Looking back, we think we chose the perfect time to start our real estate business.
You have to love a good real estate boom. The property market was pumping and prices seemed higher and higher every day.
The week we opened for business we won 6 listings and the next few months were some of the busiest and most profitable of my real estate career.
There were so many agents and so many new businesses starting, but that didn’t matter because there were so many listings.
I remember saying “no” to a seller because their property was more than 20 minutes from our office.
Our weekends were stacked back-to-back with open houses that were only 30 minutes long because we had to squeeze so many in. There were dozens and sometimes hundreds of people waiting to look at a property as we arrived to hold the open house.
One week we sold 5 properties and we congratulated ourselves for taking the leap and opening our own business.
Then suddenly, everything changed.
Success in the real estate industry is more about the volume of sales than actual prices and when our market turned, the volume dropped by more than half almost overnight.
Suddenly buyers were not so frenzied. The number of people at opens was not so high and the media started to forecast a long and damaging recession that would eventually last many years.
We noticed how the former taxi drivers, school teachers, gym instructors and cafe owners were leaving real estate going back to their old jobs.
Then some of the larger real estate businesses around us started ‘restructuring’ or selling assets and laying off staff.
Quite a few would evenly go into bankruptcy or merge with competitors.
We had never seen anything like it but fortunately for us, we had saved everything we could from the good times and would need every penny to survive.
The first thing we did was scale our expenses back to the bare minimum. We were a new business so that wasn’t hard and there wasn’t much ‘fat’ to cut but we reduced every expense we could to prepare for an economic winter that would last more than 5 years.
Real estate businesses need listings to survive. Yes, it’s possible to work with buyers and eek out a living but it’s way smarter and far more lucrative to win a great listing because buyers will come to you once you have something that’s well marketed and priced right to sell.
We worked hard to reach out and connect with our established contacts but very few were selling.
As the months went by, property values continued to fall. Eventually some sales would be recorded at prices less than 50% of what they had sold for only a year or two before. We were smack in the middle of a stunning property crash and didn’t know what to do.
So we started advertising.
The newspapers told us that it was all about repetition and getting the message out that we were real estate guns for hire.
I remember chewing through $10,000 in less than a month with nothing to show for it but media bills from the papers so we sacked that idea.
Next we started dropping ‘Free Valuation’ flyers around our office in the hope we might attract a motivated seller willing to take a hit in a very bad market.
We got a few inquiries but nothing that would turn things around.
I have always been interested in marketing and decided to research direct response to see what might happen.
I started to look at my strengths and thought long and hard about what property owners were looking for and how I could offer them what they wanted.
Right from the start of my real estate career, I was very good at helping my sellers prepare their property for sale.
I have always been amazed how the same things clearly influence the sale of a property and developed a formula for making any property look its best in order to attract more buyers.
Somewhere along the way, I decided to write a small booklet that would share my formula with sellers to help the influence the selling price of their property even in the tough market conditions we were experiencing.
I called my booklet ‘How To Sell Your Home For More’ and, following the direct response ideas of great marketers like David Ogilvy, I designed flyers and direct mail letters to promote the booklet and offer a free copy to property owners. All that was left was to try this new idea.
In realty, this was our last roll of the dice. My brother and I both had young families at this stage and we were pouring our hard earned life savings into a business that was losing money way faster than we could make it.
I think it would be fair to say that our business was just a few months from closing at this point and I had to laugh to think back how I wouldn’t travel 20 minutes to sell a property during the boom. Right now I would drive for a day if it meant getting a listing and making a sale. Funny how things can change so fast!
At first my marketing didn’t work so well. We got a few calls but not the landslide of seller requests I was hoping for.
So I tweaked everything and tried again. Boom! The phone started to ring.
My marketing had worked and, as flat as the market was, many people were still interested to find out what their property was worth and some even wanted to talk about selling.
The first listing we won from our free booklet campaign was a run down apartment in a beautiful spot near the river.
I didn’t wear a suit to work for a week because I was busy completely gutting this apartment and repainting, refitting the kitchen then carpeting and polishing the lovely old timber floor. In fact I was there at first light working with trades people and contractors to create the ‘look’ I wanted.
The formula I developed called for certain paint and carpet colors and strategically placed furniture, lampshades, prints and other home style odds and ends that made buyers want to move in. The end result looked stunning. I couldn’t wait to begin advertising this gorgeous place and see what buyers thought.
Long story short, we sold the apartment for a great price and the investor owner gave us two more to sell. We were on our way.
Encouraged by the success of our free flyer campaign we did it again and again. Each time going a little bigger.
We started to target apartments as those owners seemed more motivated to sell. Word spread of our success and free booklet inquiries were a daily occurrence.
Many of the apartments we sold were to investors who wanted us to find them a tenant and manage the property full time. This is how we started to build an asset that we would eventually sell for many hundreds of thousands of dollars
The following year I wrote a longer book version of ‘How To Sell Your Home For More’ and did a publishing deal to get it into book stores.
Our success continued and we started to build our team. Other agents in our area began calling us to find out what we were doing. But we just told them we were working really hard.
Then agents from outside our area and in other states started calling so I decided to take back the publishing and do it myself so I could supply agents out of area who were not competing with us, with bulk copies of the book and the advertising ideas I used to get so many listings in such a tough market.
That was the very start of Bestagents and a business that has become my passion in life. I never tire of seeing Bestagents members do so well using my tools and ideas. They may never face a tough market like I did but they’ll know just what to do if it happens.
There were many times when I deeply regretted starting our real estate agency but if I hadn’t done it, I would never have learned so much about driving a business in such a tough economic climate.
I would never have learned about dynamic lead generation and the give-to-get marketing ideas that not only saved our business but let us thrive once things turned around.
Today, hundreds of agents use my book. In fact, I have ‘ghost written’ another book so other agents can actually build their own brand and become a published author just like me.
I wouldn’t say I’m a gifted writer but I know how to pull a story together to make it interesting and engaging and I know how to write a darn good direct mail letter that makes the reader take action.
These days I’ve developed a heap of marketing ideas based on the success of my first one and I love sharing these skills and concepts with fellow agents.
When it comes to real estate success, I believe I’ve cracked the code.