Filling Your Sales Pipeline with Leads

“Farming is work. But, as I said before, what else are you going to do while you aren’t selling houses? I farmed.”

—Cathy Turney, Laugh your way to Real Estate Sales Success

An empty sales pipeline is the biggest stressor for a real estate agent. As soon as you close one deal, you need to be on the lookout for the next. Not every client needs your services right away. Some might take a few weeks or even a few months before they are ready to buy or sell. The best way to combat this is to always be prospecting, even when you are busy with clients. That way, you can maintain a steady workload without significant gaps between closings. This chapter provides a blueprint for doing just that.

Real Estate Sales Funnel

The sales funnel (also called a sales pipeline) is a visual model that illustrates the customer’s journey from first contact to final close. It is called a “funnel” because it starts wide at the top, capturing many prospects, and narrows to a smaller group of actual closings at the bottom. Some prospects will not end up buying or selling, or they will choose another agent, which is why the funnel narrows. The sales process moves people through this funnel.

There is a science to the sales funnel that you can use to predict your income and strategize improvements. For example, let’s say you had 8 closings last year and met 150 people who were looking to sell. You can calculate your conversion rate as 8/150 = 5.3%. We can also invert that number to determine how many prospects you need to meet to generate a single new closing, which is 150/8 = 18.75.

To conduct a more detailed analysis, we can divide the sales process into three stages: lead incubation, the listing presentation, and finally, a successful closing. For a prospect to result in a commission, they must first agree to a listing presentation, then sign a listing contract, and finally, the property must sell. At each stage, some prospects will not work out and will not result in a commission.

For lead incubation, you met 150 people, and 30 agreed to sit down for a listing presentation. That means you have a 30/150=20% chance of convincing a prospect to seriously consider you as their agent. In other words, to generate a single listing presentation, you would need to meet 150/30=5 new prospects.

For the listing presentation conversion rate, you had 30 presentations that resulted in 10 listing contracts. That means you have a 10/30 = 33% chance of success in getting someone at your listing presentation to sign on the dotted line and agree to use you as their agent. In other words, for every new listing, you need to make 3 listing presentations (30/10).

In your case, out of the 10 listings you had, you closed 8. This means you had an 80% chance of success in converting a listing into a closing (8/10).

Your real estate CRM can help you calculate these key statistics. This helps you better understand the improvements you might make at each stage and the impact those changes might have on your overall annual income.

What would happen if you improved the quality of your listing presentation and increased your success rate from 33% to 50%? In this case, you would go from 10 listings to 15. With a listing-to-closing success rate of 80%, you would close 12 homes instead of the 8 you closed last year. Your ability to be more effective with the same number of leads would dramatically increase your income.

One of the most common areas for improvement is your follow-up with prospects at the earliest stage of the sales pipeline. While most agents excel at initial contact, they often fail to follow through over weeks or even months. Industry research shows that it takes multiple points of contact to convert a lead, yet most agents follow up only twice on average¹. Your CRM can help you systematize follow-up, thereby increasing that conversion rate.

Assuming you have tightened your follow-through and are successfully taking listings through closing, the next area to explore is how many new prospects you meet each day and how that directly determines your commission income. You can then decide whether it is worthwhile to dedicate additional time and money to lead generation.

You can use your real estate CRM to identify which lead sources are working for you and which are not. Some lead sources might generate more leads, but that doesn’t necessarily translate into more closings. For example, you might find that working with prospects who have credit problems results in fewer closings per lead than working with first-time home buyers who don’t have credit problems. You need to look at your entire sales funnel to determine which lead sources are most efficient for you. If credit-repair leads are easier to generate, you might find the lower conversion rate acceptable. Your real estate CRM helps you identify these patterns and adjust your strategy accordingly.

Many agents believe that working a bit harder can increase their income. That is likely true, especially when you are new, but you will eventually reach a point where you sacrifice your quality of life to increase your income. This is where working smarter, not just harder, becomes critical. I recommend leveraging the information and analysis your CRM provides to identify ways to become more effective. If you can redirect your efforts from inefficient lead sources to those that are easier to convert, you’ll generate more income with the same effort. A new agent must initially work hard to fill their funnel with every possible lead. An experienced agent uses their CRM data to work smarter and refine the funnel for maximum efficiency and profit.

In the example above, a 33% chance of converting a listing presentation into a signed contract is at best average. A reasonable goal is a 50% success rate. A great way to work toward that goal is to find a mentor with a higher success rate and learn from them. Review their listing presentation materials, sales pitch, and objection-handling approach.

Dashboard to Dollars Secret: Your CRM can track both your deal pipeline as well as your past income. This is perfect for tracking progress towards a specific financial goal like making 20% more this year compared with last year.

