By Al Miller
Today’s real estate and mortgage markets require new skills to succeed. There are fewer qualified buyers, shrinking mortgage options, more regulations and tougher competition. For real estate professionals in particular, three emerging barriers stand in the way of closing more sales in this tough environment. But with the right system in place, agents can convert these barriers into new sales opportunities.
1. Capturing Online Leads: According to the National Association of REALTORS®’ annual Profile of Homebuyers and Sellers, nearly 100 percent of homebuyers start their search online. Currently, the lead-conversion rate from tire-kickers to serious buyers is about 1 to 3 percent. This proves the viability of the Internet as a valuable marketing tool. Now, real estate professionals need a better system for not only managing this growing source of leads but also increasing the conversion rate.
2. Abandoning Leads: Studies indicate that 88 percent of leads are abandoned by agents in 30 days or less. The problem is that the typical online buyer’s timeframe is much longer than 30 days. This disconnect makes it very difficult for buyers and agents to come together at the right time, which naturally results in fewer closed sales. As the popularity of online shopping continues to grow, this disconnect will only get stronger.
3. Longer Sales Cycle: Due to today’s tough economy, about 27 percent of our nation’s potential homebuyers have a FICO score below 650. More and more, real estate professionals are feeling the frustration first-hand: eager homebuyers who aren’t quite ready to qualify for financing. They’re still viable customers for agents—just not today. What agents need is a pipeline for managing these leads so that as each one eventually qualifies, agents know it’s time to reengage and start house hunting.
How do these barriers become opportunities? Embracing two critical strategies can make the difference:
-Speed to Market: Leads convert 22 times faster when an agent contacts the buyer within the first five minutes. An aggressive contact management system would give any agent a significant advantage.
-Relationship Building: It’s important to deliver better customer service and timeliness at two critical points: 1. the buyer’s first online inquiry, which can be months away from when they choose a home and apply for a loan, and 2. delivering an approved mortgage when the buyer is ready.
Al Miller is the senior vice president of Citi Partnership Channel.
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