Marketing to Real Estate Professionals?

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Mar 5, 2010 4:10 pm

I'd appreciate your feedback on this one:

For a host of reasons I'd like to target real estate professionals.  Real producers, not part-time agents.  My practice is financial planning based however a lead in on a solo(k) helps differentiate myself since most people don't know about them and the cost for our firm is only $15/yr, not the couple grand it takes at other shops.  So there is some differentiation there.  If they are a team etc perhaps a Simple or SEP.  Also, I think they are a lot more approachable than CEOs & Execs, and by the news & records it's easy to see who makes money to concentrate my efforts.
 
That being said, have any of you targeted them?  Brokers, Agents, etc.  I'm thinking about doinig a 'summit' for them with a lender, IT techy, Mktg people, as well as get it sponsored by contractors, appraisers, P&Cs etc. 
Has anyone had any success in targeting them?  If so, how?  Why or why not?

Mar 5, 2010 4:18 pm

If they are successful(about 2% of them), they have a broker. They are experts in networking and referral trading. Considering that the RE market is in the crapper, I would question your timing.

Mar 5, 2010 4:46 pm

I loive along the coastline, so a lot of real estate, and high-end real estate.  There areprobably 500 agents covering my region.  I would say 10 of them probably do 70% of the deals and 90% of the revenue (we have your typical 285K neighborhoods, and then lots of $1mm+ homes).  And those 10 are the ones selling for real estate developers, business owners, lawyers, advisors, doctors, etc.  Point is, I highly doubt ANY of the big hitters in real estate in my area are in need of another advisor.  Their JOB DESCRIPTION is to network with these kind of people.

Mar 5, 2010 5:55 pm

I run a mortgage company (hence the name yield spread) and do target realtors.
There is good potential there.
1)They go through many peaks and valleys in income.  Some months they brings in tens of thousands and then ther months bottom out.  They need advice on planning.
2)They know people with money as they know when someone is getting a large lump sum from selling thier house.  Guys sells home when kids move out buys condo/townhome puts dpown 20% needs to invest the rest.
3) Depending on how close they work with the loan officer they will see all investment accounts. 
Best time to meet with a busy realtor is in the morning.  Our world really doesn't start buzzing until 10am when rates are published.  Their customers work during the day so its a nights and weekends job.
Realtors are looking for any help in marketing.  We put on home buying seminars for a group of realtors that lasts about 45 minutes and includes realtor, loan officer, cpa, title rep, insurance agent and sometimes an advisor.
Not only will you get in front of investors but a group of professionals who can reffer you business.
But here is the catch-realtors are by far away a very difficult group of professionals to tolerate.   
Other posters said they have already have advisers----thats not a bad thing-why would you want a client who has never had an adviser? 
My largest client-the wife is a realtor, although this is not they hve accumulated wealth.  Trust me she spend every dime she gets.  They had a seven figure account at Merrill in MFA Selects-an easy steal.
Bottom line-good market-believe everyone needs your help regarding of who is helping them now and find a way to help them grow thier business and they will help you grow yours.  Realtors are all about refferals, thats how they eat.

Mar 6, 2010 11:04 am

Dealing with Realtors can be difficult as yieldspread notes, but they are worth the effort.

The thing to remember when targeting them is that regardless of whether or not they are successful Realtors, they more than likely career changers and therefore should have a rollover.

They also have no company sponsored insurance...life or disability.

You will go through dozens to get one worth your time, but thats why we qualify right?

Mar 6, 2010 8:12 am

What is a real estate "professional"?
Not a realtor.

Mar 6, 2010 8:31 pm

If you want to get in on real estate transactions, just refer to the local papers for real estate sales. Names and amounts are published. Money in motion. Call them with your best idea and set the appointment. The sellers may have excess cash to reinvest or the purchaser may be new in town and in need of a new advisor, or life insurance to cover the mortgage at the very least. Also call owners of title agencies- In the middle of real estate transactions and good referall sources without the mental problems realtors have. Better targets for solo 401(k)'s could be plumbers, consultants,etc. with a more stable income and who aren't getting hammered by other advisors
Stok

Mar 7, 2010 9:22 am

My brother is a CPA that specializes in Real Estate. He has introduced me to a lot of the Real Estate "people to know". I don't think this group is worth it............other then using them as a COI. I would not expect to get their business. To them, there is only 1 investment...........Real Estate. Most of the true "players" in my area put all their money into the next development deal, land or some condo complex. I won't waste my time anymore.

Mar 8, 2010 12:03 pm

Real estate agents make the worst clients.
1. They treat their SEP ira's like bank accounts, always pulling money out for lean months.
2. They don't understand the stock market.
3.  They live hand to mouth, hardly save anything.
4. They love to invest in flip houses, rentals, and other things they think they understand.

Mar 8, 2010 2:10 pm

There are real estate "professionals" and then there are real estate "agents".  The only professionals I would get to know are developers and brokers.  As I said before, most of the transactions in my area are being done by the top 5-10% of agents (and/or the broker themself).  And the broker is making a killing off all his little part-time agents.
Here's another angle....look at the town/city/county tax roles.  Sort it by owner and see how many names come up multiple times.  That will give you some indication of who has some serious wealth in town (yes, most wealthy people either own real estate or businesses).
The fact is, almost ALL wealthy people have some serious amount of real estate holdings, regardless of where they accumulated their wealth initially.  Between the leverage aspect and tax advantages, real estate (other than primary residences) is a great source of long-term wealth building.

Mar 9, 2010 9:38 am

Thanks everyone for all the great insight!  I greatly appreciate your constructive feedback.