Being a real estate agent is a labor-intensive job. A common strategy is to work with people you already know, such as past clients and friends. Because lead incubation with friends and past clients requires less effort than with fresh prospects, you can be more efficient with your time. You should also expect higher conversion rates when working with a past client than with a stranger. As you gain experience, you will have more opportunities to focus on repeat and referral business. It is only natural to prioritize your most efficient lead sources over less effective ones, and this shift clearly reflects that reality.

While I have primarily discussed listings, the same strategies apply equally well to buyer leads. There is a similar sales funnel for buyers. The three stages are the same: lead incubation, the buyer agency agreement, and a successful closing. Your real estate CRM will help you stay on track with follow-up and can even send automated time-release drip emails to your buyer prospects during that first incubation stage. New buyers are a particularly good fit for the prewritten, automated sequences built into your CRM’s content library.

A common strategy to improve efficiency is to prioritize listings over buyers. Buyers are more labor-intensive than listings, and scaling up buyers is harder. You can drive around only one buyer at a time, whereas you can have dozens of listings active simultaneously. You can use the statistics from your CRM to determine the mix of listings and buyers that works best for you.

Listings also have a synergistic effect on your ability to generate fresh buyer and seller prospects. A single listing can be used to market yourself and generate multiple buyer leads. Some of this lead generation will come from potential buyers arriving at your doorstep. For example, each time you conduct an open house, you’ll meet buyer leads. A less direct source of leads comes from your yard signs, which serve as advertising and generate calls from interested buyers.

While those methods generate leads with little effort, you can also actively capitalize on your listing by seeking prospects in the neighborhood. When marketing, ensure the central theme of your promotional activities and materials is the listed property. For example, send “Just Listed” and “Just Sold” postcards to the neighborhood. Another example is walking the area with a flyer before each open house and introducing yourself through door-knocking. Finally, once you close on the property, you can announce the home sale to the neighborhood through more door-knocking or postcards. You could even sponsor a block party to give the new homeowner an opportunity to meet the neighbors and for you to network. These activities could easily motivate other sellers, who are impressed by how you flawlessly handled the sale and the top-dollar price you negotiated.

Listing Leverage Secret: Maximize the benefits of each of your listings by treating it as a buyer-generation machine: use yard signs, call capture, open houses, and neighborhood marketing to create at least one additional buyer closing for each of your listings².

A third scaling strategy is to hire an assistant or bring on a partner. You can use sales funnel data to determine whether this change is justified and which activities the new person could support. Your real estate CRM is an ideal tool for coordinating with a partner or assistant. It lets you assign tasks, track completion, and delegate work to others, freeing you for higher-value activities like listing presentations.

Your real estate CRM helps you identify these patterns and adjust your strategy for maximum efficiency. While this book covers the core systems, my second book, Real Estate CRM Mastery, delves into advanced strategies for growing your business. It offers a multi-year plan to develop a geographic farm and shows how to build a predictable referral business from your sphere of influence. These long-term, system-driven lead sources enable an experienced agent to move beyond chasing individual leads and build a stable, leveraged business.

While the sales funnel is a great way to track your entire deal pipeline, a real estate CRM also helps you track each prospect and their progress through the sales process. This allows you to identify which leads need more nurturing and to schedule follow-up calls accordingly.

For your listings, your CRM provides ample notice of listings that may expire without a deal. By collecting showing feedback in your CRM, you can share a service report with your seller that scientifically documents what the market is saying about the property, its price, and condition relative to the competition. This allows you to discuss the possibility of a price adjustment and the need to extend the listing agreement deadline well before it expires.

By entering the source of each prospect into your CRM, you can determine which lead sources are working and which are not. With that information, you can focus your efforts on getting more of the types of leads you prefer and fewer of the ones that are less likely to close. Your CRM can even perform a detailed analysis to identify which lead sources convert at a higher rate than others. It is not just the quantity of leads, but also their quality, that needs to be considered.

Daily Prospecting Habits

Daily prospecting is an important factor in generating consistent income for a real estate agent. By creating a daily prospecting habit, you focus on the early stages of your sales funnel rather than just on closings and clients.

Your real estate CRM is the command center that keeps you organized and on track. Persistence pays off in prospecting, and your CRM can help you avoid the pitfall of giving up on a lead too soon. You also need to space out your prospecting over time. Nagging a prospect too frequently will not help, and ignoring a prospect will not yield results. Your real estate CRM allows you to scientifically regulate the frequency and types of communications you send to maximize your results.

The first step is to set aside time each day for formal prospecting. The best way to do this is to block out office hours in your calendar specifically for outreach and relationship-building. Office hours are a scheduled time for making outgoing phone calls. Use your CRM to generate a daily outbound call list. Use the CRM’s click-to-dial feature to make your calls. Prepare for each call by opening your notes from previous conversations, taking new notes, and scheduling a follow-up call—all within your CRM.

Prospecting Power Hour Secret: Schedule time in your calendar each day for outbound prospecting. By reserving this time, you can maintain a steady flow of new prospects. Think of this as your “me” time. At other times you are helping people buy and sell, but during office hours you are dedicated to generating new leads.

