With mortgage rates and inventory at record lows, the housing market remains scorching hot. Hot markets are a seller’s dream, and many brokers, loan officers, and agents love this season as much as home sellers do.
But just beneath the surface of all those shiny “sold” announcements lurk hidden, industry-wide downsides: Ineffective marketing. Wasted budgets and time. Agent burnout. Stiff competition.
Because we are obsessed with solving problems, we took a closer look at five hidden downsides of the hot housing market, and how a collaborative marketing platform can help.
1. Hot markets keep agents hopping, with little time to master digital marketing.
According to the 2021 NAR Member Profile Report, many online tools are essential to realtors: 69% of realtors have a professional website, and realtors chiefly network through social media platforms like Facebook, LinkedIn, and Instagram.
In addition, agents want to harness the power of digital marketing to drive their business, but they already have full-time jobs. Let’s be real, in this market, they have more than full-time jobs.
Under-resourced agents miss valuable opportunities to generate leads and revenue with effective marketing programs that promote listings and sales and drive real business results; worse, they’re likely to waste time, budget, and resources on ineffective attempts. Agents simply do not have the time to reinvent the marketing wheel every day, much less maintain and upgrade that constantly-changing/evolving wheel each time Facebook or Google make a change to their platforms or roll out a new feature.
A collaborative marketing platform empowers agents, loan officers, and brokers to create polished marketing programs that drive real business results. Case in point:
One of our partners found that their thousands of agents were spending an average of 9 hours a week on digital marketing. After they implemented Evocalize’s technology on their agent portal, that number decreased to 5 minutes a week, with a 400% increase in the results of their marketing efforts.
The right tools can give your agents, loan officers, and brokers back a full work day every week that can be spent on closing business, and put their businesses in front of the perfect audience quickly, efficiently, and most importantly, productively.
2. Low inventory means tough competition for seller leads.
NAR’s 2021 Member Profile Report found that “lack of inventory” was the top challenge keeping buyers out of the market, topping even affordability and “finding the right property.” Seller leads are the holy grail of a hot market, the elusive keys to the kingdom.
Agents often attract sellers by promoting recent sales, a task that sounds simple, but is not.
We know just how easy it is to do digital marketing badly; inconsistent or untimely messaging or a clunky user experience are part of the learning curve. But in this market, where seller leads are competitive and worth their weight in gold, agents do not have the time or margin for error to learn on the job.
A collaborative marketing platform like Evocalize empowers agents to drive seller leads with the click of a button. Automated programs launch each time a new home is sold, and can capture leads within the ad creative to increase lead submissions and then send them to a CRM for automated follow up.
3. The wave of pandemic refinancing has come and gone, which means tough competition for loan officers and mortgage brokers.
A November 3 Mortgage Bankers Association survey found that even though mortgage rates fell for the first time since August, loan applications decreased 4 percent from the previous week, and 33 percent from the same week last year. At the same time, purchase activity is held back by high prices and low inventory, impacting origination activity.
Even rock-bottom mortgage rates couldn’t bump refinance applications. Re-fis, the bread and butter of the mortgage world during the pandemic, fell again for the sixth straight week, to their lowest level since January 2020.
Yet according to National Mortgage News, “The majority of mortgage lenders plan to expand or hold current staff levels in 2021, even in the face of declining origination activity, two recent reports found.”
In such a market, capturing leads and nurturing existing relationships with digital marketing is paramount to success, for both immediate business and cultivating future business. A lead that converts today means business today, future referrals from the happy customer, and likely future business when they buy a new home. And a lead that doesn’t convert today is still a relationship to grow for when they choose to refinance in the future or choose to buy a new home. Evocalize’s technology can be the competitive edge for brokers and loan officers who need the results of sophisticated digital marketing without needing to spend hours to get those results.
4. Agent recruiting and retention, always tough, can be a hot market flash point.
(Do not make a hot market burnout pun. Do not make a hot market burnout pun.)
Happy agents make happy agencies, but hot markets can push scores of agents into burnout in an industry that already culls rookies at new-restaurant rates.
A NAR report showed that 87% of new agents fail within the first five years, and 88% of NAR members surveyed identified themselves as independent contractors at their agencies. Put another way: agencies are made up of agents, and most agents fail. And that is hard on both the agent and the agency.
But this high failure rate doesn’t have to be the case. Equipping and empowering agents with the right tech and tools makes it easy for them to generate new business while focusing their time on mission critical tasks. Properly equipped, agents become more successful and avoid burnout. This in turn accrues to the agency, driving revenue and decreasing time spent on agent recruitment.
Agent recruitment can be another challenge. Offering tools and technology that make agents’ lives easier, gives them time back, and drives real business results is a compelling reason for an agent to join your agency.
To use the old fishing analogy - to recruit and retain quality agents, agencies can both give them a fish and teach them to fish more effectively. Now think of Evocalize as a next-gen fish finder that not only pings when you spot your desired catch, but automatically learns the best place to drop the line, and can even cast for you.
With the right tools, agencies grow and retain seasoned agents, increase brand recognition, improve recruitment, and ultimately increase revenue.
5. With business booming today, setting up future success slips through the cracks.
Hot markets do not last forever. In fact, Realtor.com’s September national housing report found that while the market remains strong, with homes spending an average of 11 days on the market and listing prices still on the rise, the price growth rate is slowing. September 2021 saw more price reductions than the same month last year.
In Aesop’s fable, the grasshopper sang all summer while the ant put away stores for the hard season to come. The right marketing tools equip agents to be both ants and grasshoppers, maximizing the market’s summer while preparing for the cooler season ahead.
After all, a well-managed lead can grow an abundant relationship with multiple conversions for both agents and loan officers; buyers eventually sell, sellers need a new home to move to and a new mortgage to go with it, and buyers and sellers have friends that become referrals.
This housing market contains some significant challenges that hover below the radar while business is hot. We see these challenges as a tremendous opportunity to inoculate your business against industry-wide obstacles. We’re helping a number of players in real estate, mortgage, and other verticals make hay while the sun is shining, and simultaneously future-proof their businesses.
Of course, we hope none of these hidden downsides have impacted your business, but if they have, we’d love to talk about how we can help you drive more business through effective digital marketing.