One answer is to do something different. Our team is often asked, "Do you handle rentals?" to which our response has been "No. We don't like property management." Then more of our sellers with unsold homes started saying they wanted to rent or sell, whichever comes first. Now, it's one thing to refer out rentals, but it's a bit more awkward if you refer out a "whichever comes first".
So we've found some tenants and found some income for some of our homeowners. We've also found rentals for some clients who can't yet buy a house because theirs back in ---- hasn't sold. We've referred them out, told them we don't handle rentals, and then they've come back pleading for help. OK, we'll help.
While I still don't want property management, I have found some rentals that I enjoy and that are worth my while - condos in downtown St. Pete. We'll work with owners to find renters, or with renters to find condos. With a condo association taking care of landscaping and pool issues, and an insurance policy to take care of most repairs with a call directly from the tenant, it's not so bad. We can walk from our office to the condos, so we don't have lots of driving expenses. So, now I've added Downtown St Pete Condo Rentals to our offered services.
Are there some condos where the agent is offering a $50 or $100 coop fee? Yes. And some offer 25% of a month's rent, and one even offered half a month's rent. But we're solving a client's needs at not so great time or expense, and have a good lead and relationship for a future purchase. So, yes, I'll work with tomorrow's buyers today.
If you aren't selling houses ... ... maybe you could stay in real estate and:
handle rentals
handle property management
offer real estate consulting services
provide research services for out of town clients (hourly $)
learn about foreclosures and short sales and specialize in those
Every situation, every market condition, has opportunities. You just need to find it and capitalize on it.
A market like this one requires readjustment. I have started working with more investors (it's a great market for them) I am also doing BPO's and handling some local commercial properties. Gotta pay the bills however I can!
Sharon, I agree, I do not want to do property management, yet need to diversify in slower markets - thanks for the input!
Sharon. Love your new photo.
Our business is very slow and I've responded by
Your new photo is awesome.
One of my agents has worked rentals almost exclusively for 20 years and makes a very nice salary. I don't let my other agents "dabble in rentals" though. In my opinion, as a broker owner, there is a huge liabilty with rentals especially concerning discrimination etc. My rental agent attends classes every year to stay up to date with the latest rules/laws etc. I'd advise that of anyone who is going to start dabbling.
Sharon,
That all sounds like a good idea, but I'm new to the business; just getting my feet wet and not sure I want to explore that avenue as of yet.
Since I got my license in 1978 when interest rates were in the high double digits, we had to learn different ways of selling houses from day 1 or find another job.
I chose to learn about seller financing and lease options; it still comes in handy.
Fortunately our market in east Tennessee is fairly robust right now so homes are still selling.
I typcially am weary of rentals, but right now, every little bit counts. I went on an interesting apartment hunting session this week - saw some awesome NY style loft apartments in Allentown. Not sure if anything will come of it (one of the two did get rented).
I'm not a new agent, but haven't worked a lot in that area - so it also was get to know the area.
I still need a secondary reason to work with rentals just because I've had such terrible luck with them - and I mean "luck".
Lori - good for you for diversifying. Maybe you'll like some of these niches and stay with them.
Andrew - thanks. Good luck in surviving the mortgage challenges! If you come across unattached buyers looking for preapprovals, be sure to connect them with your Realtor® business partners - we all need each other.
Carol - if you don't like property management, don't do it. Go find another Opportunity.
Lenn - I never would have guessed your Shopping More. Interesting to see that you're now working with - and seeking - buyers in your neighborhood. Kind of like my working with renters in nearby downtown condos. I'm doing the same on referral relationships, have scheduled to attend 3 luxury conference to reconnect with agents I've met in the past and make some new ones, in Vancouver, Santa Fe and then Scottsdale in January.
We didn't want to do rentals at first either but when you can't sell a house for the amount the sellers need then instead of referring away customers we've helped them. It is what it is. And we're doing the short sale / pre foreclosure sales also.
We don't really go after this type of business (rentals) but definitely handle it when the need arises.
I like Lenn's comment about not shopping as much - I've implemented that one too :)
Great reminders for a slower market.
Teresa - I like your first sentence. Our county had 7,188 transactions in 2007 through August - and the Pinellas Realtor Organization has 7,000 members. Hmmm. Winter is generally our best selling season here in Florida. When your business halts, come down and visit.
Linda - Thanks for the photo comment. Yes, you're smart to have your agents educating themselves. Discrimination can be nasty. One concern here with houses is when several college students want to rent it.
Connie - you're right. Concentrate on learning the basic business. Niches can come later.
Jim - glad East Tennessee is doing well. Flexibility can't be overestimated. Our years or experience in changing markets does come in handy.
Judi - if you don't need to go outside what you're comfortable with, that's great.
Diversification is good. Multiple Streams of Income is what we all should have thought of a while back.