While it might be tempting to focus more on active clients than on prospecting, you should resist the urge to neglect your prospecting efforts. By scheduling time on your calendar, you ensure a balanced approach.

Before making a single outgoing call, be prepared. Develop scripts for each prospecting activity so you know what to say. Whether you’re canvassing a neighborhood before an open house, calling a new internet lead, or door-knocking, a script helps you speak confidently. Also, pre-qualify your prospects as part of your prep. For a buyer, ask whether they have a loan arranged, what their timeframe is, and whether they have the down payment or need to sell first. If you don’t know the answers, use those as discussion topics when you call.

You can use the real estate calculators integrated into your CRM to support this process. While others might view real estate agents as just salespeople, you should see yourself as a trusted advisor, helping your clients manage their largest asset: their home. It is essential that your client can afford their home purchase, that it makes financial sense, and that it also meets their housing needs.

Prospecting goes beyond data and scripts; it’s about the art of building connections and rapport. A great way to start conversations is through community engagement, which offers a sincere social reason to reach out that fits the moment and reduces resistance. Instead of cold calling, you might try caroling during the holidays, handing out flags on the Fourth of July, or delivering pumpkins for Halloween in your farm neighborhood. These seasonal pop-bys help you participate in your community and naturally lead to conversations.

When you connect with people, be an active listener and encourage them to talk about themselves. Your success comes from genuinely listening to their answers. This reflects a core principle from Dale Carnegie’s legendary book, How to Win Friends and Influence People, which states, “You can make more friends in 2 months by becoming interested in other people than you can in 2 years by trying to get other people interested in you.”

Ask about their career, hobbies, favorite sports teams, and vacation plans. Small details, like knowing which pets your friend has, make a big difference because they help you recommend homes with yards that meet those pets’ needs. This information is valuable intelligence that helps you understand their motivations and needs. Capture all this information in your CRM. Remembering a prospect’s children’s names or favorite sports team provides continuity over the years. By paying attention, you build trust. You can then provide professional advice based on your understanding of their specific requirements and what will make them happy.

Not every prospect will be ready to buy or sell immediately, which is why systematic, long-term follow-up is essential. After initial contact, you should assign a touch-cycle task to maintain regular contact. It is easy to make a single follow-up call, but a CRM is needed to schedule consistent follow-ups throughout the entire lead incubation period.

Be flexible with your communication methods. If a phone call goes to voicemail, follow up with a text message. If you have their physical address and the phone number is disconnected, drop off a packet of information at the house. It is best to schedule follow-ups one at a time, adjusting the timing and method based on your last interaction. A rigid, multi-step plan that cannot adapt to your prospect’s changing situation will fall apart quickly if anything goes wrong - and it will!

A well-equipped real estate CRM includes a library of pre-built drip email sequences for dozens of client situations, including first-time homebuyers, veterans, investors, and those looking to downsize. This is particularly valuable for new agents, who can use the library for inspiration and to understand different ways to nurture leads of all kinds.

Ping, Don’t Pester Secret: Time released emails tend to work best when used in moderation and when spaced out at least a week apart. If you send too many emails, people will just opt out. You are less likely to convert someone who finds you irritating.

You can use your CRM’s content library to provide value, but don’t start a drip sequence until you understand your first prospect’s goals. Generic drip sequences can irritate prospects and prompt them to opt out. A first-time homebuyer needs different information than a savvy investor. Similarly, use bulk emails sparingly. Sending information about your new listing to someone searching in a different city or price range shows you aren’t paying attention to their individual needs. Keep your communications targeted and relevant. Finally, recognize that leads have a limited shelf life. Track when each prospect was created, and review your database at least annually to identify old, unresponsive leads. Mark these contacts as “Cold” using a category so you can focus your energy on those most likely to convert into income.

New business from old clients and referrals from those who know you are just as important as fresh leads. Your real estate CRM can track who you have contacted, and when, and it can create a call list of past clients, friends, and family you should reach out to. Calling a friend on their birthday, the anniversary of their home sale, and sending annual Christmas cards are just three examples of relationship-building activities you should use with people in your sphere of influence. From a business perspective, these personal “touches” are a form of long-term prospecting, but their strength lies in genuine gestures of friendship³.

You should also identify a “Top100” category of people in your contacts database. These are the individuals most likely to recommend you or use your services again. Place these people on a 90-day touch cycle, so you contact them every 3 months. This way, you have an opportunity to maintain a good relationship and hear about referrals and repeat business opportunities. For everyone else in your contacts database, consider calling them at least once a year just to say “hi.”

A successful sales pipeline is built through consistent daily habits of prospecting and nurturing leads. Dedicate time each day to finding new prospects and nurturing existing leads. Use your CRM’s organizational tools to stay on top of your pipeline. This increases your chances of converting prospects and maintains a steady flow of new leads. Your CRM can turn the chaotic process of lead generation into a reliable system that fuels your business for years.

