Are you a real estate CEO or a rainmaker struggling to keep your business afloat? Are you finding it harder and harder to bring in new clients and make sales? If so, you're not alone. Every business, at some point, hits a snag. The real estate industry is constantly in flux, and what worked yesterday may not work today. So, how do you turn around a failing real estate business? So read on for tips and advice to help you get back on track.
Common Causes of Real Estate Business Failure
The real estate industry is notoriously difficult to succeed in. In fact, according to the National Association of Realtors, 87% of real estate agents fail within the first five years of operation. One of the most common causes is spreading yourself too thin in your business. As a small business owner, it's easy to think that you have to do everything yourself—but that's unrealistic. You can't be an expert at everything, so don't try to be. Instead, focus on what you do best and delegate everything else.
Spot What Is Not Working
Another common cause of real estate business failure is failing to spot what is not working and then do something about it. This can manifest in many ways, such as using outdated methods or refusing to change your approach. So many technology tools are available to real estate agents now, and if you're not using them, you're falling behind.
Have a Diversified Business Plan
Many real estate businesses fail because they don't have a diversified business plan. In other words, they put all their eggs in one basket and then watch helplessly as their business crumbles when the market shifts. The secret of growing a real estate business is to have a diversified portfolio that includes a mix of different property types, locations, and price points. This way, if one market area starts to slow down, you'll still have other niches to fall back on.
Keep an Eye on Your Finances
Another common mistake that real estate businesses make is ignoring their finances which can lead to many problems down the road, such as cash flow issues and unpaid bills. Stay on top of your finances, and ensure you're always aware of where your money is going. This way, you can make necessary adjustments to your budget as needed.
4 Strategies to Turn Around Your Failing Real Estate Business
Real estate is known for highs and lows, with very little in between. When the market is good, business is booming. But it can be challenging to stay afloat when the market worsens. If your real estate business is struggling, here are four strategies to help you.
Strategy 1: Evaluate Your Current Situation
The first step in how to rescue your business is to take a close look at your current situation. What led to your business failing in the first place? What are you doing wrong that's causing you to lose clients and make sales? Maybe you're not putting enough effort into marketing or technology. Or perhaps your clients’ experiences are not up to par. Whatever the case, you need to identify your weaknesses and work on fixing them.
Strategy 2: Reach Out for Help and Advice
Once you have a handle on what led to your current situation, reach out for help and advice from people who have been through something similar. Talk to other real estate professionals, read books and articles on the subject, seek out a mentor or even hire a coach. You won’t regret it.
You don't have to go through this alone - getting help from those who have been there can give you the insights and guidance you need to get your business back on track. While you are panicking, your mind may not be in the right place.
So discussing your situation with someone knowledgeable and experienced can give you a better perspective and valuable insights. If you don't have the funding for any of these options, look for resources such as the free ClarityNOW Podcast series or take a crack at Gary Keller's "Millionaire Real Estate Agent" workbook.
Strategy 3: Go Back to Basics and Make Sacrifices
To save your business, you need to make some sacrifices. First, trim all unnecessary expenses, whether it is cutting back on your staging budget or giving up your office space. Then comes personal sacrifices. You may need to sell off some of your assets (like that second home) to keep your personal life and business afloat.
Next, put all your focus and energy into what made your business boom: getting listings and selling homes. You will see your business quickly turn around when you start making sales again.
Strategy 4: Make Use of Your Current Resources and Offer Ancillary Services
Finally, make use of your current network list. You may have lost some clients, but chances are you still have a list of potential leads. Start contacting them regularly and let them know you're still in business. And listen to their needs - they may be looking for a different type of service that you can provide.
For example, if you have a lot of property investment clients, you can branch out to property management, house renovation, or short-term rental management services. Other possible bundling services you can offer are title and mortgage services. By providing ancillary services, you can quickly gain another income stream and keep your business afloat while you turn things around. In addition, your clients will appreciate your efforts to meet their needs, and they'll be more likely to use your services again in the future.
There is no one-size-fits-all answer to turning around a failing real estate business. Every company's struggle is different, and the solutions that work for one business may not work for another. If you're struggling with a failing real estate business, don't despair. There are steps you can take to turn things around. By evaluating your current situation, reaching out for help and advice, stepping back to basics, and using your existing resources, you can put yourself on the path to success. So roll up your sleeves and get to work—your future depends on it!