How Do Real Estate Agents Generate Leads?

 

How Do Real Estate Agents Generate Leads?

In A Nutshell:


Real estate agents use various methods to generate leads, each with its own advantages and disadvantages. Essential lead generation strategies include:

✅ Online Ads
✅ Sphere of Influence (SOI)
✅ Buying Leads
✅ Open Houses

 
 

Diverse Strategies for Real Estate Lead Generation

Your success in real estate depends on how well you can find new clients.

You have many ways to do this:

  1. Google ads

  2. Facebook campaigns

  3. Buy leads

  4. Host open houses

  5. Talk to people you know

Each way has good and bad points.

The best choice depends on what you want, what you can spend, and who you're trying to reach.

Insights from Barry Jenkins

Barry Jenkins, our Realtor in Residence at Ylopo, shares his thoughts:

"Buying leads online is a fantastic way to scale your business. You're paying to talk to folks interested in what you offer."

But here's the thing - the cost for each lead can change.

It all depends on how clear the buyer is about what they want.

Finding the Right Balance in Paid Lead Generation

Some services offer special leads - buyers ready to buy a house in 30 days.

But these can cost a lot.

You might have to pay 42% of what you earn. That's a big chunk!

On the other hand, you can get cheaper leads.

These might be people who click on house listings on Facebook.

They need more help to decide, and fewer of them end up buying.

But they cost less to find.

Barry's team chooses the second option.

They:

  1. Buy cheaper leads

  2. Spend time teaching people about buying houses

  3. Do this through talks, meetings, and agreements

"For us, that's where we landed," Barry explains. "Ultimately, you've got to do what's right for you."

Open Houses: Are They Really Free?

Open houses are another way to find new clients.

You don't pay money upfront, but they take a lot of time and work.

Barry says it clearly: "It's a lot of work to generate the leads. It's a lot of work to cultivate them."

To make open houses work well:

  1. Have a good plan to get visitor information

  2. Keep in touch with these people over time

  3. Offer prizes or gifts to encourage people to share their contact details

But be careful - it can be hard to turn open house visitors into clients.

Many already have an agent or aren't really looking to buy.

Building Relationships for the Long Run

Talking to people you know - past clients, friends, community events - can be cheap.

But it takes a lot of work to build relationships and meet people face-to-face.

Barry notes, "Client events are probably the cheapest, but they're the most demanding. Face-to-face interactions, planning events, dinners - it all adds up."

If you're great at building relationships and giving excellent service, you'll see good results.

You can get a steady flow of recommendations and repeat business.

Technology and Personal Touch

As real estate changes, using technology and personal service together will help you stand out.

What's coming next?

  1. Marketing that uses data to find the right people

  2. Computer programs that help nurture leads

  3. Virtual tours of houses

Marketing with data will help you find promising leads based on:

  • Who they are

  • What they do online

  • What kind of house they like

Computer programs will help you send the right information to people at the right time.

This makes it more likely they'll become clients.

Virtual tours are becoming more popular.

They'll get better and more common.

This technology lets you show houses to more people, even those who live far away.

It gives a real-life feel that can help qualify leads and speed up buying.

Focusing on One Area to Find Clients

Focusing on specific types of real estate can be great for finding high-quality leads.

You can become an expert in areas like:

  1. Luxury homes

  2. Waterfront properties

  3. City apartments

By focusing on one area, you become the go-to person for buyers and sellers in that group.

Specializing lets you tailor your:

  1. Marketing efforts

  2. Networking events

  3. Content creation

For example, if you specialize in luxury homes, you might work with high-end:

  • Interior designers

  • Landscapers

  • Home technology providers

These partnerships could lead to special events for wealthy clients.

If you become known as an expert in your area, you'll attract leads more likely to buy and earn you more money.

International Buyers: A Growing Group of Clients

Another special group with potential? International buyers.

The National Association of Realtors says foreign buyers bought $74 billion worth of U.S. houses in 2021.

The top five countries were:

  1. Canada

  2. Mexico

  3. China

  4. India

  5. United Kingdom

To work with this group:

  1. Build relationships with international investors

  2. Partner with overseas real estate agencies

  3. Understand what foreign buyers need

This might involve:

  • Learning about cultural differences

  • Understanding tax rules

  • Knowing visa requirements

  • Creating marketing materials in different languages

  • Providing extra-special services

If you help international clients understand the buying process, you'll stand out from other agents.

