting kind of study that was done by a group out of Tampa, Gene Rivers, who runs a very successful business there. They discovered that prior to the last shift, at least in their team, they were seeing that contacts to closings was about 24:1. They then tracked it during what we would call the last shift. They found that that number went to 34:1. So that’s actually, that’s not just 10, that’s a 42% increase in the amount of outgoing lead generation energy that that team needed to expend to get the same number of closings. So when we’re thinking about our database, that’s part of the reason why it’s so critical to really stay focused not just on our existing database, but on perpetually adding to that so that we’ve got that garden that we can harvest from.
Ren Jones (18:10):
So if you’re communicating back and forth with 24 people a day, you need 10 more a day.
Sarah Close (18:19):
Ren Jones (18:20):
And if you’re only doing 12 a day, yeah, you’re going to need 18 a day to make that number.
Sarah Close (18:26):
That’s exactly right.
Ren Jones (18:27):
Or 17 a day.
Sarah Close (18:27):
That’s exactly right.
Ren Jones (18:28):
From 12 to 17 to make that number happen. So run the math, calculate that. Those are good numbers. So again, it’s 24:1 in a great market, 34:1 to a piece of business, 34 conversations or contacts to one closed transaction. Is that correct?
Sarah Close (18:46):
That is correct. Yeah. And at least that’s the information they had. But Ren, I know one of the things we talk about a lot is being very dialed into your own individual numbers. And now is the time to get very specific and very purposeful about tracking where exactly is your business coming from, so that you can really laser focus your efforts on those streams of leads that are most effective for you.
Ren Jones (19:09):
Right. Because your numbers aren’t your numbers. And I was talking with Sarah about that. For example, I know plenty of people that can talk to 8-10 people a day and set one or two listings appointments.
Sarah Close (19:24):
Ren Jones (19:25):
And then, you have people that talk to 8-10 people a day and they may not set one appointment all month. So who you’re talking to and your skill level.
Sarah Close (19:33):
Ren Jones (19:34):
Your closing level. So it’s important to go where the fish are biting. It’s an old fishing rule. When you’re going out on the lake, go where the fish are biting, number one. Number two, bring a lot of skill. You can’t put just any old hook and line in the water. Bring some skill, bring the right bait, bring the right skill to the whole process. And that is the copycat principle. People that watch this Roadmap show, if you do what they’re doing, you’ll get what they’re getting. And we have plenty of people that are taking 6, 8, 10 listings a month.
Sarah Close (20:07):
Ren Jones (20:10):
You’ve done that many, many years, Sarah. I’ve done that many, many years taking 6, 8, 10, 12 listings a month with ease.
Sarah Close (20:16):
That’s exactly right.
Ren Jones (20:17):
Every week, you take two or three listings, every week for years. So these things can be done, but you have to use formula. It’s a recipe. If the recipe’s off, it doesn’t work.
Sarah Close (20:30):
That’s exactly right. When I look back at some of the historical numbers and in our marketplace, primarily with Cincinnati kind of being the center of that, our weakest year was 2011. And in that year, we still had about 32,000 real estate transaction sites. So I think it’s very important to remember that even when we’re hearing about a market change, that the amount of business that is still available for professional agents is more than enough to reach your goal.
Ren Jones (20:59):
Okay. Make that relative. So 32K in a bad year, what was last year?
Sarah Close (21:05):
Last year we had about 27,000 units, so call that, what? 4,000 sites?
Ren Jones (21:11):
54 over 32. Okay.
Sarah Close (21:13):
Ren Jones (21:13):
So it’s still about 65, two out of three.
Sarah Close (21:15):
There’s a lot.
Ren Jones (21:16):
Two out of three. So you just have to do one and a half times what you’re doing to get what you’re getting. So really it’s just about…
Sarah Close (21:25):
It’s a math problem.
Ren Jones (21:26):
It’s a math problem. Right. It’s a contact sport, folks.
Sarah Close (21:30):
It’s very much a contact sport.
Ren Jones (21:32):
You need to be talking to these people.
Sarah Close (21:34):
Ren Jones (21:34):
And if you’re talking to these people in a very disciplined way. And helping only the ones that need help now and nurturing the ones that don’t. Staying in touch with the ones that don’t and following them along, but don’t put too much effort into following along, keep getting new ones.
Sarah Close (21:48):
That’s all right. Yeah, you can.
Ren Jones (21:49):
Because that next 10 people you talk to, one of them needs you now.