Using Floor Time

Floor time is when an agent is physically present in the brokerage office to handle general inquiries from potential clients who call or walk in. This duty, also called “up time” or “opportunity time”, allows agents to generate new leads and helps the brokerage ensure a representative is available to answer general questions the receptionist cannot. Floor time is usually assigned to new agents. Why? Because the people who drop by are unqualified leads, and experienced agents often prefer to work with referrals and their sphere of influence instead. However, a new agent may not yet have that pool of people to draw on and is therefore more likely to benefit from floor time.

Some people you meet during floor time will be highly motivated buyers. They might want to start looking at homes with you right away. While you might be tempted to start right away, your first step should be to pre-qualify your buyer. I recommend using your real estate CRM to gather as much information as possible during the initial interview. If the buyer has not been pre-qualified for a loan, connect them with a loan officer.

When you meet someone new, get to know them. Find out why they are thinking of buying or selling. This might be due to a life change, such as a new baby, marriage, divorce, or a job change. You also need to understand their financial circumstances. If they are buying, what price range are they considering? What is the timeframe? A great way to break the ice is to use one of the real estate calculators built into your CRM.

According to the National Association of REALTORS, nearly 40% of buyers take 70 days or more from their first contact with an agent before making an offer⁴. Because this process takes time, you should use your CRM to manage your follow-up, nurturing your prospect while they get prequalified for a loan and become familiar with homes on the market that meet their needs. Your ability to manage the transition from initial excitement to a qualified buyer and, eventually, to an offer is key to earning your commission check. Buyers are likely to be opportunistic about which agent they use, so your follow-up will be key to converting them into a closing.

Open House Strategies

An open house is a scheduled event in which a real estate agent invites the public to tour a home for sale. During a set time, typically on a weekend afternoon, potential buyers can walk through the property without a private appointment to get a feel for the space. It’s a marketing tool for sellers and an opportunity for agents to attract interest and gather feedback.

Notable Nametag Secret: You should consider wearing a nametag during open houses and floor time. This will help people remember your name and feel less awkward speaking with you. Your nametag clearly identifies you as the host, making it easier to solicit feedback and gather contact information. When you are face-to-face with someone wearing a nametag, they are more likely to address you by name verbally, reinforcing the connection in their memory.

An open house is a great opportunity to generate leads. While one goal is to sell the listing, it’s also ideal for meeting new buyer prospects and attracting neighborhood ‘looky-loos’ who might consider selling their homes soon. You will rarely find another chance when so many people are eager to talk with you.

A successful open house depends on thorough planning. Your CRM can help you create a checklist of tasks to complete before, during, and after the event, increasing your chances of attracting new clients and possibly even a buyer for that house. Post a sign the week before the open house with the date and time. Promote the open house on your broker’s website and on syndication platforms like ListHub, which distributes the information to Zillow and Realtor.com. Use social media platforms like Facebook and post on local sites like NextDoor. You can also use Instagram Stories to promote the event’s Facebook Live stream.

Consider partnering with a mortgage broker to produce a co-branded flyer with your information on the front and the lender’s sample payment terms on the back. It would be reasonable to ask the mortgage broker to cover the flyer printing costs and share some of the other open house expenses in exchange for their listing on the back of your flyer.

An open house is the perfect pretext to meet people in the neighborhood. A few days before, walk the neighborhood to connect directly with residents. Bring a door hanger or a flyer and knock on each door near the open house address to announce the event and extend a personal invitation to drop by. A door hanger is a small, printed card with a cutout that slips over a doorknob and stays in place if no one answers, so your invitation and contact details remain at the home.

Real estate coach Tom Ferry recommends this direct approach, framing it as a “neighbor-only preview” and a chance for neighbors to help “pick your new neighbor.” This is called circle prospecting and can be effective. Some of the best salespeople for a home are going to be people living in that neighborhood. You might also bump into a neighbor who is considering selling.

I recommend getting a large magnetic vinyl sign for your car that displays your contact information, including your name, brokerage, company logo, and a portrait photo of yourself. With this sign on your car, you are advertising yourself whenever you are in the neighborhood. The presence of your car with its sign in front of the open house also signals that you are inside. This is ideal not only for open houses but also for showings, where you might meet a buyer at the property.

On the day of the open house, set up directional signs with festive balloons to guide traffic and create a festive atmosphere. Before the open house begins, work with your seller to clean, declutter, and depersonalize the house. Consider baking a store-bought cookie dough roll before visitors arrive. The aroma of freshly baked goods is one of the oldest tricks in the book because it works. Scent is directly linked to the brain’s center for emotion and memory, instantly evoking positive, nostalgic feelings of home, safety, and comfort⁵. The goal is to make the unfamiliar house feel familiar. This welcoming atmosphere can predispose buyers to a positive evaluation of the property, and you can offer visitors a warm cookie as well.