Measuring and Improving How You Find Clients

No matter which ways you use to find clients, it's important to track and analyze your results.

This helps you get better over time. Here's how:

  1. Set clear goals

  2. Define what success looks like

  3. Use tools to monitor how well each method works

Important things to track:

  • Cost for each lead

  • How many leads become clients

  • Return on investment for each way you find leads

  • Average time from finding a lead to closing a sale

  • How much a client is worth over time

Look at these numbers regularly. Make decisions based on data. Improve your methods. Use your resources more effectively. Grow your business.

Putting It All Together

Finding new clients is crucial for success in real estate.

There are many ways to do this.

As Barry Jenkins says, the best approach depends on your goals, resources, and who you're trying to reach.

Understand the good and bad points of each method.

Use technology and personal service.

Focus on special markets.

Always measure and improve your efforts.

If you do this, you'll develop a strong way to find new clients.

The result? Long-term growth and profit in your real estate business.

Remember, there's no one perfect solution for everyone.

Try different things.

Find what works for you.

Stay flexible.

The real estate market always changes. Your ways of finding clients should change too.

 

  • Of course, lead gen in this business goes into many different tangents and directions.

    Let's explore some more cool ways to get more clients.

    We'll look at tried-and-true methods and new ideas that'll help you shine in this busy field.

    Digging Deeper into Client Acquisition

    Finding clients in real estate isn't a one-size-fits-all thing.

    You need to mix different ways to find people who might want to buy or sell homes.

    The business is always changing, so you need to stay alert.

    Knowing what's new is super important if you want to do well.

    Current Trends Influencing Client Attraction

    As we move into 2025, here are some big trends shaping how agents connect with clients:

    1. Video Marketing: People really like watching videos. They're fun and full of info. You could make virtual tours so buyers can see homes from their couch. Or create videos about the market to show off what you know.

    2. Social Media Engagement: Facebook and Instagram are great for connecting with your community. Share stories about happy clients or what they say about you. This builds trust and shows people what you can do.

    3. Open Houses as Networking Spots: Hosting open houses, even for other agents' listings, can really help. You'll meet potential buyers who don't have an agent yet. Plus, you'll get to know more people in the business.

    Proven Approaches to Attracting Clients

    1. Use Your Existing Network

    The people you already know are a goldmine for potential business.

    Keep in touch often.

    Send out newsletters, personal messages, or updates about the market.

    A quick "Happy Holidays" or "Check out this new trend" can keep you in their thoughts.

    2. Build a Referral Network

    Friends, family, local businesses - they can all send valuable clients your way.

    Go to community events.

    Join local groups.

    Team up with businesses for joint promotions.

    Everyone wins when you boost each other's visibility.

    3. Content Marketing through Blogging

    Got knowledge to share? Write it down!

    Blog about market trends, tips for buying homes, or cool things in your community.

    This will bring people to your website and make you look like an expert.

    A post like "5 Things First-Time Homebuyers Need to Know" could be just what someone needs to reach out to you.

    4. Invest in Targeted Advertising

    Websites like Zillow, Trulia, and Realtor.com let you show ads to people actively looking for homes.

    Make your ads fit specific groups for better results.

    Maybe focus on first-time buyers in one area and fancy home seekers in another.

    5. Open Houses: Two Birds, One Stone

    Open houses aren't just for showing homes.

    They're great chances to meet potential buyers.

    Host events for other agents too.

    You might meet some clients who don't have an agent yet.

    Make your open houses fun with themes or snacks to stand out.

    Data-Driven Insights for Effective Client Acquisition

    Numbers tell the truth. Let's look at some stats that show how different methods work:

    • Social Media Marketing: Social media marketing remains a critical tool for client acquisition, particularly through platforms like Facebook, Instagram, and LinkedIn. The success rate of social media marketing for lead generation ranges between 55% to 70%, depending on the platform and industry. The average cost per lead (CPL) is around $21 to $30, with varying effectiveness based on the quality of content and targeting strategies​.

    • Email Campaigns: Email marketing is highly cost-effective, boasting an average ROI of $42 for every $1 spent. The success rate is around 50%, with an average CPL of $15 per lead. The effectiveness of email campaigns is largely dependent on personalization and targeted messaging​.

    • Open Houses: Open houses are effective for real estate lead generation, though they typically have a lower conversion rate of about 2.4%. The average CPL for open houses is approximately $30, reflecting the investment in promoting and hosting these events​.

