The real estate industry is reeling on all sides.
Environmental change, shifting political climates, volatile markets, rising mortgage rates, and evolving technology trends are just some of the challenges agents are facing everywhere.
Ask your typical agent for a list of their biggest challenges, and you’ll invariably hear many of the same answers repeated.
Rather than repeat commonly recognized problems, we’ve decided to focus on the 5 most critical challenges facing real estate professionals today.
Whether you agree or not, the challenges listed here affect solo agents and brokerages in one way or another. Some of them are unique to real estate, others are applicable to just about any industry. But the solutions offered are practical and can be implemented even by agents without a lot of experience.
So, without further adieu, here are our top 5 challenges.
TOP 5 ISSUES FACING REAL ESTATE AGENTS
#1) LOW INVENTORY
It’s pretty simple: without inventory, you have no income. No income means no business. Finding listings in a low-inventory market, however, has become a challenge even for agents with years in the business.
New agents, especially, will find it a challenge to find sellers. Lack of experience makes new agents less attractive to homeowners seeking to retire comfortably and profit from the sale of their home.
Of course, you can’t gain experience if no one lists with you! Which is why you have to shift your focus. In other words, if the fish aren’t biting, go where the fish are!
SOLUTION: EXPAND YOUR SPHERE OF INFLUENCE.
Referrals are the best source of leads in any market. They’re even more crucial to your business when inventory is low. Sellers are far more likely to trust a referral over a stranger when buyers are hard to come by.
And given that most sellers interview only 1 agent, expanding your sphere of influence should be your top priority. One way to grow your sphere of influence is to interview local business owners. Publish and promote each interview as a blog article, video, or live stream event on social media.
If you do this, local business owners will promote you in turn by word-of-mouth. They’ll share the interview with their social network, increasing your exposure as well.
Best of all, you’ll make face-to-face connections in your farm and establish yourself as THE neighborhood expert!
#2) GROWING ONLINE COMPETITION FROM LISTING PORTALS
The growing popularity of listing portals and the proliferation of homebuyer apps have limited the agent’s role, but not eliminated it. Heck, even large brokerages are struggling to compete with the appeal of services like Zillow, Homesnap, and Zoocasa.
The success of these user-centric brands with digital home shoppers is a clear sign of what the future holds for real estate: Millennials and the posterity will seek out an agent at increasingly later stages of the buying cycle. Digital advertising will become less effective as sellers and buyers opt for ad-free servicesSocial networks will be crucial for finding referrals.
SOLUTION: LAUNCH A NEIGHBORHOOD WEBSITE OR BLOG.
A comprehensive website for your community or geographic farm is a great way to compete with the larger brands and more seasoned agents in your farm.
Although time-consuming and costly, a neighborhood website will do more for you than an IDX website. Everyone has an IDX website these days. If you don’t have listings, your IDX website won’t be very appealing to prospective sellers or buyers. Instead of listings, list local businesses, local news, and events on your site. Update it daily to stay relevant and competitive with other news sites and directories that offer business listings.
As your website content grows, search engines will come to recognize you as a trustworthy source for local information. Search engines will index more of your pages, increasing your chances of being discovered in organic searches.
Once visitors discover your website, you can convert them into subscribers. As your database grows, you can segment it and cultivate relationships over time. This will lead to valuable referrals who would never have responded to an ad.
Consider joining Parkbench.com, the only service in the world that actually builds community websites for real estate agents.
#3) ADAPTING TO TECHNOLOGY TRENDS
Algorithm updates, data security, privacy policies, marketing automation, SEO best practices, SMART home technology – stop me whenever you like!
Today’s agent has to be as savvy at using technology as they do at prospecting. Brokerages and teams, in particular, must keep pace with new trends and updates to technology regularly.
Purchasing the wrong CRM, errors with a transactional app, or transferring domains to a new a server can quickly spiral into expensive problems that set you back for months.
Solution: Work With An IT Expert
Whether it’s setting up an email account, choosing a domain name, or deciding on a web-based CMS, tech decisions can’t be taken lightly. If you don’t consider yourself a tech expert, seek out someone you can rely on for tech advice. An IT expert can advise you on cost-effective alternatives and even trouble-shoot for you when you run into problems.
If you rely on a website CMS or web-based CRM, seek out services that provide customer support, preferably live. Read customer service reviews, as well, to be sure they deliver what they promise.
#4) COSTLY LEAD GENERATION
The volatility of auction-based CPC lead generation can inflate your ad budget overnight in some markets. Extensive ad networks like Google AdWords attract major real estate brands who compete aggressively for desirable keywords.
In the early days, when social media was new, savvy marketing agents could generate leads and exposure with only a modest budget. As social media networks reach global saturation, digital advertising is becoming more costly, while yielding lower ROI for advertisers.
SOLUTION: FOCUS ON BUILDING ORGANIC TRAFFIC.
Your prospects use search engines each day to find local products. Organic traffic can raise your visibility in search results. By using the appropriate keywords and implementing metadata, you can improve your website’s appeal with search engines.
#5) CULTIVATING A DATABASE
Building a database is one thing. Cultivating a database for leads and referrals is yet another hurdle to an agent’s success. Most agents overlook how important it is to stay in touch with contacts regularly. Inexperienced agents focus on the immediate sale and fail to follow-up with clients after the transaction. Only 25% of agents actually cultivate their existing contacts and past clients for referrals. As a result, they miss out on referral business, which can account for almost 50% of your annual revenue!
Research provided by Brian & Buffini yielded the following insights about referrals among real estate agents:
25% of agents generate more than 50% of their annual business entirely through referrals! 88% of buyers claim they would use the same agent or refer them.The average agent earns 42% of their business through referrals!82% of ALL real estate transactions are
Agents typically seek out prospects in the final stages of the buying cycle, but this is a flawed approach. Looking for qualified buyers/sellers exclusively is a narrow approach that overlooks the importance of the client’s journey. Top agents rely on a strategy for nurturing contacts through the earliest stages of the buying cycle. By consistently nurturing your contacts, you remain top-of-mind with prospects long before they have a need.
SOLUTION: IMPLEMENT MARKETING AUTOMATION
We get it. Staying in touch with dozens or hundreds of contacts is time-consuming!
Thank goodness for technology! Automating your email delivery will save you valuable hours each week. Used correctly, marketing automation can also help you target your messages more effectively to the right market segments.
Here are a few things you can achieve with automated tools working for you:
Schedule emails to promote your next listing Onboard new clients with a strategic drip campaign
Serve relevant ads to visitors long after they leave your website or while they are using other apps
Automate social media posts for optimum reach
Engage visitors to your website seeking information who are early in the buying cycle
Send notifications, reminders, and alerts to targeted members/segments of your database
Messenger bots and retargeting ads can also reduce missed opportunities to connect with online visitors.
Facebook provides free developer tools for creating your own messenger bot for your Facebook page.
You can also commission someone on Fiver.com to install a message bot for you.