Barefoot Buyer Secret: Place a sign by the door asking people to remove their shoes or to put on the disposable booties you provide. This keeps the home clean, shows respect for the owner, and gives buyers the impression that the property is of high quality and has been well cared for.

Your goal at an open house is to build relationships. Greet each guest with eye contact and a friendly handshake. Answer any questions they might have, but most importantly, ask questions to find out what the prospective buyer is looking for and what they think of the home. If the current house isn’t right for them, or if specific features make it a poor fit, offer to show them other homes that might be more suitable. Explain that, as a real estate agent, you are licensed to show them any home listed on the MLS. This pivots the conversation from selling one specific house to your expertise in the entire neighborhood and all the available homes, perhaps even a few that have not yet been listed. Your expert understanding of the town and the neighborhood makes you the perfect agent to find this buyer their forever home.

Rather than relying on a paper sign-in sheet, use an iPad or tablet running the open house app built into your real estate CRM. That way, guests enter their information directly, and it feeds into your CRM, eliminating manual data entry. This method is excellent for gathering information such as the visitor’s name, email address, and whether they are already working with another agent.

The Seller Security Secret: Insist on collecting contact information for every visitor at an open house. Greet every visitor with a firm but friendly script: “Welcome! For security purposes, the seller requires every guest to sign in before touring the home.” That way you can capture contact information for follow-up.

You should also bring printed materials, including property flyers, floor plans, and FAQs covering Homeowners Association (HOA) details and local amenities.

While a typical open house is held on a Saturday or Sunday afternoon after church and lunch, consider scheduling it at unconventional times. This tactic can help you attract buyers with nontraditional schedules. It’s especially effective for reaching retired buyers or those who work odd shifts, such as firefighters, hospital staff, and doctors.

Another option you should consider is using the call capture feature built into your real estate CRM. Instead of relying on your CRM’s open house form, ask each visitor to text or call your call capture number and enter a specific three-digit code. This method is faster for the guest and has the key benefit of capturing a verified mobile number. The main advantage of this approach is its simplicity. You can also increase the incentive for visitors by telling them that by texting your code to that number, they will receive the home flyer with the floor plan, home details, and asking price.

You can use your CRM to send each visitor from your open house a quick email or SMS while your name is still fresh in their minds. The best time is a few hours after the open house, but no later than 24 hours. Thanks to the open-house form in your CRM, you already have their names and phone numbers. First, identify each person’s level of interest. Focus on visitors who showed serious interest in this specific property—they require immediate, personal follow-up to discuss their interest in the home. Next, reach out to unrepresented buyers who liked you but not the house. Offer your expertise to help them find their perfect forever home. As an expert in that neighborhood, you’re the best-qualified agent to do so.

You can also solicit feedback by sending an email that includes a link to the showing feedback form built into your real estate CRM. When clicked, the link displays a photo of the open house and asks a few simple questions to gauge the prospect’s interest level and their impression of the home’s condition and price. Don’t underestimate the value of a simple text message. For example: “Jake here from the open house at 12 Main Street. What did you think of the home?” Sending a brief text message can often give you faster, more reliable results because many people respond quickly to texts and are willing to share a one-line answer.

Flyer Feedback Secret: Use the questions people ask at your open house to refine and improve your flyer and MLS descriptions. Sometimes specific features, like stainless steel appliances, or quartz countertop become trendy. If you can highlight desirable features, that can maximize its appeal.

You should also contact your seller after the open house to share how it went. The easiest way is to send your seller a link to the listing service report, which summarizes who saw the property and any feedback they provided. Even negative feedback is helpful because it can start a conversation about a necessary price adjustment or other changes that might improve the chances of an offer.

Traditionally, an open house is a public event hosted by the listing agent to attract potential buyers. A few variations focus on marketing to real estate agents and brokers instead. A broker open is a single-property open house for agents, while a broker caravan is a scheduled tour of multiple properties in one day. The core difference is the number of properties shown.

Both the broker open and the caravan are private events hosted exclusively for other real estate professionals, often held before the listing becomes public. The primary purpose is for agents to preview the home and generate buzz within the agent and broker community. Agents can share feedback on price and condition with the listing agent and network with other professionals. This also allows them to preview the home before showing it to their qualified buyers. Offering refreshments is a popular strategy among listing agents to attract other real estate professionals and make a positive impression.

As the host, I recommend collecting contact information from all visitors. That way, you can share price adjustments and other updates about the listing with attendees. You can also follow up with any agents who mention they have a client who might be a good fit as a buyer.

