The first (and most important) steps to becoming a Realtor
(Photo by: Christmas w/a K)
Since I have been consulting with so many Realtors lately, I have noticed a very defined pattern. Most Realtors started out not really knowing how they want to set things up. Many of those that have done well in the industry are still using the haphazard business structure they started out with when they had no clients. By helping them update their business systems, many of these agents are able to double or triple their sales without adding any additional staff members. What???!!! Yes, it really is true. It is too easy to let a business continue to run inefficiently. If it’s not broke (and making money) don’t fix it, right? I don’t agree with that at all. What if you could take one single day of changing a few systems, and increase yearly profits by 10%? It’s a no brainer.
New agents read this: You are at the beginning. You have a chance to do it all the right way from the start. And if you do, you will make it to the top a whole lot faster. The first thing I want you to do is read the article about the top mistakes new agents make, then come back and finish this article.
Now that you know what not to do, it is time to build a solid foundation. I don’t want you to take forever to try to set up things perfect, but having some sort of structure in place is extremely important for you to get on the right path. And it is important to have the at least some of these systems in place before you put too much effort in to getting new clients. Let’s start with the basics so you can get on your way. I am going to assume your budget for anything is pretty close to zero at this point, so let’s focus on things that are free, or close to it.
Getting Started
Dedicated Business Line. I think it is stupid to use your cell phone number as your business line, yet most agents do it. I don’t want you to put it on your signs, or your business cards. This is a huge bottleneck holding you back from huge success. Why is that? Because all of the calls come to you! When you become extremely successful, will you have time to answer 150 phone calls a day? NO WAY! I’ll assume for now you don’t want to pay the phone company for a separate line, so here is my suggestion:
Use a phone service that will forward your calls to whatever number you choose. Google Voice (Is currently in beta right now), is a free service that will do that for you. It will also transcribe your voice mails and email or text them to you. That is a huge time saver. There are also other slightly more advanced virtual phone systems you can use for a pretty small monthly fee. Many of them have the option of adding extensions that callers can dial, music on hold, forwarding to multiple land lines and cell phones, etc… FreedomVoice is one of these services, and if you search on Google, there are a ton more.
This gives you a couple advantages. Even if it is just you working alone, people get the impression of a larger business. Advantage number two is that you can answer less calls. Advantage number three is that you can forward the calls wherever you I want. FOr instance, you could forward it to a professional 24 hour call center that will answer all your calls for you. Or you could forward it to your assistant. The point being, when the time comes, it is easy to take yourself out of the phone answering position, which is a HUGE waste of time. If 20% of your phone call leads end up being qualified to buy a house from you, the other 80% of those calls you are answering are wasting your time, and you are too important for that.
Lead Follow Up. I would be willing to bet 90% of real estate agents WASTE UP TO 80% OF THE LEADS THEY GET. Of course not all of them would have converted to sales, but a portion would have. What do I mean by wasting leads? I am talking about all the sticky notes stuck on your keyboard and computer monitor. The buyer that couldn’t get a loan for another couple months. The seller that was going on vacation, but was going to sell after they get back. Oops, you forgot to call them back? Even buyers that are a year away from buying should be important to you. With the proper system in place, YOU will be the one that sells them a house when they are ready. And it really doesn’t take any extra work to track these leads if you have a system in place.
There are tons of contact management programs you can buy, or pay a monthly fee to use online. I won’t go in to details here, but take a look if that interests you, they really can be a great time saver. If you want a free quick solution right now, read on:
Create a spreadsheet. Name each column with information you need to fill in about your leads. Col 1: First Name, Col 2: Last Name, Col 3: Phone, Col 4: Email, etc… You also need columns for date of original contact, and dates calls were made to them. Make sure you have space for notes on the person. If this is someone that won’t be ready to buy for a year, you will need details to remember who they are (be sure to keep in touch with them, don’t wait a full year!) As each lead comes in, put it in to the spreadsheet. As soon as that is done, pull up your outlook calendar. If the person will not be ready to buy a house for a month, schedule a call in 2 weeks to follow up. It will pop up on your calendar, so you won’t forget. Refer back to the spreadsheet to look up the details on the person. This is a really simple and basic way to make sure you follow up on leads. It will need upgraded later, but is actually amazingly efficient. It is really important to have this system in place before you get a lot of leads, otherwise you will end up wasting a lot of them.
