If you ask agents how long a person stays in a home, most will answer about seven years. NAR studies indicate it’s more like ten. Economists and social scientists are predicting that the time frame will become longer similar to what happened after the Great Depres
sion.
If people move less often, you’ll need more potential customers in your database to meet your annual goals. To produce 36 transactions a year where the average person moved every seven years, you’d need a group of 257 people if you got every transaction.
Assuming that people stay in a home ten years which makes a 10% turnover, 36 people would move each year from a group of 360 people. Without anything to justify this number, let’s assume that 20% of the people in your database would actually do business with you. That means you’ll need five times as many people or 1,800 names.
The conversion ratio would grow based on the people’s trust and confidence in you and if you maintained a strong position in the
ir top of mind awareness. Frequency of contacts will certainly help you maintain the top of mind awareness as long as you’re staying in touch without annoying them. The basis of your communications could actually build trust and confidence if they were constructed properly.
According to the NAR Profile of Home Buyers and Sellers, 61% of sellers and 50% of buyers select their agent because they had done business with them before or by direct referral. Half of buyers and almost 2/3 of sellers have this direct relationship of knowing or referred to the agent.
Since we know these people either directly or indirectly, let’s call them friends and the remainder of the potential customers would be strangers. It costs more to market to strangers and the results will not be as good.
Only 3% of sellers and 9% of buyers found the agent they used through the Internet. Don’t be seduced by the sirens calling you into the rocky, shallow waters of the Internet lead generation. Your absolute focus should be on the people you know and have done business with.