Sarah Close (21:52):
That’s exactly right. And yeah, we talked about it in again, the SHIFT book, that’s a really interesting resource, especially in this time. I would highly recommend that everyone spends some time with that publication.
Ren Jones (22:02):
Yeah. If you’re part of Keller Williams, they have a book called SHIFT, but anybody can read it.
Sarah Close (22:07):
Anybody can read it. You can get it on Amazon.
Ren Jones (22:09):
She’s dialed into that with her franchise, so that is a wonderful book.
Sarah Close (22:15):
Yeah. There’s a lot of information. I don’t care where you work, it’s applicable.
Ren Jones (22:16):
It reminds me of something that Gary Keller said to me one time. He goes, “Predicting the future is a fool’s game. But we know where we are right now, and right now these are the ways to get where we need to go.”
Sarah Close (22:29):
Right. Yep. And Ren, it’s that idea of knowing what the market of the moment is. What types of transactions are people more likely to be having now? What types of people are more likely to be transacting as the environment is changing?
Ren Jones (22:42):
Sarah Close (22:42):
Life events are never going to change. Are you going to see some people have some financial changes? Perhaps. It’s being thoughtful about where you’re going to be looking for your clients, and then developing a marketing message that is meaningful and applicable to those individuals who are able and ready to transact business and are motivated to do so.
Ren Jones (23:04):
Right. Because I don’t know about you, the highest interest rate I worked under was 13%. When we went down to 8%, we thought it was paradise.
Sarah Close (23:11):
Yeah, exactly. Exactly. That’s exactly right. I believe if, and I might be a little bit off on this number, but I recall, I believe that the historical interest rate that’s been tracked since 1990 is about 5.83%. And so, if we think about that, that has been the historical average for what is that, like 30-some odd years, helping a buyer understand that what’s happened in the past several years is not the norm. Those are the types of things that you need to be weaving into your dialogue that you’re having in your buyer consults that you can help them take action now.
Ren Jones (23:46):
Mm-hmm. Yeah. Right. If you have some stats, and sometimes it means showing them a couple simple charts so they can grasp this. And sometimes they’ll understand it from looking at the charts, sometimes they’re like, “I don’t know what all this means, but I know she does. And I’m going to trust her because she understands it.”
Sarah Close (24:08):
Ren Jones (24:09):
So be that expert.
Sarah Close (24:10):
Yeah. That’s exactly right.
Ren Jones (24:11):
This is awesome stuff, Sarah. This is awesome stuff. I think for all of us, for many people watching, you have two choices. The next 12 months can be your best ever or one of your best ever going forward.
Sarah Close (24:25):
Ren Jones (24:25):
Or you can react to what is a goal of newscasting, to upset you and cower, and that doesn’t work too well.
Sarah Close (24:38):
Yeah. Ren, you’re exactly right. It’s, “Here’s happening in the marketplace.” That’s kind of one piece of input. The second, and equally as important piece of input, as to what the result is of how this affects you, is how you choose to frame that. And if you look at the market conditions and you choose to frame that as your opportunity, and then you back that up with very purposeful action, you’ll set yourself up for a beautiful arc in your career, again, with market share that can’t be taken from you because it will have been hard won in a more challenging time. And if you think about the fact that there are going to be, some of your peer group is going to take this as a “Woe is me. I need to bow out.” That’s going to create that much more opportunity for you. So “lean in” is the message.
Ren Jones (25:30):
Sarah Close (25:30):
Absolutely lean in.
Ren Jones (25:30):
That’s the good news, because one out of four, one out of five, they just had one toe in the water in the height of this, are going to take their toe out of the water and that leaves a lot more for you. So I want to welcome more of you onto the listing side of the business, where you can make more money and have the time to enjoy it.
Sarah Close (25:51):
Ren Jones (25:52):
So if for you, if this pushes you a little bit more to the listing side of the business, welcome. Where have you been? We’ve been waiting for you.
Sarah Close (26:00):
There’s plenty of room.
Ren Jones (26:01):
That’s it. That’s it. Thanks again, Sarah. This has been great, and hopefully this helps several people out there in their trajectory of wealth.
Sarah Close (26:12):
Absolutely. Absolutely. It’s a great market for growth.
Ren Jones (26:14):
Great. Thanks, everybody for being here. Join us next week for another exciting show.
Sarah Close (26:20):
Take care. Thanks for coming.