    • Paid Online Advertising: Paid online advertising, such as Google Ads, is a significant driver of real estate leads, with an average CPL of $66.02 and a conversion rate of around 2.47%. The cost per click (CPC) for real estate ads averages $2.10, making it a competitive but potentially rewarding strategy​.

    • Networking Events: Networking events are particularly effective for generating high-quality leads, with conversion rates ranging from 4% to 10%. The CPL for leads from networking events typically ranges from $25 to $50, making it a cost-effective strategy for building personal connections and securing long-term clients​.

    Best Practices for Client Acquisition Success

    Want to make your efforts work better? Keep these tips in mind:

    1. Stay Consistent: Keep engaging regularly. Don't disappear on your audience!

    2. Follow Up Fast: Quick responses to leads can make a big difference.

    3. Analyze Your Results: Use tools to see what's working and what's not. Then make changes as needed.

    Advanced Techniques for Maximizing Client Attraction

    Ready to step up your game? Try these advanced strategies:

    1. Use CRM Systems

    Customer Relationship Management (CRM) systems can make managing leads much easier.

    They help you:

    • Keep track of conversations

    • Set reminders for follow-ups

    • Look at client data

    2. Host Webinars and Workshops

    Share what you know!

    Offer free online talks or workshops about buying homes or market trends.

    This makes you look like an expert and attracts potential clients who want to learn more.

    3. Get Involved in Your Community

    Support local events or volunteer for community activities.

    This helps more people see and know you.

    It's also a great way to get natural referrals and new leads.

    Pros and Cons of Various Client Attraction Strategies

    Every method has good and not-so-good points. Let's break it down:

    1. Social Media Marketing

      • Pros: Reaches lots of people, is cheap, and gets people talking

      • Cons: Needs constant new content and takes time

    2. Email Campaigns

      • Pros: Talk directly to people, are easy to measure, and cheap

      • Cons: Can look like spam and need a good list of emails

    3. Open Houses

      • Pros: Let you meet buyers face-to-face and get instant feedback

      • Cons: Take a lot of time and might not attract serious buyers

    4. Paid Advertising

      • Pros: Reaches specific groups, gives quick results, and can grow

      • Cons: Can be expensive and needs ongoing money

    5. Networking Events

      • Pros: Build relationships and can get referrals

      • Cons: Take time and need good people skills

    Key Takeaways for Effective Client Acquisition

    Remember these points as you make your plan:

    1. Mix It Up: Use different methods to reach more people

    2. Quality Over Quantity: Focus on building good relationships with leads

    3. Stay Informed: Keep up with what's new in real estate and change your approach

    4. Measure Your Success: Regularly check how your efforts are doing

    5. Be Genuine: Real interactions build trust and lead to long-term relationships

    Advanced Techniques for Lead Generation

    Let's explore some cutting-edge ways to supercharge your lead generation:

    1. Email Marketing Campaigns

      • Pros: High return, personal communication, easy tracking

      • Cons: Can look like spam if not done right

    2. Search Engine Optimization

      • Pros: Cheap long-term strategy, builds trust

      • Cons: Needs ongoing work and know-how

    3. Virtual Tours and Open Houses

      • Pros: Makes homes more accessible, saves time

      • Cons: Needs investment in tech, might lack personal touch

    4. Referral Programs

      • Pros: Encourages word-of-mouth marketing, builds trust

      • Cons: Might need money rewards that affect your profits

    Key Metrics to Track for Lead Generation Success

    To see how well your strategies are working, keep an eye on these important numbers:

    1. Lead Conversion Rate: Shows how many leads become clients

    2. Cost Per Lead: Tells you how much it costs to get each lead

    3. Lead Source Performance: Tracks which sources bring in the most leads

    4. Engagement Rate: Measures how much people interact with your content

    Making Informed Decisions

    Good lead generation in real estate mixes old and new ways.

    Understanding different techniques, tracking important numbers, and always improving your approach can really boost your ability to attract and convert leads.

    As you try these strategies, stay flexible and ready to change with the market. Real estate is always changing, and those who use new technologies and methods will do the best.

    Final Thoughts

    Whether you're new to the game or have been around for years, getting leads takes an active and varied approach.

    Use the strategies we've talked about, but don't be afraid to try new ideas.

    Find what works best for you and go for it.

    Remember, the real estate market never stays the same. Your ways of finding clients should change too. Stay curious, stay flexible, and watch your client list grow!

