Real estate referrals occur when another licensed real estate professional, a former client, or a referral company recommends your real estate services to someone looking to buy or sell a property. The reason for a realtor referral could be as simple as a client moving out of state or to a neighborhood the agent doesn’t know too well.
But whether you’re struggling to find new business, or need a more organized system for managing your leads, a real estate referral program may be what you need to grow.
Here are five reasons to use a real estate referral program.
1. Receive Quality Leads
Agents can waste time and money trying to find buyer and seller leads manually. Discovering a quality resource for buying real estate leads gives agents a head start on sales and fills your funnel with potential clients.
Real estate referrals are the highest quality leads, and a sign of a mature, quality real estate business. Many top agents work exclusively from referral leads. They’re often low cost compared to other marketing methods.
Real estate referral programs often use the power of Google AdWords and Facebook to reach their audience, or reach within their existing network for top agents. From there, interested prospects often land on a webpage where they fill out a contact form to receive more information from you.
2. Gets Your Name Out There
When using real estate referral programs, you often have the option to have your profiles appear on listings when buyers search for properties on their site. This allows warm leads who are seriously considering buying or selling to come to you for their real estate needs. When a prospect wants to contact an agent for more information, they can do so from the listing by filling out the form. There is no need for a user to navigate to a separate landing page.
3. Provides Training and Support to Agents
When you sign up for a real estate referral program, they want to see you succeed. To help you grow your business, they often provide you with the tools needed to gain quality leads.
Such tools can include a library of training videos that cover sales, marketing, search engine optimization (SEO), social media, and ad writing. Other resources may include professional podcasts, along with email and phone support.
You can also expect helpful agent forums, courses on marketing and sales, and webinars to increase agents’ understanding of the platform. With a list of online guides that cover everything from business planning to call scripts to conversions, there is an incredible amount of coaching and information available for customers.
These programs are strong in training and customer support, to ensure you are all set to succeed.
4. Build Client’s Trust
In sales, especially real estate, it’s imperative for your prospects to trust you. One of the best and most efficient ways to build this trust is for you to be introduced to the prospect by a mutually trusted party. And utilizing a well-known real estate referral program may be just the ticket.
A prospect is much more likely to trust and become interested in your business if they have heard about a positive experience from a trusted source. This marketing creates much more interest in you as a real estate agent, and can be even more effective than other marketing efforts, like cold calling.
According to a study conducted by Goethe University published in Forbes, client referrals are 18% more likely to stay with your business than other customers. The study traced the referral program of a German Bank over three years and found this number to be consistent. While the reason client referrals have a higher level of retention may be debatable, it can more than likely because of the increased level of trust with you as an agent.
5. Cost Benefits of Real Estate Referrals
Referral fees in the real estate business are fees charged by one agent or broker to another for a client referred, based on the eventual commission when the sale closes. Real estate referral fees range from 20% to 35%. This fee is a percentage of the final commission received by the agent who accepts the referral.
Real estate agents and firms can also use referral programs to increase profit margins. In fact, referred customers are more likely to purchase services at full price because of the trusted, positive review. With real estate, this potentially means higher selling prices, and higher commissions.
Referred customers are commonly less sensitive to price. As a result, most referrals can result in a much higher profit margin because they are presold based on your client’s credibility and trust.
Want to get more real estate leads and referrals? Join the Clever Partner Network to get quality leads to help grow your book of business. As an agent, you only pay a referral fee after you close, paying no upfront costs. We bring you pre-screened, ready-to-list buyers and sellers, so you don't waste time chasing leads who won't convert.
Gain the chance to promote your expertise through confidential, personalized proposals that highlight your skills. We help you tailor your listing presentation to the buyer’s and seller's preferences, increasing your chances of sealing the deal. Contact Clever today to get started.