Broker Bowl Secret: Place a fishbowl at your broker open with a request that agents drop their business cards in the bowl with the price they think the home will sell for written on the back of the card. The person who comes closest wins a gift card to the restaurant of their choice and bragging rights as the most accurate agent. For the price of a gift card, you have just gotten a professional Broker Price Opinion (BPO) from the people most qualified to provide it. By making it a competition, you are less likely to get lowball estimates. You can load the contact information from these business cards into your real estate CRM by using a smart phone app which converts photos of business cards into contact records.

Each open house event gives you an opportunity to collect contact information. With call capture, the open house form from your CRM on an iPad, or simply scanning business cards with an app on your phone, you can have your CRM capture this information without having to hand-enter anything. Then, you can follow up using your CRM’s email, text messaging, and click-to-dial functionality.

The attention your open house generates also elevates your profile in the neighborhood, boosting your mindshare and increasing the likelihood that other homeowners will choose you as their listing agent when they are ready to sell. In short, an open house is a powerful marketing tool that can accelerate the sales process.

Paid Lead Sources

Paid lead sources are services that generate buyer or seller leads in exchange for a fee. These leads are collected through online advertising, property search websites, or marketing campaigns and then sold to agents. Common examples include Zillow Premier Agent, Realtor.com, and Homes.com. Agents pay per lead, per impression, or via a subscription model. While paid lead sources can quickly fill a pipeline, the quality of those leads tends to be lower than that of other leads.

Some leads will be fraudulent and have no real person associated with them. Others may be in the wrong geographic area and are therefore useless to you. Still others might not be serious buyers or sellers, or might be unable to buy due to poor credit or insufficient income.

The most challenging part of these leads is the limited contact information you are provided, often just an email address or phone number. This makes initial contact and follow-up difficult. For example, you might get a list of 30 people, and only one person will answer the phone when you call.

For this reason, you should expect the conversion rate for these kinds of leads to be low and that they will require considerably more persistence than other kinds of leads. You must use your real estate CRM to systematize your contact and follow-up with these leads. With these kinds of leads, it is a numbers game, which makes using the automation features of your CRM, such as email feed, click-to-dial, drip email, and touch cycle, critical.

You should expect that any paid lead source will provide you with non-exclusive information. Other real estate agents will also receive the same lead information. So, competition is fierce.

Paid lead sources such as Zillow and Realtor.com can be integrated into your real estate CRM via an email feed. This way, contact information is automatically added to your CRM, and you receive instant notifications by text message and email. Studies show that quick responses to these leads are crucial for conversion. You should expect that other agents have been given the same loads, and the first agent to establish rapport will win that client.

As a new agent, I recommend first maximizing every opportunity to generate leads through your own efforts, such as open houses, floor time, friends and family, and community involvement, before investing in paid lead sources. Paid lead sources naturally cost money, and as a new agent, the last thing you want is to spend a lot of cash up front.

There are several advantages to paid lead sources, which is why you will eventually want to experiment with them. You can think of paid lead sources as channels you can control to manage the flow of leads. The more you pay, the more leads you get. If you need leads quickly, paid lead sources are a great option.

A third type of paid lead source is data aggregation, which can provide you with a list of recent FSBOs, expired, probates, foreclosures, and non-owner-occupied homes. Instead of generating new buyer or seller inquiries through advertising, these systems aggregate existing data and deliver it in a format that can be loaded into your real estate CRM.

These lead sources can deliver multiple leads of the same type, such as FSBOs. This is particularly valuable if you’ve developed a successful strategy for nurturing that specific type of lead. For instance, you might have perfected a highly effective campaign for reaching FSBOs, using a carefully timed sequence of letters, phone calls, and postcards. You can use a paid lead source to generate these leads, and your CRM can nurture them.

Unlike leads generated from advertising, these leads are unaware that they are leads. They did not click on an ad or indicate they needed a real estate agent. These leads are not live and will not be loaded automatically via the email feed. Instead, you would load these leads weekly using your CRM’s valet import feature. For example, you might load a list of all the new FSBOs in your target area each week.

Due to the aggregated nature of these leads, you are likely to have several ways to reach each prospect, including email addresses, phone numbers, mailing addresses, and property addresses. However, some of the information, such as email addresses and phone numbers, may not be particularly accurate because it was compiled from multiple sources. Also, since you are working with prospects who are not expecting to be contacted, they might not answer the phone or hang up on you if you call them directly.

This means that incubating these leads will require a different approach. The best way to work these kinds of leads is to use your CRM’s automation features to create a multi-step task plan that involves multiple points of contact and communication channels. You might start with a printed letter, then a phone call, then a text message, and finally a series of postcards and even a drive-by visit.

The main advantage of these aggregated leads is that you can quickly generate hundreds of the same type of lead. This means you can work leads rapidly and often have too many rather than too few. Working these leads is ideal for an agent who is highly technical and proficient with their CRM’s automation features. The key to making these leads work is the systems you build and perfect over time. Like paid lead sources, working aggregate lead sources is a numbers game.