Others ways to create income is to help other agents increase their business. An article I recently published
"How to turn one hundred dollars into Thousands" was a great hit. Agents and other professionals want to find multiple streams of income without having to invest a lot of money and they don't want any Multi-level marketing programs.
The company Is MXLjet.com. Check them out. When they ask you for a code to get the discount hit BN1531. They are not an MLM and offer agents a a way to make extra money. In fact below I will give you their links.
http://www.mlxjet.com/
The above link is to a company that is outstanding in creating email Brands. You must have this if your goal is to establish any type of branding in your field. The old method of emailing has become obsolete. All e-mails must have a branding template or be Video -email ( For video email programs, call me or email me for details)
http://www.mlxjet.com/nonrealtor/
The above links are templates for those people not in the industry. Do you know any - one not a real estate agent but in the business of selling or offering a service? These templates are designed for them
http://www.mlxjet.com/reseller
The above link is your opportunity to earn passive residual income. ( THIS IS NOT A MULTI-LEVEL MARKETING COMPANY) If you refer anyone to them, you can earn up to $600.00 per client in passive residual income. You must see this. I am very excited about the product and the ability to offer you passive residual income.
http://www.mlxjet.com/moneychart/index.html
This site gives you an idea how much money you can actually make.
Sharon, we were having so many people renting and looking for rentals that I was on the form committee to write up a standarized form. I was seeing everthing under the sun. I found a small property manager to committ then empty house too if it didn't sell and they want to rent. Not everyone on my team has the time, but a few do so they get all the rental buyer leads. They are grateful for the small amount of money.
It is a strange market, but we make it work. Someday the rentals will go back to sales. My daughter did a rental for a new single person starting a new job, last year. This year she called Christa and was ready to buy. One trip out she found what she wanted and sold and closed.
Brett - isn't implying that "generic listings" are your own listings against the Code of Ethics of NAR?
Missy - Glad you got something standardized. Congratulations to your daughter, Christa. Is she on your team?
Chuck - those who flex, win.
You say when houses are not selling. No houses are selling in your market? Not trying to sound rude but I find it hard to believe that there have been no sales in your market.
Instead of trying to find other ways to make money, we just need to adjust to a different market and adjust the way we find buyers and sellers.
We've been doing rentals knowing that renters will turn into buyers - We actually started in property management before sales and still manage commercial and retail properties. (It's nice to have steady income that is not affected by ups and downs of the market).
I do see a negative in agents that normally do not do rentals - we're dealing with a couple now that don't know what they are doing and they are turning an easy process into a nightmare which ultimately makes us look bad.
You make an excellent point. We shouldn't put all our eggs in one basket. We should diversify our income streams ;)
Cheers,
Cindy
I'm thinking of becoming an international jewel thief..
Seriously, consider working on your referral networking and buyer prospecting. If you enjoy teaching and have experience, look into real estate education. Maybe consider the commercial real estate market or change your specialty area in some way.
When I first began, about two years ago, most of the seasoned agents I ran into said "I don't do rentals. They are a waste of time." I didn't understand what they meant and went after them. The problem soon became clear. There were far too many large complexes drawing the same people in with their web sites. I would spend hours with prospects only to find they signed a lease with Avolon the next day. I wish I COULD make rentals work, but there are numerous large complexes that refuse to deal with agents. Our MLS has relatively few listings for rentals - the vast majority are held as "open listings" within the specific brokerages. So even when the prospect doesn't go to one of the 4 Avalons, or Bank St. Commons - they often disappear and rent with another agent who holds a privately held listing.
The difficulty is that unlike sales, there are too many other places for the prospect to go where I have no access. Showing the units is just as time consuming as sales - if not more so - but the pay is terrible. When you account for the attrition, we are down to pennies/hour.
If anyone has any ideas for making this profitable, I am all ears. I do LIST rentals because that isn't so time consuming, but showing units appears to be a lost leader around here. I'm looking for any ideas. I get inquiries all the time, but they are generally looking for Section 8 or the cheapest thing around. When they see how pitiful the selection is, they resign themselves to paying more, but then they run to one of the major complexes and I am out of the transaction.
Sharon,
Some great suggestions--many of the agents I know well are doing all kinds of interesting sideline jobs from Ebay to new kid franchises. We are a very resilient bunch!
Yes, houses are selling in our market. In the first eight months of the year, 7,188 properties sold in Pinellas County. Since there are 7,000 members of the Pinellas Realtor Organization, that means that the average agent is selling a property once in 8 months. Many agents are finding jobs outside the real estate industry - my point was that there are sources within the industry that are also options. And yes, certainly we need to adapt to a different market.
Carol - a new niche often results from trying to serve our clients' needs, especially when they're not being served properly elsewhere.
David - that's exactly the point.
