The latest Profile of Home Buyers and Sellers from the National Association of Realtors provides an illuminating look at some particularly important trends for real estate professionals in the current climate. In a sense, they’re trends that confirm many pieces of common wisdom about the cornerstones of a successful real estate business, but it’s always interesting to have data to back up those intuitive and evergreen pieces of common sense. In this case, the current landscape confirms that real estate agents likeliest to win and keep clients do so based on expertise, delivery of positive experiences, and reputation and word-of-mouth marketing
1. Expertise Matters More Than Ever
In an environment where inventory is remarkably restricted, the expertise a real estate professional brings to the table has come to the forefront of consumer consciousness. Just 7 percent of recent home sales were done on an FSBO (for sale by owner) basis, the smallest share of transactions on record since statistics were first collected on the subject more than 35 years ago.
By contrast, a full 90 percent of sellers listed on the MLS (Multiple Listings Service), while 87 percent of buyers purchased their home through an agent or broker. Large majorities of both buyers and sellers indicated they would use their agent again in future. It’s a strong testament to the value that professionalism delivers for clients and a fact worth flagging in your own marketing efforts.
2. Positive Experiences Lead to Repeat Business
A key element in the willingness of many clients to recommend their agents for future businesses, and to plan on using them again, was the delivery of positive experiences throughout the processes of purchase and sale. Recently sold homes sold for a final sales price an average of 99 percent of the final listing price. Over 60 percent of buyers and 64 percent of sellers reported being very happy with the process. Customer satisfaction rates will likely never match up one-to-one with client retention rates, but the high confidence shown in these figures makes it clear that it’s always worthwhile to put quality customer service first.
3. Reputation and Word of Mouth are Critical
Several stats in the profile put the importance of reputation into sharp relief:
- 41 percent of buyers and 63 percent of sellers used real estate agents who were recommended by a friend or relative.
- 68 percent of buyers and 77 percent of sellers interview only one real estate agent before making a decision.
- The average seller has recommended their agent at least once since making a sale, and almost a third have had cause to recommend their agent to others three times or more.
It’s crystal clear that agents and brokers don’t get a second chance to make a first impression, and that word of mouth and referral remains a critical driving force in finding new clients. This certainly doesn’t discount the importance of being active online — over 40 percent of buyers are seeking out information online as the first step toward buying, for instance — but it’s hard not to conclude that a positive experience combined with expertise, and an ability to communicate that expertise and its benefits, can drive positive word of mouth in powerful ways that any professional must seek to access.