A real estate referral business is one of the easiest ways to generate leads
Realtors are a vital part of the real estate market, helping to facilitate deals and ensure clients make the best financial responsible choices. But there’s another set of key players in the industry that aren’t well-recognized called “real estate referral agents.”
I was recently asked to share how to scale a referral business by the Icons of Real Estate podcast. You can hear the full podcast and read their summary here!
The following three strategies, plus some of my curated tips, will help you scale your real estate referral business.
Step 1: Send Regular Follow-up Messages to Previous Clients
One best way to get more real estate referrals is to follow up with people in your sphere of influence (SOI), including former colleagues, family, friends, and even past clients. You might have someone in your SOI who would happily refer you to their acquaintances and friends. However, they need to remember your name, address, and contact information.
Consider opting for CRM software to streamline communications with your clients and leads. CRM software stores the contact information and data of people in your contact list. That way, you can easily send or automate texts, emails, and phone calls to your contact to maintain effective client communication.
Also, CRM software helps you see who responds to your messages (replies, clicks, opens, etcetera) while reminding you to reach out if it’s been a while since you did.
Establish a long-term relationship and reinforce your brand by routinely sending emails with just a hello note, new listings, market reports, newsletters, and holiday greetings.
It’s hard tracking your contacts by yourself as your business grows. Therefore, you need CRM software built to manage and track your contacts to ensure effective communication.
Step 2: Form Collaborative Partnerships with Real Estate Professionals
Creating a collaborative relationship with other real estate professionals can benefit your referral business greatly. It’s best to connect with a team to offer specialized all-in-one services to clients instead of allowing them to find multiple professionals for their transactions.
Consider partnering with home appraisers, inspectors, contractors, title companies, divorce attorneys, and real estate attorneys to provide an all-inclusive service for your clients.
For instance, a mortgage broker and realtor under a partnership can send joint direct mail ads to prospects, ensuring potential clients have access to a one-stop shop for their real estate transactions.
Co-marketing partnerships with other agents can skyrocket your sphere of influence and increase your marketing efforts, according to your contacts and marketing tools.
Simply put, when you support other businesses, they’ll also support your real estate referral business. However, before co-branding in events or marketing materials, make sure your state allows that.
Referrals on social media help you broaden your sphere of influence
Step 3: Encourage Referrals on Social Media
Social media is the fastest way to join a real estate referral network and grow your local brand recognition. You can ask your clients and friends to post about your services on their social network accounts on popular platforms like Twitter, Instagram, or Facebook.
Also, post and highlight your expertise to maximize social media possibilities. You can provide statistics, facts, and knowledge privy to only real estate insiders, such as a blog post on reasons to choose a reputable agent with a real estate license. Don’t forget to add a link to your landing page or website to capture new leads.
Tag your customers when posting their active listings or completed transactions to enable you to appear on their feeds. That way, their family and friends can see you and discover your expertise.
Remember to add hashtags to your social media posts to improve brand awareness, enabling you to reach your target audience to generate referrals.
For example, an agent in Georgia specializing in the Atlanta real estate market can use hashtags like #atlantarealtors, #atlantacoops, or even #atlanta to reach more prospects in the desired area.
Also, ask your sphere of influence to post about your business on their social media pages to promote it. According to research, 77% of customers will likely purchase a new product from a friend’s posting on social media.
Don’t forget to grow your business by expanding your network beyond your SOI to people who can generate more clients for you through referrals. If you need to learn how to utilize social media and other marketing strategies, consider working with an online marketing company like ArdorSEO.
ArdorSEO offers SEO for real estate agents alongside other online marketing strategies, including email marketing, search engine marketing, and social media marketing, to help real estate agents find more potential buyers and convert them to paying customers.
What Is a Real Estate Referral Agent?
As can be deduced through the name, a real estate referral agent refers clients to a real estate brokerage instead of directly working with them. After concluding the transaction, they receive their referral fees.