If you don’t have spreadsheet software, or a calendar, there are tons of free options. Go to download.com to search for some. If you prefer to work online, try Google Docs. This also makes it easy to share specific files and schedules with other people, even if they are not in the same physical location as you.
Company Policies.
This is so important, you CAN NOT SKIP THIS SECTION. Too many agents act like this: “Hello, I’m just some random person that sells real estate. What do you want me to do for you? When do you want me to call you with updates? Oh, you want me to cut my commission in half? Let me think about it, I’m not sure… Hmmm, I guess that’s OK.” Anyway, you get the picture. DON’T TREAT THIS AS ANYTHING OTHER THAN A BUSINESS. YOU ARE RUNNING A REAL ESTATE SALES BUSINESS, EVEN IF YOU DON’T HAVE ANY EMPLOYEES.
You need to WRITE DOWN your company policies, and stick to them. Let me give you a few suggestions.
- Have set hours. For instance, you don’t work Sundays, and you only have 2 days during the week that you can do appointments after 6pm. Set your schedule, and give the clients an option of which works best, but don’t give in and set appointments on your scheduled time off. You should also have at least one day a week that you schedule an office day, and don’t allow any appointments. Hold yourself to this. 99% of the time, the client will be able to make something work to fit in to your schedule.
- Require Buyers to get Pre-Qualified. Do you have any idea how many times I dropped everything I was doing, drove across town to show a buyer a house, only to find out their credit was trash and the mortgage broker ran the other way? I used to do that all the time. Any time someone wanted to see a property, I showed it to them. Here is how this should work:
You run through a simple call script with everyone that wants to see a property. Here are a couple critical questions that should be on the script:
Do you plan to purchase with cash, or will you be getting financing? (If financing, go to next question)
Are you currently pre-approved for a loan with a bank or mortgage broker? (If yes, they are good to go! If no, next question.)
I work with a mortgage broker that is extremely good at what he does, and he’d be the best guy around to answer all of your financing questions. With your permission, I’ll have him give you a call right away. (Notice I don’t give his number to them. I only work with reliable mortgage brokers that will call the client the same day, or the very next at latest. I would guess they are 90% more likely to talk to your mortgage broker if the broker is calling them.)
So now you have them pre-qualified (or you don’t, but now you aren’t showing them a house they can’t buy), and you can proceed to show them a house.
Have a written script for everything. Literally type out your scripts word for word, and refine them until they are near perfect. You need scripts for calling seller leads back. One for if they answer, and one for if you leave a voice mail. Have a separate script for buyers. Don’t leave this to chance. If you find out certain woring works better, update the script. This way you can pass on these tasks to an assistant later on.
Get Contracts Signed. I won’t get to upset if you show a pre-qualified buyer a house, maybe even two before you get a buyer agency contract signed, but that is the limit, and the less the better. Don’t risk showing them 30 houses and then have them sign a contract with a listing agent at an open house. This happens all the time. You don’t want to work for free do you? All you need to do is memorize a script that explains why you need them to commit to working with you, and ask them to sign. If they refuse, chances are you were going to have a problem anyway. Move on.
Create a policy for everything, and write it down. Some policies will be easy to come up with, and you’ll be able to get it written down before it ever even comes up. Others will have to be carefully thought out in response to certain situations. For example, what do you do if you listed a property, have an accepted offer, then an unexpected lien the seller has to pay shows up on the title work. In this scenario let’s say the seller was barely able to break even after paying off the mortgage, and has no money to bring to close. What do you do? Do you lower your commission to cover the unexpected fee? Do you try to get the buyer to up his offer a bit, or try to get the other agent to lower his commission a bit? Whatever you decide, write it down. And here’s a tip for that situation: If you don’t offer to cover the expense, 9 time out of 10 the seller will figure it out on their own.
That should be enough information to get you started. Be sure to sign up for my blog updates, they will get sent right to your email address.
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