The market is vastly different from what it was six months ago, which has many agents feeling anxious or unsure. Since the average experience level of agents in the marketplace is eight years, most haven’t seen a slowdown before. Brokers can help ease discouragement by teaching agents creative ways to make money beyond the buying and selling process.
Showing agents how to diversify their incomes helps boost morale, keeps profits flowing and more importantly, it boosts retention by showing agents the value of being part of your brokerage, says Valerie Archer Belardo, broker-owner at RE/MAX At Home in Columbus, N.J.
"The managing broker and owner are responsible for showing [agents] how to diversify their income and build a strong clientele," agrees Anthony Garland, managing broker at AGG Realty Group in Oak Park, Ill. "Doing this leads to the long-term success of the agent and the brokerage."
So, what does it look like to prepare agents for new opportunities for income growth? There's more than one answer, according to Belardo. Some agents excel at turning past clients into investors. Others find success in turning tenants into buyers. For still others, says Garland, the key is actively networking in the community to plant seeds for the future.
Teach Homeowners to Become Investors
Make sure your agents have a plan for turning past clients into investors.
This can be part of an automated marketing strategy, says Belardo. "[Agents can] contact past clients in their database to introduce the idea of purchasing investment properties," she explains.
The brokerage can help agents develop a strategy that matches their client base. Offering agents tips on turning past clients into investors shows that you have their back and can help them grow their income even in slow seasons.
Agents can help past clients understand the benefits of investment properties in a few ways, according to Belardo, and it’s the broker’s job to help make these options clear to agents:
Schedule online information sessions. "Offer online Zoom meetings with mortgage and financial experts," she suggests. This gives past clients the opportunity to hear about the benefits of investment properties and discuss their investment readiness.
Send monthly newsletters. Agents can be a valuable source of information about real estate investment opportunities in the local market, average rates of return on local investment properties, and even mortgage information.
Become the go-to information source. "Talk about hard money for investors or using equity in your home to purchase an investment property," says Belardo. "Explain the difference between a rental investment, quick flip or total rehab." The point is to teach agents to add value to clients, past and present.
Consider direct marketing. If a past client has expressed interest in investing in real estate, targeted direct market materials can keep their attention and drum up excitement.
Turn Tenants Into Buyers
Not all tenants are ready to become buyers. But if a tenant's goal is homeownership, agents can offer valuable advice and resources now to clinch the sale later.
"As a broker I train my agents to understand that they are in a service business," says Belardo. "Helping others achieve their goals will help you achieve yours."
For tenants, brokers should train agents to act as educators on home ownership. A marketing plan should include informational materials for renters, says Belardo.
For instance, agents could send targeted mailers or emails to tenants. The information might include charts showing the monthly costs of renting versus buying and contact details for a mortgage professional. Agents can also find out which local banks offer first-time home buyer programs and share that information with tenants, Belardo says.
"[Take] a consultative approach," emphasizes Garland. "Buyers and sellers make decisions based on their limited real estate knowledge. Agents must find out their client's objectives and give them the best method to achieve those goals."
The bottom line? Focusing on ways to help future buyers—not just those looking for a house now—can pay big dividends in the future.
Encourage Face-to-Face Connections
Never let your agents underestimate the power of face-to-face networking.
"Door-to-door is my favorite strategy and is responsible for over half of our business growth," says Garland. His brokerage trains agents to go door to door and educate homeowners on the local market, including projections of future market conditions.
The goal is to get out into the community and build relationships, even if they don't immediately lead to listings or new clients. Of course, sometimes results are instant.
"One of our agents utilized our door-to-door script and implemented this strategy, and within their first week, they acquired two listings and an investor client who respected her hustle," he says.
Help Agents Invest in Themselves
When the market slows, some agents get nervous. One of the most important strategies for helping agents see the value in staying the course for the long haul? Training agents to treat their business like a business, says Belardo.
"As a broker we have an important role to play helping our agents grow to be the best
They can be as a real estate professional and a person," she says. Preparing agents for new opportunities is important, but it's also crucial for income diversification to take place within the structure of a sound business.
Belardo has several tips for brokers ready to help their agents invest in their own businesses, which can boost sales and reinforce the broker-agent relationship:
Schedule quarterly meetings. "Review business plans, discuss income/expenses, and most importantly, goals," she says.
Encourage financial education. Whether the market is up or down, financial wellness is critical for agent success. "Instill in them that it is important to keep three months of reserves to run their business to be prepared for a shifting market," she says. Brokers should also encourage agents to talk to an accountant, keep a list of expenses, and keep estimated quarterly tax payments in a separate account.
Create a marketing plan. A changing market is still a live market. Brokers should teach agents to ramp up their marketing efforts with past clients and warm leads or even start marketing in a new niche.
Help Agents Think Outside the Box
There are so many ways to make money as a real estate professional, emphasize Belardo and Garland. Teach agents to stay alert and open to new opportunities to be ready to create a plan for whenever the moment strikes.
Belardo suggests asking agents what they love to do, even if it sounds like an activity outside of real estate.
"Start a cleaning service that does closing day cleanups for agents," Belardo suggests. "Create a coupon book for new homeowners with the local restaurants that you can mail to communities. Start an investment group to purchase tax sale liens or bank-owned homes."The bottom line? When brokers help prepare agents for new opportunities—from turning past clients into investors to adding a new, creative service—everybody wins.