On Thursday, November 16th, Tessa Jelten and Ramon Casaus hosted a BAM webinar and described how agents can become more profitable and find more deals. 

They also shared lead generation strategies and expert insights from industry leaders. But here, we’ll focus on those five takeaways you can apply today to level up your profitability as a real estate agent. 

Which of these will you jump on this week?

5 Things You Can Do Today to Become More Profitable

#1—Raise Your Price Point

In other words, sell more expensive homes. The higher the price point, the higher your commissions. So, market, prospect, and spend more time around people with more expensive homes. 

Get familiar with what they value most in a real estate agent, and apply that to your business. 

As long as you have a system for managing your commissions income, you’ll have more breathing room between transactions—meaning less desperation for new deals. 

This doesn’t mean you can never help clients with less expensive properties. But make it a priority to do what you can on a daily basis to attract more clients at higher price points. 

#2—Audit Your COGS

Your COGS—the costs of goods sold—are the costs you incur with one specific translation. Your fixed expenses are your monthly cost of doing business as a real estate agent. Knowing both is critical to the success of your real estate business. But it’s not enough. 

Because what might seem right now to be a reasonable amount to spend each month or to spend per transaction could actually be more than you need to spend. And those numbers will make a real difference in the profitability of your real estate business. 

Enter the expense audit, where you review all the places your money is going for each transaction, as well as what you’re spending each month to keep your business running. It starts with awareness—but it doesn’t stop there. 

Start with your COGS. Looking at a typical transaction, what are you spending on— 

  • Vendors
  • Photos/video
  • Property marketing
  • Splits (value)
  • Transaction fees
  • TC management fees 

Look for areas where it makes sense to renegotiate or find a better value. If you haven’t done this before (or even if you have), there’s a good chance at least one of the above COGS is a good candidate for renegotiation—or an upgrade. 

Then do the same for your fixed expenses. 

#3—Print Out Your Previous Month’s Transaction Details

Print out (yes print) your last month’s transaction detail report/bank statement. 

There are 3 types of expenses you have:

  • 100% necessary to the function of the business
  • Nice to have but not make-or-break
  • Don’t actually need

If you cannot draw an expense-to-revenue correlation, drop it. 

Do this every month. 

#4—Leverage Your Preferred Vendors

When you’re planning expenses for marketing, lead generation, and client events, look at the businesses you’re partnering with for your mortgage lending, home inspections, title, insurance, moving services, etcetera. 

Is there room to share costs with one of your business partners who are also benefiting from these activities? Make a list and contact those who would benefit most from your planned investments in marketing, lead generation, and lead nurturing. 

Anticipate these partners’ questions by identifying exactly how they could (or, better yet, would) benefit from sharing the investment. 

#5—Add a Processing Fee

If providing a premium service, add an additional transaction processing fee of $300-700 per file, paid at closing for buyers and sellers.

If that premium service directly contributed to a successful outcome for your client, and if the expenses you’re incurring by going above and beyond for your clients exceed what the agreed-upon commission rate could reasonably cover, this fee should absorb the difference. 

You’re already giving your client visible evidence that you’re worth every penny of your commission—and then some. In any other industry, premium services cost extra. 

As long as you’re bringing so much value your clients feel they’re getting a bargain, they have no reason to object to a three-figure transaction fee. They’re paying for results. 

And you’re delivering.  

Sign up for BAMx to watch the replay, as well as to take advantage of our growing library of online courses, attend livestreams, and join the best Facebook group for real estate agents.