I'm gonna give you some numbers that are just reality in our business that you should know. And these numbers are going to drive your success throughout your career — whether you like it or not.
Are you ready for these numbers? Here they are:
They may be slightly different for every person, but in general, across the country, here's what the numbers look like in our industry:
* For every 30 conversations you have, you'll average one closed transaction.
And I want you to remember this:
Almost every single transaction you will ever have in your career will be the result of a conversation you've had in the last two weeks. You want more closings? You're gonna have to have more conversations.
Here's another one:
* For every 10 sphere members you have in your database today, you should average one closing — assuming that you've made 20 to 50 contacts with them in the past year.
20 to 50 contacts will get you a 10 to 1 closing...
One thing that we should do this year is cut the dead wood.
What does that mean?
It means we don't wanna be walking up a mountain, our mountain being our figurative goal set that we've set for ourselves and have a backpack full of rocks on our back.
Now, what is that backpack full of rocks?
Those are clients that don't wanna sell, that don't wanna buy, that are wasting your time, that are frustrating, that are angry people that we do not need to be carrying around on our backs anymore.
We need to cut them loose and work with people that really wanna buy and sell.
So going into the new year, how can we approach our business a little bit differently?
One is to work with ready and willing clients which sounds crazy, but it is so simple that it's obvious, right?
We need to work with ready and willing clients.
Having a ready and willing conversation is important. So I'm gonna give you my "ready and willing" conversation script when I'm...
If you have a gap in your income right now and you're out of escrows, what's the cause of that?
The cause isn't anything you're doing right now.
It's not the market conditions.
It's not something you just did yesterday or the day before.
It's actually something you've done 90 days ago.
Whenever I do this with my coaching students when they're having a gap in closings, I tell them to look back to 90 days ago.
What were you doing 90 days ago? Let's really look at the calendar and open it up. When we open up that calendar, we'll inevitably see a gap.
Maybe they went on vacation. Maybe they just took a few weeks off because something was going on in their lives and they stopped prospecting 90 days ago. And that's what comes forward like a snake eating an egg. It just travels down the timeline and then boom, it blows up resulting in them having no escrows in the moment.
So how do we eliminate this situation so we don't have gaps in the future?
I have a question for you:
Who is your #1 competitor in your marketplace?
When I ask that to a live audience, I'll hear all kinds of the typical brand answers. You'll hear the brands in their marketplace: Remax, Coldwell Banker, eXp, John L. Scott, Sotheby's, etc.
And I always tell them, you're all wrong. Your #1 competitor in your market is Zillow. Zillow is coming to eat your breakfast, lunch, and dinner. And in a large degree, they already are. Now, yes, Zillow has stumbled with their flipping operation. But does that mean they're going away? No. If anything, we should be more terrified now than ever, because they're going to turn and focus their entire attention back to where they actually started out, which is selling leads to REALTORS. They are not going away.
What does this mean? When lose something to Remax or eXp, you need to ask yourself:
Did I really lose that listing to those companies? Or did somebody go on Zillow, fill...
Now we've all heard of supply chain issues hitting the entire country. Lots of things happening because of COVID breaking down the supply chains.
But is this impacting real estate?
It absolutely is impacting real estate. It's impacting builders. It's impacting all kinds of vendors that are tied to real estate.
My wife and I are remodeling a house and we've had to wait six months for the cabinets to come in. It's impacting remodeling and flipping and all kinds of areas that we don't necessarily consider tied to the supply chain.
But real estate is definitely one of those areas.
So how can we use this?
Here's one way we can use it when we're out prospecting is talking about supply chain issues because everybody can identify with it right now.
So you might just say:
"Hey, you know, what, can you do me a huge favor? Even real estate is facing supply chain issues. We're facing very low inventory compared to most years and huge buyer...
If you know people in your sphere of influence that own investment property, I've got some good news. Also, if you own an investment property, I've got good news. And if you're trying to sell investment property, I've got good news:
The investment property side of our business is going through a real resurgence right now. We knew during COVID they got kinda hit. We know the eviction moratoriums made it really tough for them. But now we're starting to see people come back out of that.
So here's a few good numbers in that arena that come from us from the NAR economist blog:
Two of them are dealing with absorption rates. Absorption rates, meaning how many units are being absorbed by the market.
In Q2 and Q3 of this year, 700,000 units were absorbed by this market. It's a lot of units, but completely instantly absorbed by the market.
Vacancy rates have fallen in 2011-ish from 6.9 back then all the way down to 4.6 now. That's a nationwide...
I have some good news for people that already own a home that are in your database.
Here's the stats:
According to the KCM blog, home equity is up 29.3% across the board — which equals $51,500 in added equity over the past 12 months.
So then the question is:
Well, what can people do with that equity?
And there are a lot of things they could do:
They could pull it out in cash with a refinance, of course. They could take that equity and use it as a way to move into their dream home by stepping up — and there's a lot of people out there that may not realize that they can step up into their dream home with very little changes in their payment because of their equity.
There are tons of conversations you can have here.
Take that data, repackage it, and push it out to your people in your sphere of influence and start having conversations with them.
You could say, "Hey, would you like to get a specific number for how much equity build...
Zillow announced recently that they've stopped buying homes!
In their press release, they said they had supply chain issues and labor shortages, which is interesting because when you look at what they actually did in Q2 and Q3, where we've had kind of the same issues going on, they actually doubled the amount of homes that they purchased during that time compared to last year.
So why would they go from twice the amount they were buying last year to stopping on October 18th?
Some people are saying that one reason might be they're seeing market changes, just like we've been talking about. They're seeing a lot more listings coming to market which creates pricing pressure and competition. So they may not be able to come in and pay these high prices and then resell it at an even higher price. Because Zillow runs a flipping operation, right?
So we're actually seeing that. I've got a lot of students and a lot of parts of the country that...
How long do people stay in their homes? It's an interesting question. And it's a question that's related to marketing for us.
Prior to 2008, the average person stayed in their home five years before they moved on. So quite a bit of turnover there.
From 2008 to 2016, that number moved up to eight years.
And now that number has gone even higher — it's now 10.6 years.
So why are people staying in their homes longer? Well, there's lots of reasons.
The Great Recession had an impact. Super low interest rates have an impact. Having less inventory in the markets for people to move up to and change homes has also made a big impact.
But one question we should know and ask our clients is how about our local market? How about with our own sphere? What does that look like for the people that you're actually doing business with?
It's a great text. It's a great social media post to ask this question:
"The average homeowner spends 10.6...
Hey guys, the market's shifting. That's no surprise here — we've been seeing it for a few months. We're starting to see buyers put up some walls and say, "Hey, wait a second. I'm not going to pay infinity for a home."
And so buyers are slowing down their activity and we're seeing that. And it's also causing inventories to rise, which in turn, is causing sellers to try and avoid missing the boat so they're jumping in. This is causing inventories to rise even more.
So the whole market is starting to change. Not radically yet, but it will accelerate over time. And it's natural. It's normal. We're never going to have a straight up market forever. Right now, some people would argue that we're 12 years into a seven-year cycle.
Now for us, I have a question for you because you are either an agent that's market-driven or strategy-driven.
If you're market-driven, then high tide floats all boats. You do well in a great market and you do...
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