Gary - I'm glad you're in one of the pockets that are thriving!
Ines - you're wise to have a steady income to supplement the sales. Definitely anyone going into a new "field" should get the education to do it properly. If they don't, they aren't looking out for their clients' interest.
Cindy - yes. Hopefully we can do it within our industry instead of going outside.
Joan - having investment property is always a good idea (when well chosen, of course). It's unfortunate that those people going back to prior careers and becoming part-time agents aren't as available to increase their real estate business and effectiveness.
Brad - wisely spoken. If you learn great things at seminars, classes and conferences but don't put them to work, they're pretty useless ideas for you.
Eric - I like your serious suggestions of opportunities for branching out within the industry.
Bob and Carolin - indeed we do.
Ruthmarie - just as in sales, you don't need to work with every potential renter. Choose the area, price range, type of property that interests you, and brings the clients you'd want to work with in the future. As for lots of showings with a resulting loss of client - use an exclusive representation agreement with a potential renter as you would with a potential buyer.
Ki - sorry, I missed your point.
Chris - Thanks. You're right - there are lots of ways to make lemonade.
Diane - I imagine some of those agents will find they like the sideline jobs better than real estate,
Sharon,
I am certain that your post will touch a nerve with manywho read it. As a Loan Officer/Mortgage Broker the primary source for my business has been Realtor referrals. So many are struggling! Hopefully your post serves to help and spur thoughts/actions.
Even as a loan officer trying to focus on survival and business flow I have tried to add a little levity here and there when discussing the current state of affairs in our respective professions. I jokingly say I have my application ready to be a Walmart Greeter and have my greeting down pat....Hi....Welcome to Walmart!
Bottom line is there are always options and there is "Opportunity in Adversity", search for it if you are a professional and want to survive.
And...great new photo!
I came into this business with commensurate life and business experience. I can't imagine what Realtors who have no other background will do, in markets greatly affected by a downturn.
As far as Starbucks, this season, the spiced pumpkin latte is delish' !
I knew a top producer who's now selling appliances.
You gotta do what ever to pay for that BMW
When houses aren't selling is the time to make sure that the houses that are for sale look exceptional. Perfectly presented both inside and out. Competition is stiff and for this reason you want to make sure that your listings look fabulous, better than all the rest. Every real estate agent should have the knowlege to guide their sellers through the process of staging. Now that there is a lull in the market is the best time to educate yourself in 'The Power of Staging'
Andy Capelluto
Sharon - I have gotten lots of calls about rentals and in the past have not handled them but referred them on, or suggested where people can look, primarily because I don't know the rental market and don't feel I can represent these prospects. I am seriously thinking about doing more in this market now, since the demand is there and the income doesn't hurt. And perhaps I can assist those who might later need to buy.
Jeff
survivors survive
I can't believe how many people in this industry are still narrowly defining what they will and won't do
"I won't sell real estate outside of a 2 mile radius of my home"
that's just how NOT to make money
I say go where the money is... so what if it is less than last year or the year before - it is better than nothing
there will be some people who will fall out of this industry thanks to mounting bills and no income... but that just opens up our old niches when we get the market back
and while we're waiting, we can create new opportunities that we may like more!
a dynamic industry required dynamic professionals
Sharon,
I've tried that. But NO ONE wants to PAY for it! I get a lot of requests to find units for people with pets. The minute I explain to them that if they engage me I must be PAID - they run away. The prospective tenant comes to me expecting the landlord to pay and the landlord expects the tenant to pay. The trouble is that around here the system as pretty much cut the agent out of the deal. It really has. We have very, very few listings on the MLS for rentals because most landlords don't want to pay a fee. Some put down $1.00 to get the exposure - but that puts it back on the tenant - and they won't pay unless what they are looking for is so impossible there is no alternative.
Unfortunately, there are far too many viable alternatives to the real estate agent out there when it comes to rentals. Most tenants are correct in the fact that they really don't NEED to pay. Just go online and find Avalon or Bank St. or one of the other large complexes and off they go. If there is no NEED, they won't pay for it.
Since I am geared to sales for people with pets, I take these prospects email addresses and send them newsletters - in the hopes that some day they will buy. If you have the down-payment and the credit - buying is cheaper than renting in our area. But if they won't pay at all , its a no-go for me. I have found from my former field that when you work for free or for peanuts, no one respects you. That does not bode well for procuring these prospects as buyers later.
I've been trying to find a way to MAKE this profitable...because so many potential buyers are being squeezed out of the market right now. But I can't seem to find a way to get it to work for me. The pet angle MIGHT work - but unless someone is willing to pay for something - there is little I can do. If I make it a free service, my time will get soaked up and MY home will be the one under foreclosure.
You look great minus your poundage...... I went on a diet today.
The post was great and made you think.... THanks
I was wondering when someone was going to post about something like this.