Jul
3
WARNING: What I’m about to suggest in this article is not easy, but it offers three very profitable opportunities for your business. In fact, you’ll have to launch one very challenging business to tap into these three profitable opportunities.
I coach agents in markets all across North America, some in pretty small markets. Small markets mean small populations, which mean difficulties for agents trying to build large, sustainable businesses. Generating enough leads is hard in a small market, and leads drive sales.
One way to side-step this small-market challenge would to take your business to a national level. You could do this by marketing in national publications. For example, run your best lead-generation advertisement in USA Today, a national newspaper with a subscription base of more than 2 million . Think about the number of leads you would be able generate from just a single ad!
Maybe this doesn’t make much sense to you on the surface; the majority of national readers probably aren’t looking to move to your area. But what if you shifted your marketing toward real estate investors? You might be surprised to find a large group of people who might be willing to invest in attractive income properties in your area.
In order to capture sales to investors outside of your market, you’re going to have to offer property-management services to out-of-town property owners. This is why I issued the warning at the start of this article. Property management is not an easy venture to launch. There are obstacles to overcome and challenges to face.
However, property management services are what would allow you to sell homes to investors outside your area. The ability to take your business nationwide could be very profitable for you. Think about advertising in publications such as the Wall Street Journal or Investors Business Daily. What type of clients could you attract to your business?
Most agents who consider property management services only “see” the monthly management income. This income is attractive and can be engineered to cover all of your overhead expenses. If you have 50 homes under management and you charge $100 a month, your business collects $5,000 a month without having to sell one home. Not bad.
Another extremely profitable opportunity available to you through property management is the ability to sell the homes under management. An agent I coach adds a clause in his management agreements that gives him the ability to sell homes under management and earn full commissions on each sale. Obviously, the terms of the sale would have to be acceptable to the investor. If you had 50 homes under management with clauses that allowed you to sell them, you would have 50 pocket listings at your disposal. This would be a very attractive asset for your business.
Property management is a difficult business, and you would have to consider all the challenges before getting involved with it. Another option might be to find a great property management company and refer your clients to this company. This would still give you the ability to take your business national without having to provide the management services yourself. However, you would lose two of the sources of revenue available through property management: the monthly management income and the automatic listings you’ hold for the homes under your management. You would still have the ability to generate leads at a national level, though.
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