Yes, the reason why I use the term professional is to stress that I am not focused on just any agent/broker, and I realize that there are a lot of unsuccessful, unprofessional people within the industry.  Perhaps the turn in the market has also weeded out them. 

Navet - I live in the mid-atlantic in a metropolitan area so the real estate market has not been hit as much.  A benefit of this though is that it has elimintated a lot of the part-timers and left more of the professionals.  I'd prefer them to have a broker as this would mean that they've been investing.  I just want to take the accounts and position myself as a financial planner & retirement plans specialist for real estate agents to win the business.  I realize that this may be hard to do because they don't want to burn bridges with anyone because they may be referral sources as well.

B24 - I know a lot of you all focus on doctors and attorneys.  I feel that REPs are less marketed to and much more approachable than doctors and attorneys.  Plus word-of-mouth travels with them, and they might refer me to their colleagues.  Also in my Metro area just in this county alone the Realtor assocation has 4,000 members.  Not to mention other groups and neighboring counties. 

Yield Spread - Thank you for all the insight.  Were those workshops for homebuyers or professionals?  If you're marketing to REPs how do you combat that they might be working from home.  From what have you gotten the best response (Cold Calls, Cold-walking, Sales Meetings, Speaking Engagements, Letters, Postcards, Handwritten cards, Workshop/Seminar, Event, Association Conference/Tradeshow)?  Yes, if they had an advisor they would probably be a much more qualified prospect, so I'm not afraid of that.  I agree, I can see how they'd be difficult to work with.  I am hoping to screen out all of the "un"professionals as much as I can.  Even so I recognize they will have a lot if not the majority of their assets tied into personal real estate deals, that being said I still believe they could invest enough and give me enough business with the assets, financial planning, and insurance.  As a sideline I had never really seen the benefit of working together with a lender, them having insights into the investments was something I hadn't thought of. 

Jack the Bear - Exactly, I'm also looking at ways to qualify them.  This should be easier to do than other professionals like doctors or lawyers just by the fact that their sales are public record. 

Stok - Yes, I'll be reading the papers to see the money in motion at least on the real estate professionals side.  I don't have the money or the focus to market to the professional and the consumer.  Any referrals will be ancillary.

LLcoolJ - How does your brother specialize with Real Estate Agents?  What are the services he offers?  I have a strategic alliance with a CPA and would be interested in getting him in on this niche as well, since we already share a REP client. 

PremierAdvisor - Yes that is exactly what I want to stay away from.  I think as long as they recognize the tax benefits of a solo(k) and the fact they can do more with it than a SEP they will be more motivated.  Don't you think the financial markets will rebound before and/or more than the real estate markets going forward.  Also, I'm going to eliminate the part-timers and qualify the real producers.   

B24 - Pardon my ignorance what are the tax roles?  I can look up individual properties for the owners but how would one get lists? 

Thanks again everyone.  I greatly appreciate your feedback.

-yb

Mar 9, 2010 10:54 am

YB,

Sorry, that was tax ROLLS not ROLES.  It's the lsit of real estate tax payers in your area.  Usually your municipality posts them somewhere on the internet.  You have to do a little digging, but you can usually find them.  Try Googling a big taxpayer in your area, and sometimes it will connect you to the taxpayer grand list or something like that.

If you are really serious about targeting RE agents, and there are 4000 of them, then maybe seminars targeted specifically at THEM would work.  It would be easy to market.  Just send flyers/e-mails (whatever compliance allows) to all the local offices and start collecting business cards (with e-mail addresses).  LOts of them advertise, so pick up those rental guide and real estate magazines they have ouside pharmacies, convenience stores, gas stations, etc. and start building a database of names.

Also, some fo the brokers may actually let you do little mini-seminars in their offices for their agents.  Start calling the brokers and just ask.

Mar 9, 2010 11:10 am

Yeah that's what I'm thinking.  They are easily approachable, identifiable, and if qualified profitable and independent so the decision turnaround time is faster than a typical small business with an advisory board.

I'm hopefully meeting with my realtor/client this week to get his inside feedback as well, of course letting him know he'll be receiving all of my referrals.

Thanks again!

Mar 9, 2010 11:47 am

Yield Spread - Thank you for all the insight.  Were those workshops for homebuyers or professionals?  If you're marketing to REPs how do you combat that they might be working from home.  From what have you gotten the best response (Cold Calls, Cold-walking, Sales Meetings, Speaking Engagements, Letters, Postcards, Handwritten cards, Workshop/Seminar, Event, Association Conference/Tradeshow)?  Yes, if they had an advisor they would probably be a much more qualified prospect, so I'm not afraid of that.  I agree, I can see how they'd be difficult to work with.  I am hoping to screen out all of the "un"professionals as much as I can.  Even so I recognize they will have a lot if not the majority of their assets tied into personal real estate deals, that being said I still believe they could invest enough and give me enough business with the assets, financial planning, and insurance.  As a sideline I had never really seen the benefit of working together with a lender, them having insights into the investments was something I hadn't thought of. 

My response-Workshops we host are as a mortgage company directed to homebuyers.  We sponsor the event and never have a shortgage of agents interested in signing in.  We do thier prospecting for them.  If you know one realtor you can get it with the rest. 

I strongly would consider working with a few lenders.  When I am taking a loan app I see almost their entire financial snapshot.  I also get a chance to make a number of refferals.  I often refferal people to insurance agents for both p&c as well as life, I ask they like thier accountant, or inform them now that they will be itemizing it might be a good time to talk to Jim with XYZ, and more improtantly there investments. I have to know if they are getting income from thier investments to qualify them so taking a look is part of the business. 

Prior to deciding to stat my own RIA I was making refferals to a ML guy for sizable accounts and an RIA for stuff my ML family member didn't want.  Bottom line is its a good source.  I