Diversification As An Agent
You’ve heard from countless financial advisors that you should always diversify your investments. In my opinion (and experience) that’s actually very bad advice. However, when it comes to your real estate business, you should diversify your marketing approaches to get a good blend of clients.
Here’s what I mean. For most agents we have breaking into the luxury market within their own area, they start by doing 60% to 70% traditional transactions and 30% to 40% in the affluent price ranges.
Their traditional deals may be a blend of FSBO’s, Expireds, First Time Buyers, Divorcing Clients, Seniors and Boomers, Investors and more.
It’s absolutely CRAZY to focus on one type of client. You are asking for failure if doing this. Look at all of the agents that made money with short sales, then that dried up. Then the agents that focused on REO deals and that all dried up too. They went from earning hundreds of thousands of dollars to virtually ZERO.
You have to be pulling business from several different sources and have a nice blend of all homes, all styles, all areas and all price ranges. This allows you to keep the deal flow you need and of course the various baits attract various types of buyers too.
One of the big problems I see from time to time is that an agent will get really good at one technique (let’s say expireds) and it’s all they want to focus on. They can get several closings per month and they just crank out that business over and over. Then one day they wake up and realize that this one source has slowly started to dry up and they don’t really have anything else going so they have to start over with an entirely new approach.
This is a bad way of doing business. It’s ASKING for trouble. You always want to ensure you have some diversification. Don’t be too focused on sellers, too focused on buyers or too set on one individual marketing approach. There will always be one or two that are working REALLY well at any given time but don’t lean on it too much. If you and I were to do an autopsy on your business, what would the status check look like? Would it get a clean bill of health?