5 Sales Forecasting Tips for Real Estate Agents
Can you predict the future of your business? Can you read the proverbial tea leaves to determine which prospects in your pipeline will lead to money in your wallet?
For top real estate agents, the answer is: for the most part, yes.
They’ve learned how to analyze behavior — both their own and that of potential clients, whether buyers or sellers. It’s allowed them to developed activity-based sales techniques that move business through the funnel and dramatically improve their forecasts.
It takes a keen eye, a keen ear and a willingness to break from the norm.
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Go old school
Facebook, Skype, LinkedIn, email, texting and dozens of apps may help you connect with potential clients. But for a much better shot at clinching their business, it’s all about face to face.
“If you want to predict the action of a buyer, ask for an appointment,” said Dirk Zeller, author of several books on real estate.
And move fast — it’s important to be first. Two-thirds of first-time buyers hire the first agent they meet with, according to the National Association of Realtors (NAR).
“If I can’t get them to my office, then I downsell, offering to meet them at a Starbucks, a neutral site,” Zeller said. “If I can’t get that, maybe there’s a property they had an interest in, and I can get them face to face.”
Unleash your inner therapist
When you’re getting to know a client, learn his or her story. The more you learn, the more you can pinpoint the motivation for buying or selling — and just how strong it is.
For buyers, the most the most popular motivation by far is the “desire to own a home of my own,” the NAR found. The desire for a larger home comes in a distant second.
So the more a potential client is ready to wax poetic about the desire to own — and the more it speaks to who that client is — the more likely that business is to be viable.
It’s similar for sellers. The bottom line often takes a backseat to emotions.
“I think of it as being a therapist,” said Karen Kemp, who reaches out to potential sellers in key areas and puts packages together to sell the land to developers. In an annual list, REAL Trends named her team in New York No. 1 in its category.
“You have to really listen to what they’re saying to you,” Kemp said. “You can’t keep your mind in a place in which you’re going for a specific outcome. It’s a little more exploratory than that. You’re kind of uncovering, uncovering. You have to figure out who they are.”
Do this right, and you’ll have a better shot at determining whether you can get them over the “psychological hurdle” that might prevent them from selling, Kemp said.
Another key to predicting sales requires taking a good, hard look in the mirror.
The biggest reason people choose an agent is reputation, the NAR survey found. So it’s important to get the most realistic sense you can of what people are saying about you, and about your competitors.
The survey also found clients want their agent to be “honest and trustworthy” and to demonstrate knowledge of any given neighborhood.
So after any kind of interaction — whether in person, by phone, or even in writing — analyze your work and ask yourself whether you nailed these characteristics. If so, you’ve got a bigger chance of clinching the business.
Consider your opportunities to be aggressive
It’s easy to get energetic and excited to make deals happen. It’s also easy to cross a line, making potentially viable business go away. For example, if an agent pushes a client to buy a particular house, that client just might follow advice from U.S. News and World Report to “fire your agent.”
But some kinds of aggressiveness can be great. Duffy Realty of Alpharetta, Georgia, which is also No. 1 in its category on the REAL Trends list, surprises some people with its proactive selling style.
If a potential buyer visits a property twice, “our contracting team will contact that agent to see what their client thought of the property,” said Frank Duffy, who runs the business with his wife, Rhonda. “We’re trying to engage them in conversation and find out if they’re likely to make an offer. If they’re not ready to, we have our sellers make the first offer. So we bypass the buyer’s first offer and jump right to what might have been their counteroffer.”
To forecast just how likely a piece of business is to make it through the pipeline, look at whether it offers you opportunities to push in just the right way. How much aggressiveness is the client comfortable with, and in what ways?
Be a rebel
There’s also another way to potentially boost your ability to forecast sales: toss out the traditional methods altogether.
“Our model is much more predictable — and much higher volume,” Duffy said. His firm operates on a flat fee, rather than a commission, for sellers. Since clients know they won’t lose the standard 3% that they’d have to pay to a traditional agent, “they’ve got a lot more flexibility to make a deal work,” Duffy added. “And that’s what’s really predictable.”
So predictable, in fact, that the company sells about 1,500 properties every year, with very little variation. Compared to what many other agents are going through, Duffy’s forecasting is a cinch.
Practice, practice, practice
None of these skills pops up overnight. They’re learned through experience. The key is to keep learning — and be willing to change as needed.
To make sure you’re moving forward, use lists. Write down your forecast, date it and don’t change it. Then, give yourself a checkup and dig in to the numbers. Which ones were you right and wrong about? What did you not see coming? What might you have done differently?
It’s an exciting career, if also intimidating. But with tips like these from players at the top of their game, you’ll have an advantage.