In some cases, you can gather this information yourself from tax records, your MLS, or lists provided by a local title company. While this is useful when starting out, the main value of these lead aggregators is the additional information they provide. For example, they will look up phone numbers to see if they are on the national Do Not Call (DNC) registry, a database maintained by the Federal Trade Commission (FTC) that allows consumers in the United States to opt out of receiving unwanted telemarketing calls. Real estate agents must check their prospecting lists against the DNC before making cold calls, as contacting registered numbers without permission can result in significant fines and legal penalties.

Companies that provide these kinds of paid leads are notorious for overpromising and underdelivering. They also tend to favor lengthy contracts, often a year or longer. As a result, it is easy to get stuck in a contract for a service you do not want. For these reasons, I recommend requesting an initial sample of the data to review the quality and starting with a short-term contract. If the leads are as great as the salesperson says they are, you can always convert your monthly membership into a longer one.

Another way to generate leads is to create your own website. When someone finds your website through a search engine like Google, it is called organic search. In today’s internet, it is increasingly difficult for a new website to rank organically in Google search results. This is because there are so many other real estate agents you are competing with who have established websites. You are also competing with larger competitors like Realtor.com, Zillow, Trulia, and Redfin.

You can boost your website’s visibility by paying Google, Facebook, and other organizations to display your advertisements, which, when clicked, lead to your website. This advertising is called Pay Per Click (PPC), as you typically pay a fee each time someone clicks the advertisement.

This kind of advertising involves creating ads that are geographically targeted to the city where you work and optimized for specific real estate-related keywords. When someone clicks your ad, they are taken to a dedicated landing page on your website. The advantage of this approach is that you have some control over your advertising and website content, allowing you to be more selective in targeting higher-quality leads and progressively improving the quality of your results over time.

However, as you would expect, this can take a significant amount of time and requires specialized skills. This is why most agents will hire an outside firm to manage their website’s organic and PPC promotion for a fee.

If you are interested in pursuing paid lead sources in more detail, I recommend my book, Real Estate CRM Mastery, for more experienced agents looking to take their real estate game to the next level. Paid lead sources may lack quality, but they more than make up for it in quantity. With experience, you will improve your ability to convert specific types of leads, such as FSBOs, and refine the automated systems that maximize conversion rates. Over time, you will be able to convert paid leads efficiently and profitably. For example, once you’re skilled at turning FSBO leads into listings, you can leverage economies of scale by purchasing FSBO leads and automating your efforts.

Rentals

You might think your job is strictly helping people find and sell their homes. I recommend expanding your job description to include rentals as well. Your MLS also lists properties for rent. Typically, you would be paid a “bounty” for finding a renter for a property. To do that, you could list the property on your MLS and use other traditional marketing strategies, such as posting on Facebook Marketplace and Craigslist and using yard signs. While that is not as large a payment as a commission on the sale of that same property, there are several advantages to providing rental services to your clients.

When the economy is doing poorly and real estate sales are slower, rentals are likely to pick up. So, by handling rentals, you are providing yourself with a diversification opportunity when times are slow in traditional real estate.

You might be working with a buyer who does not qualify to purchase a home due to insufficient income, excessive debt, or poor credit. Instead of turning these people away, you could offer your services to help them find a rental property. The incremental work required is minimal, as you do not need to prospect to get this client. They are right in front of you! By helping them find a rental property, you can also maintain your relationship. That means that when their credit has been repaired or their income is more stable, you can then help them become a homeowner. By providing these step-up services, you are helping people achieve their dream of becoming a homeowner, one step at a time. Rentals could be the first step toward becoming a real estate agent for life.

You might also work with a client who has short-term needs for which owning a home is impractical. For example, they may be military and will only be in town for 2 years. A rental property might be a more appropriate option for them. Your rent-vs-own calculator can help you make that determination. Some corporate clients need short-term housing for executives temporarily transferred. For these clients, fully furnished rentals might be a preferred option, particularly if they are coming from out of the country. Being able to provide these services to corporations opens the door to offering additional services, such as helping executives sell their homes when they are transferred and finding homes for employees who will be moving long-term into a new area. Your ability to offer full-service to a corporate client can make your services more desirable and, in turn, make you a preferred real estate agent for ALL their needs.

The Lock or Lease Secret: Don’t assume every buyer you meet should be a homeowner. Use the rent-vs-own calculator in your real estate CRM to determine if renting makes sense over home ownership.

A third kind of client who appreciates rentals is the investor. You might be working with an investor to help him purchase a property to fix up and either rent or flip. In that case, offering to find a qualified renter is a great way to extend that relationship.

Your connections with an investor can also help you close other deals. For example, if you start working with another investor who is looking to sell his rental property, you could connect the two deals and help one investor purchase from the other through a special tax-favored transaction called a 1031 exchange, which allows the seller to defer capital gains tax.

