Commentary by Bill Miles
RISMEDIA, Feb. 27, 2008-The real estate market is challenging throughout the United States. For the first time in nearly 13 years, U.S. home prices experienced a quarterly decline, according to the Office of Federal Housing Enterprise Oversight (OFHEO, November 29, 2007). Additionally, single family home sales fell by 13% in 2007, which was the largest drop in 25 years (CNNMoney.com, January 24, 2008). Credit markets are in turmoil and the stock market is down from last Summer. As a result, it is harder to make a living representing buyers and sellers as a real estate agent.
So, what are your options? Well, you can press forward pursuant to your current business plan, or you could tweak that business plan to accommodate the changing market. However, the transactions may not be there no matter the adjustments you make. Maybe you should consider changing careers? But you have invested so much time and money into your real estate career, leaving it would seem short sighted. How can you make this work? How can you survive this market and set yourself up to benefit when the market dynamic turns around?
What if you could develop revenue streams related to your real estate business, but not in the form of commissions associated with buying and selling real estate? These revenue streams would not detract from your real estate career, but instead leverage the time, money, learning and expertise you have developed as a real estate agent. In fact, if properly considered, these supplemental revenue streams could reinforce your core real estate business and set you up for growth as the market turns around.
Below are suggested areas in which to explore supplemental revenue streams by leveraging your current expertise. You should consider your own strengths and then work to develop a revenue stream leveraging that area of your business. The goal for any of these suggestions would be to supplement your income by $1,000-$3,000 per month during this difficult market.
1. Are you a good writer? If you enjoy and often get compliments on your writing, consider writing for the local newspaper, magazine or real estate publication. Study the real estate market, interview the different players and report on it. You have likely spent money advertising in the local publications so they should be receptive to your suggestion.
In addition to the traditional press, there are numerous options online. Consider developing a blog with contextual advertising or becoming a contributor to another blog that has a large following and share in the revenue.
2. Do you love sales? If you love to sell, as many real estate agents do, consider developing a neighborhood website, newsletter or blog and selling advertising space on it. Connecting Neighbors (www.connectingneighbors.com/sponsor) offers a program, including marketing collateral and coaching for this revenue stream today. There are many real estate agents using the Connecting Neighbors program that make hundreds of dollars per month or more selling local advertisements. In addition to generating revenue, the real estate agent forms valuable partnerships with local business owners that often result in referrals or clients, thereby reinforcing the core real estate business.
3. Have you noticed an increase in foreclosures in your area? If so, there is money to be made in the foreclosure market. Perhaps you could partner with a local bank to help prepare and market properties it has repossessed. The bank may be willing to pay you as a consultant for this rather than through commissions at closing. Additionally, individuals may need advice and help relocating, so you may consider providing one-on-one consulting, seminars or information to these individuals. You may also partner with a rental company to help them find renters among those losing their homes. There is a lot of opportunity in the foreclosure market.
4. Do you enjoy assessing properties? If so, become licensed as an appraiser. This can open up revenue streams in the commercial market, which has not been as hard hit as the residential. In addition, banks holding foreclosure properties are in need of appraisal services in order to value their portfolio. Even consumers concerned about the value of their home will pay an appraiser for an assessment. Finally, with mortgage rates on the decline, the refinance market will likely pick up later this year creating increased demand for appraisers.
5. Do you know the area well? Offer tours of the area for visitors. The weak dollar and U.S. economy is driving up investment and tourism from overseas. Take advantage of that (and your nice car) to offer tours of your local area. This could work particularly well if you are in a tourist destination.
6. Do you speak multiple languages? As noted above, the weak dollar and U.S. economy is spurring foreign investment and travel in the U.S., so it’s a good time to market yourself to foreign buyers. Translate your website and offer consulting services to your broker or others to access these foreign buyers.
7. Can you make do with less space? Sublease your office or offer your conference room for other meetings and events. If you have a nice lobby, rent it out for parties and office events. Get creative with your staff and infrastructure.
8. Are you technical? Do you have a successful website? Do you understand search engine marketing well? If so, market your services to other similarly sized businesses in the community. Build your client base and maintain your expertise while generating a supplemental revenue stream.
This is no time to leave the real estate market. Remember, the National Association of Realtors® estimates there will be 5.7 million home sales by the end of 2008 (Robert Freedman, REALTOR.org, January 1, 2008), but to make some of those sales your own, you need to get creative. Assess the skills and assets of your entire business. Where can you add value to others?
You may not feel like you have marketable skills or assets, but keep looking. Get creative, leverage your skills and build related revenue streams to help support your earnings during this challenging market. When the market turns around, you will be that much stronger.
Bill Miles is EVP of Connecting Neighbors, a division of Reply! Inc. Contact Bill at firstname.lastname@example.org.