As a real estate agent, you’re constantly juggling a million different tasks while trying to keep track of everything that’s happening in the market.
Add in your yearly goals to grow your business, and things quickly become overwhelming. Many agents get into the habit of trying new strategies each week, hoping that one will eventually stick and be successful. While it is important to be flexible and open to trying new things, it’s essential to first know exactly what is working and what isn’t.
The best way to know what’s working in your business is by looking at the numbers. That’s right; we’re talking about data analysis. But don’t worry—this isn’t as scary as it sounds. By analyzing a few key data points on a weekly basis, you can get a better handle on your real estate business and make data-driven decisions to help you succeed.
In this article, we’ll explore common data points that every real estate agent should analyze. Plus, how to interpret and use this data to drive your business forward.
Benefits of Data Analysis
Using data to drive business decisions allows you to make informed, objective decisions rather than relying on gut instincts or personal biases.
Data helps you identify trends and patterns that you may not have noticed otherwise—allowing you to adapt or change course when needed. Additionally, it gives you a starting point when setting benchmarks and goals and allows you to easily track your progress toward achieving them.
By using data to guide your decision-making process, you can make more effective, efficient, and profitable business decisions.
Common Data Points for Real Estate Agents to Analyze
Real estate agents should analyze a variety of data on a regular basis to stay informed about the market and make informed business decisions. Here are data points to analyze on a regular basis.
1. Market Trends
Real estate agents should make a habit of analyzing market data on a daily basis. This doesn’t have to take long—spending 10-15 minutes to review MLS hot sheets is enough to give you insight into what’s happening in your market. By doing this every day, you’ll have an in-depth understanding of what’s selling (and not selling).
Some specific market data that real estate agents may want to analyze include:
- Sales volume: The total number of properties sold within a specific time period. Analyzing sales volume can help you identify trends or changes in housing demand.
- Sales price: Reviewing sales prices gives you insight into different price points. Compare the sales price to the listing price to determine how many properties are selling at or above the asking price.
- Price changes: Review how many properties drop their listing price in your market.
- Days on market: The number of days that a property is listed for sale before it is sold can provide valuable insights into the competitiveness of the market—especially as the market is shifting.
- New listings: Review all new listings coming to the market, and be ready to reach out to potential buyers who may be interested in a property.
Reviewing the data above can help you determine trends and shifts taking place in your market. You will also want to analyze:
- Housing supply and demand: Understanding the balance between the supply of properties on the market and the demand for them can help you set pricing strategies for sellers and identify potential areas of opportunity for buyers and investors.
- Economic indicators: Economic indicators such as employment rates, GDP growth, and consumer confidence can have a significant impact on the real estate market. Stay up to date on the overall health of the economy, and be prepared to explain to clients how this affects the local market.
- Demographic trends: You also need to be aware of demographic trends in your market, such as population growth or changes in the age or income of the population. These trends can affect housing demand, as well as what types of properties will sell quickly.
By regularly analyzing these and other market trends, real estate agents can gain a deep understanding of their market. But it’s not enough to simply be an expert. You also need to make the data relatable for consumers and share what you know—whether through social media, marketing, or in conversations.
2. Lead Generation and Conversion Rates
As an agent, you must track lead generation and conversion rates to understand where you are finding—and converting—the most clients. This is important whether you are a solo agent or a part of a team because it enables you to understand where your strengths are. Take time at least once a month to analyze your leads and conversions.
Here are some specific steps that real estate professionals can take to analyze lead generation and conversion rates:
- Set up a system for tracking leads: You need to have a system in place for tracking and organizing leads. If you are just starting out or don’t have a big budget for lead gen, this could be as simple as a spreadsheet. Eventually, you’ll want to use a specialized customer relationship management (CRM) platform.
- Track lead sources: In your CRM, you can make note of where each lead came from, whether a referral, online marketing efforts, or open houses. This will help you understand which lead sources are most effective.
- Monitor lead conversion rates: How many leads become clients? Often, leads get lost when there’s no follow up. Regularly track the percentage of leads that are converted into actual sales, so you see at which point they signed on with you as an agent.
Once you have collected data on lead sources and conversion rates, you can analyze it to identify trends and patterns. For example, you may notice that leads generated through social media have a higher conversion rate than those received from Zillow. Having this information allows you to make the best decisions when deciding how much time (and money) to allot to each lead source.