While we have been discussing helping find a renter and being paid a lump sum for that service, you can also extend your services to rental management, where you would be paid a monthly fee to manage the property. This would entail finding a qualified tenant, managing home repairs, and ensuring the tenant pays on time. You would be responsible for finding a new tenant should the current one leave. As in other situations, your ability to step up and offer these services could allow you to expand your service range in ways that make you a more desirable real estate agent for some clients.

One final advantage of handling rentals is that it helps you better understand the rental market and how to service them. This experience could be useful if you ever decide to be a landlord yourself. Many real estate agents own rental properties, and doing these services for others lets you make mistakes and learn on someone else’s dime. It also gives you economies of scale, since handling five rentals is only incrementally harder than handling a single rental.

Short-term rentals on platforms like VRBO or Airbnb have also become an established option for managing these properties, whether for a few days, a few weeks, or even a month. Increasingly, corporate clients are relying on these kinds of rental properties for their executives when short-term housing is needed, so you might be able to leverage your ability to provide these services to corporate clients.

Your real estate CRM can easily track both renters and landlords, just as you handle the home sales process now. The closing on a rental is much easier, but the steps are similar.

Some full-featured real estate CRMs can handle rental management as well. Typically, this includes tracking rental payments due and paid, organizing repairs, and billing the landlord for your services and any repair costs. As with your regular real estate business, you must maintain a good list of service providers in the contacts section of your real estate CRM, such as a handyman, plumber, house cleaner, painter, and yard maintenance, among others.

Commercial Real Estate

Did you know that licensed real estate salespeople can sell both residential and commercial properties? Commercial Real Estate (CRE) refers to property used exclusively for business purposes or to generate income, rather than for personal residence. It encompasses four main categories: Office (e.g., corporate buildings and medical offices), Retail (e.g., shopping centers and standalone stores), Industrial (e.g., warehouses and manufacturing plants), and Multifamily (apartment complexes with more than four units, considered an income-producing investment).

In many cases, commercial properties for sale or lease are not on the MLS but are instead listed on commercial real estate portals like LoopNet and CityFeet. For this reason, it is helpful to use a real estate CRM with a properties database, also known as a homes database. That way, you can collect statistics on properties for sale or lease, such as square footage and building features, independent of your MLS. If you want to pursue commercial real estate transactions, select a real estate CRM with a properties database.

Similarly, you would maintain a list of buyers and their needs in your real estate CRM. You could then act as a matchmaker, connecting the properties database with the buyers’ database.

Many commercial real estate agents handle both leasing and sales of commercial properties. This is because the commercial leasing market is much larger than the sales market. While commercial sales volume in the U.S. ranges in the hundreds of billions of dollars annually, the total value of all rent payments across the country’s entire commercial lease inventory is several trillion dollars annually. Some of the best real estate CRMs can gather both rental and for-sale information from their buyer and property databases, covering residential and commercial properties.

There are several reasons you might want to either specialize in or dabble in commercial real estate.

One advantage of working in commercial real estate is that it does not follow the same economic cycles as residential real estate. Corporate tenants and investors seeking multifamily investment properties typically have a longer timeframe and may be more active when the economy is down. Working with businesses and investors provides an excellent form of diversification for you should the economy turn sour.

Another advantage of working with investors is that they often pursue properties that more traditional buyers might shy away from, such as higher-priced, distressed, or difficult-to-show properties. By working with at least one commercial buyer, you can access properties that might otherwise be challenging to sell.

Commercial buyers may be driven by different incentives than residential buyers. For example, a commercial buyer might wish to close quickly to take advantage of tax-favored status under the 1031 exchange rules. A 1031 exchange is an IRS provision that allows a real estate investor to defer capital gains taxes when selling an investment or business property, provided they use all the sale proceeds to acquire a “like-kind” replacement property of equal or greater value. To do that, they would buy and sell a property within just a few months. This could give you the opportunity to do two deals for a buyer whose primary incentive is not price but timing.

Typically, commercial real estate is priced higher than residential real estate. Deals can be more complex and take longer to close. As a result, an agent specializing in commercial real estate might handle fewer transactions, but the final commission is much larger. The average annual income for commercial real estate agents is more than double that of residential real estate agents⁶. For these reasons, using a real estate CRM to track contingencies, deadlines, parties involved in the deal, and progress toward closing is even more critical than in residential real estate.

The line between commercial and residential can sometimes be blurry. A typical scenario is that you help a client purchase or sell a residential property, and then they call on your services to handle a commercial transaction. Your ability to deliver a full level of service provides immense value to your clients. After all, they already know and trust you for their residential real estate needs, so they might prefer to work with you on a small commercial transaction, even though you are not a dedicated commercial real estate agent.

While there are commercial real estate-specific CRMs, it is not uncommon for commercial real estate agents to use a residential CRM. Residential CRMs are far more affordable and offer sufficient features to handle most commercial transactions.

Endnotes

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