According to the National Association of REALTORS®, the typical REALTOR® earned 20 percent of their business from repeat clients and customers and 20 percent through referrals from past clients and customers. (2015 Member Profile, National Association of REALTORS®).
Without closely examining the above statement, it is very easy to undervalue the power of referrals. This brief article aims to clearly demonstrate how a REALTOR® / real estate agent could potentially increase his/her income by 42% with little effort.
To put this in perspective we can examine a conservative example. Let’s assume the following scenario: You have been a licensed real estate agent for 5 years. Unfortunately, you did not close any transactions in your first year. However, after implementing an effective marketing strategy, you were able to average 2 closings per month during the subsequent years. This would equate to 96 sales over that 4 year period.
We will assume that the average price of those homes you sold or helped your buyers purchas were priced on average $200k, at a commission of 3% or $6,000. Thus, during those 5 years, you would have earned $576,000. Not bad! We included year one because it enabled you to earn your commission for the subsequent years.
Now, going back to the National Association of REALTORS® findings – of the 96 total sales over those years you were in business, you could have potentially earned an additional 20 sales from those past clients and customers and 20 more sales from referrals. That equates to 40 additional sales on top of the 96 sales – bringing your total sales to 136.
Those 40 sales could have generated you an additional $240,000 (40 * $6,000)– bringing your total earnings over those 5 years to $816,000.00 (136 * $6,000). By simply staying in touch with your past clients and customers, you could potentially increase your income by nearly 42%. Yes, you read that correctly- by 42%. And what is required to accomplish such increase in revenue? Not as much effort as you may imagine. In fact, the hard work was finding the original 96 clients and customers you conducted business with.
All you have to do to earn the additional $240,000 is STAY IN TOUCH. I hope you clearly see the power of staying in touch with your previous clients and customers.
AgentRave.com was created to help home buyers and sellers select the right real estate agent in their area. On AgentRave, all real estate agents get a profile with detailed information about the real estate agent; including contact information, zip codes of focus, license number, neighborhoods of focus, property specialization, hobbies, etc.