3. Marketing and Social Media Performance
You spend time creating content and marketing materials—but do you actually know the effectiveness of these efforts? You don’t need to spend hours on this task, as content created for brand awareness can be difficult to measure.
However, you should be aware of how your content is performing. Delegate this task to a marketing manager or virtual assistant, if possible, and have them track it weekly or monthly.
- Set specific goals and benchmarks: Start by identifying specific goals for marketing and social media efforts, such as increasing website traffic or generating leads.
- Use analytics tools: From there, you can use analytics tools to track results. You can use tools within each social media platform (like Insights on Instagram) or opt for an all-in-one reporting platform like Sprout Social or Hootsuite. These tools provide data on engagement rates and conversion rates.
- A/B test: A/B testing involves creating two versions of a marketing or social media campaign and comparing their performance. This can be done with email marketing, on YouTube, and paid ads on social media platforms. This helps you determine what content resonates most with your audience.
4. Website Traffic and Engagement
There are several tools and strategies that real estate agents can use to track website traffic and engagement. Again, this can be delegated to someone on your team.
Some specific options for website traffic include:
- Google Analytics: Use Google Analytics is a free tool that allows users to track a variety of website metrics, including traffic, engagement, and conversion rates. Use this tool to understand how visitors are interacting with your website and identify areas for improvement.
- Google Search Console: Google Search Console is another free tool—this one helps you monitor your website’s performance in Google Search results.
- Landing page analytics: If you are using landing pages as part of your marketing efforts (like a free home evaluation page), you should also be tracking the performance of these pages. You can use Google Analytics or specialized landing page software to do this.
By tracking engagement online, you can gain valuable insights into the performance of your website and identify areas for improvement.
5. Client Satisfaction and Referrals
Every agent dreams of a business where clients are calling them. With enough years of exceptional service, word will get around that you are the right agent to call in your market. But along the way, you’ll want to ensure your clients are fully satisfied when working with you.
Here are some ways to analyze client satisfaction:
- Client feedback: After working with a home buyer or seller, ask for verbal or written feedback from clients about their experience. This can be done informally, such as through casual conversation or through more structured channels like email or online reviews.
- Retention rates: Track retention rates by calculating the percentage of clients who return to you for future real estate needs. Considering this is usually years down the road, it’s critical to stay top of mind with consistent follow up.
- Referral rates: Referrals are often the best indicator of a satisfied client. Track how many referrals you receive each year, and be sure to show your appreciation for everyone who sends you business.
Every couple of months, look at the data you collected for client satisfaction and referrals. If needed, it’s better to course-correct mid-way through the year than wait until the end of the year.
6. Time Management and Productivity
With everything you have to get done, time management is critical. Determine what strategies work for you, and hold yourself accountable for being productive during working hours.
Some options for time management analysis include:
- Time tracking and management tools: There are a variety of time tracking and management tools that allow users to track how they are spending their time. You can use a simple tool like the Pomodoro timer, convert to block scheduling in your calendar, or opt for a tool that eliminates distractions when working on your computer, like StayFocused.
- Productivity metrics: Take a look at how many income-producing activities you complete each week. This can include: the number of conversations you had, the number of appointments you went on, and how many listings you got signed.
- Time logs: You can also do a simple exercise to audit how you spend your time. Log how you are spending your time every day for a week to identify areas for improvement.
Tracking your time management should be quick and easy—don’t use this as an excuse to put off income-producing activities.
Ongoing Value of Data Analysis
Whether you collect the data yourself or delegate it to someone else, it’s important that you take the time to identify trends and patterns. Depending on what type of data you are looking at, you may create charts or graphs to show what is happening over time. Then, look to find patterns—places where you are strongest and areas where you can improve. After all, it’s no use collecting all this data if you’re not going to use it to further your business.
You can use the baseline data to set benchmarks and goals for your business. Knowing what you did last year is a great starting point to set SMART goals for this year. Then, you are able to clearly know when you’ve reached a goal—because it’s all in the numbers.
Regularly collecting and analyzing data is an essential aspect of moving your business forward. By using data to identify trends and patterns, set goals, and inform marketing strategies, you can make informed decisions rather than guessing what to do next. A data-driven approach gives you the ability to continuously improve and adapt your business in an ever-changing market.