A real estate referral business benefits both the agent and the clients. The clients enjoy being referred to a realtor who can accommodate their needs while providing personalized guidance throughout the transaction process.
Alternatively, the agent can work with a trusted professional who will keep referring clients regularly.
Duties of a Real Estate Referral Agent
Some of the primary duties of a real estate referral agent include the following:
- Generate high-quality leads and create more referral opportunities
- Work with various types of real estate agents and local expert service providers
- Build strong referral networks covering different real estate markets and investment property types
Sources of Real Estate Referral
Referrals are a major real estate lead generation source, considering the leads often convert to paying clients. One great part of running a real estate referral business is getting referrals from multiple ways to increase your referral pool.
Generating referrals from various sources lets you connect with sellers and homebuyers who will continue to refer you to more customers, helping to grow your business.
The following are common types of real estate referrals:
Agent-to-agent real estate referral benefits both the client and the agents alike
Most real estate agents have a farm area (a county, town, city, or neighborhood) where they channel their marketing efforts. Some even work with a specialized type of client.
For instance, some realtors focus on the commercial real estate sector, like NNN investment properties, while others specialize in residential properties, like single-family homes.
When a client moves to a location outside an agent’s expertise or farm area, the realtor can utilize agent-to-agent real estate referral. Besides the client exploring a knowledgeable and trusted connection, the two agents can work together to generate more income and leads.
The agent that referred a potential client to another realtor will receive a referral fee as the transaction’s commission. Therefore, it’s best to have a written referral agreement clearly stating who the contact is, the scope of their transactions, and their contact information.
This contract will be sent to the receiving agent’s office manager or broker to sign.
Another way real estate referral agents get referrals is through partnerships with local businesses, like appraisers, home inspectors, banks, mortgage brokers, and real estate attorneys.
Consider creating business partnerships for compensation, even without a formal referral agreement. Also, connect with other types of top industry professionals, such as financial advisors.
When a client or new lead notifies you that someone referred them, follow through with a small pop-by gift and a personal note to encourage continual referrals and maintain the relationship.
This type of real estate agent referral is the most common. It entails a former or current client referring the agent to other sellers or homebuyers for their services.
Providing quality services will ensure your clients trust you enough to refer your business. Hence, it’s easy for successful real estate agents to thrive on referrals. It’s best to always ask your clients for referrals after providing a successful top-notch service a few days after their closing date.
The review mustn’t be long. How the client felt working with you and how they perceive the entire transaction process is enough. A referral from one client can be the link between generating leads that turn into paying clients over time.
The Bottom Line
A real estate agent referral business is one way to generate leads and turn prospects into paying customers, helping you grow your real estate business.
Although client-to-agent referral is the most common way of generating referrals, it’d be best to partner with other local businesses and professionals to grow your business and expand your sphere of influence.
If you’re interested in starting a real estate referral business, listen to Justin Stoddart speak on the keys to scaling the real estate agent referral business in an episode with the leading podcast about real estate, Icons of Real Estate.
As a renowned real estate business coach, Justin Stoddart shared vital tips and tricks on navigating the real estate referral business sector and becoming a successful referral agent.
The real estate industry presents many opportunities for making money. If you’re considering becoming a real estate referral agent, you need professional tips and tricks to navigate the industry.
Listen to Justin Stoddart share these success tips in this Icons of Real Estate podcast episode.
When you're ready, here are a few ways we at Think Bigger Real Estate can help you...
1. Get Your Personalized Referral Score™. Discover how much untapped commission dollars are available inside your sphere and professional network AND the first step you can take to capture this low-hanging fruit CLICK HERE
2. Join our free mastermind: Think Bigger Real Estate. Everyone wants to work by referral but what do you do when your goals outpace the number of your referrals received? To learn how to scale up your referral-based business CLICK HERE
3. Schedule a conversation to explore what it looks like to work with us directly:
To get help becoming a top professional with a 7-Figure-Funded, Significant Life (growing a wildly successful enterprise without losing focus on what matters most (body, mind, heart and spirit) CLICK HERE