  • BARRY:

    "So there's Google ads, Facebook ads, order leads, open houses, and sphere.

    And with sphere, there could be subcategories there.

    There could be, you know, client events.

    There could be booths at, you know, Brial shows.

    There could be past client outreach, all that, all that stuff, you know, and all of them have benefits.

    All of them have drawbacks, right?

    So probably the cheapest would be client events, but it also is the most demanding with regards to face-to-face interactions, planning events, dinners, things like that.

    So none of them are necessarily bad.

    What I would really challenge everybody to do is to ask themselves a question is what's right for you, right?

    Obviously a lead, buying leads online is a fantastic way to scale your business because you're literally paying money to talk to people that are interested in the service you provide.

    And then how much you pay per lead depends on how much clarity you want the consumer to have, right?

    So there's some services that they wait to send you the lead until the lead says, I want to buy in the next 30 days.

    And then the service sends you the lead and they want a 42% referral fee, right?

    Now you might say, well, I don't really care because I got somebody that's ready to go look at houses this weekend.

    OK, that's a personal decision.

    That's totally fine with you, right?

    Or there's the opposite end of the extreme.

    There's somebody that saw a pretty house on Facebook, clicked it and said, I'm going to put my information because I want to look at more of the photos, right?

    And then you call them and they're like, I don't really know what I want, right?

    Well, I built my business off of that scenario of essentially buying leads much cheaper instead of paying, you know, if it's a $10,000 commission, instead of paying $4,200 for the lead that's ready now, I'm paying $15 for the lead that doesn't know what they want yet.

    And that was right for my organization, because my organization is really big on teaching the consumer, bringing them in, having, you know, first time homebuyer seminars, homebuying seminars, the buyer consult, go over agency agreements.

    So for us, that's kind of where we landed.

    Ultimately, you've got to do what's right for you.

    I would just say that if you do buy a service that is costly, like a 42% referral fee, I would tell you that it's kind of like something you do for a little while.

    And then you've got a master climbing up the funnel to make more money.

    Probably under that, you know, another one we do really big is just open houses, you know, to be able to sit there, have people come to the house and talk to you about the home and have a really great strategy to keep those people that walked in the home on your website searching at other homes is also a really great strategy.

    I mean, the pros are it's free.

    The con is it's a lot of work.

    It's a lot of work to generate the leads.

    It's a lot of work to cultivate them because we call them leads.

    But, you know, if you set up a table, first of all, it's not free.

    You're going to have to pay for the table, but it's not a lot.

    Let's say it's $500 and you have a raffle, right?

    And let's say you get 100 people and you had a Yeti cooler.

    I don't know what they cost. Let's say that's 500.

    So now you spent a thousand dollars and you had 100 people submit their information to to get that Yeti cooler.

    And maybe you had a box you thought ahead and you're like, are you interested in buying and selling?

    And out of the 100, maybe five said, yeah, I'm interested in buying or selling one day. Well, now you've got 100 people.

    That's $10 per person.

    Right. And now you got to send information to all 100.

    You got to try to see if you can strike up a conversation.

    The five that said they're interested in buying or selling one day.

    Now you got to figure out, like, can I talk to them about that?

    You call them. It was great meeting you. Sorry, you didn't win the Yeti cooler.

    But I am hoping that I can talk to you about real estate one day.

    And they're like, oh, my friend's an agent.

    You know, so you have you're basically collecting a lot of people's information, but you're really struggling to actually sell houses because people don't wake up and suddenly say, I think I'm going to buy a house tomorrow.

    You know, it's something that takes a long time.

    So that's why focusing on the house and having people come to the house, you know, at least that there's interest in that type of property and that price range.

    You're farther along in your journey, but it's still really hard because if you've held an open house, you know, most people are just like, oh, I'm not interested.

    I have an agent.

    My cousin's an agent, something.

    And so you have a lot of hurdles that you have to overcome.

    So definitely pros.

    Like, it's great if you want to do free lead, Jen, but the cons for me, it just made it to where it wasn't worth it for me.

    I really enjoyed talking to people that were interested in the service that I provide.

    And then I can I can sell myself.

    I can teach them, which is a passion of mine and empower them.

    But I would say high level.

    Those are probably the pros and cons that come to mind for me."

Barry Jenkins

Realtor, Speaker, Coach, Trainer, Author, and Head Realtor in Residence at Ylopo