Real estate farming is a lead generation and marketing strategy used by real estate professionals to generate consistent business from a specific geographic area. Agents farm a specific neighborhood by providing consistent value and attention and cultivating relationships—thereby generating leads that evolve into long-term clients and reliable business.
Done successfully, real estate farmers capture at least 30% of all sales in a target area, making real estate farming a lucrative and dependable way to run a real estate business. In this article, we’ll walk you through our detailed farming strategy, outline the tools you’ll need to get started, and make suggestions for where you’ll find the best marketing materials to dominate your farm area.
Looking to go even deeper? We created the Ultimate Real Estate Farming Strategy Guide for those who want to dive in headfirst. Download the guide today for your comprehensive, proven resource for all things farming.
Real Estate Farming 101: Basic Strategy + Cost to Get Started
Ready to start real estate farming? Here are the four basic steps to this powerful strategy, plus the budget you’ll need to get started in your first year.
1. Target the Right Neighborhood
Essential tool: Your Local MLS
The success of your real estate farming operation depends on choosing the right area. A good farm included 500 homes or less (see our FAQ section for the “why”). Choose a place where there’s healthy demand (a good absorption rate) and where homes are being listed for sale at a solid clip (a good turnover rate). Ideally, choose a place where you’ve got some name recognition and some built-in expertise.
In our Ultimate Real Estate Farming Strategy Guide, we’ve got all the tools you’ll need to choose the right farm area. We’ll show you how to calculate absorption and turnover rates, and give you tips on conducting geographic, demographic, and property research.
2. Plan How & When to Deliver Value to Your Farm
Essential tool: Parkbench Neighborhood Website
Agents crushing the real estate farming game are delivering consistent value to homeowners in their farm areas. The key to this step is to plan the “what,” “when,” and “how” in advance. That way, you can reserve your precious face-time for client conversations that will move your prospects closer to a transaction.
Examples of successful real estate farming outreach include postcards, market updates, social media groups, and neighborhood websites. Create a calendar with each message you’re planning to send, and note what value it provides to your audience.
If you don’t know where to get started with the neighborhood website, we suggest Parkbench. With a Parkbench website, you can create an online space where community members can get information about local events, news, neighborhood happenings, and, of course, real estate—all brought to them by you, their go-to resource.
3. Make a Plan to Manage & Track Your Leads
Essential tool: Real Estate CRM like LionDesk
Your real estate farming leads are distinct from the types of leads you get from Zillow Premier Agent or the home valuation landing page on your website, so track them as such.
For our money, the best way to track leads is to invest in a solid real estate customer relationship manager (CRM) that will allow you to tag farm contacts, automate digital communication like email or text messages, and create a record of the value you’ve delivered over the life of your farm. Plus, a CRM provides an easy system to track every reply you send and ensure you promptly follow up on every point of contact.
Our choice for the best real estate CRM for 2022 is LionDesk, but you can check out all our top picks in our guide: The Best Real Estate CRM for 2022: In-depth Reviews & Pricing.
4. Execute Your Real Estate Farming Plan: Start Delivering Value!
You’ve chosen the right farm area, made a plan to deliver consistent, long-term value, and set up a system to help you manage and track your interactions. Now, it’s time to set your automated communication plans in motion and start the clock on the high-touch outreach you’ll do to follow up with your postcards, social posts, and market updates.
Successful real estate farming is a combination of long-term automated communication and smart, day-by-day, personal follow-up. If you treat farming as a set-it-and-forget-it strategy, you won’t be as effective. Be active in the communities you’re serving, and your clients (and your wallet!) will thank you!
Wait, What About Social Media for My Real Estate Farming?
Social media can be a powerful tool for real estate farming. Many local neighborhoods have their own Facebook groups and homeowners associations (HOAs) with dedicated websites and social profiles, not to mention residents who are likely to be active on social platforms. The Close Pro real estate coach Sean Moudry suggests a slightly different approach.
Start by connecting with members of your farm area using your personal social media profile. Then, using Facebook, create a custom audience for specific posts that include only the people in your farm.
Sean’s strategy can be a great tool for promoting your Parkbench website and any neighborhood-specific web content you’ve created, like market updates or neighborhood blogs.
Real Estate Farming: Cost to Get Started
You can expect upfront costs for effective real estate farming, but the returns will repay your investment many times over if you stick with it. Typical annual costs for a real estate farming operation with 250 homes would look like this:
Annual Real Estate Farm Cost: 250 Homes
|Regularly Scheduled Postcards (250 x 8 = 2,000)||$1,260|
|Property Status Update Postcards (200 / month x 12 months = 2,400)||$1,584|
|Regularly Scheduled Quarterly Letters (250 x 4 = 1,000)||$550|
|Door Hangers for Your Annual Door-knocking Session (250)||$100|
|Neighborhood Website (Try Parkbench)||$3,500|
|Farm-specific Content for Your Website||FREE|
|One Sponsored Event||$1,000|
While this is a sizable investment, don’t forget to look at the upside. If you’re farming a neighborhood where the typical home sells for $400,000, a single 3% commission is worth $12,000 in gross commission income (GCI).
A single property sale will likely recuperate all your investment, and then some. If you’re turning over three or four transactions a year from your real estate farm area, the positive return on investment (ROI) is clear.
Essential Real Estate Farming Tools You’ll Need
Real estate farming requires a high level of organization, a solid plan for execution, and, of course, the tools you’ll need to consistently deliver value to your farm area. While these tools could include anything that will get your message to your audience, here are the approaches we’ve found work best for real estate farming.
Regularly Scheduled Real Estate Postcards & Flyers
How Often to Deliver: Twice per quarter
Typical Annual Cost (250 homes): $1,260
Our Suggested Provider: LabCoat Agents
The Close Resource: Top 5 Real Estate Postcards Providers + Postcard Examples That Actually Work
Details: The backbone of your farming campaign is your real estate farming postcards and flyers. These are ideal tools to convey messages, statistics, and authority to your farm area.
Use them to deliver a quarterly snapshot of the market, recipes, or sports schedules—ANYTHING that will provide value to your recipients.
On-demand Postcards, Prompted by Market Activity
How Often to Deliver: Whenever a home is listed or sells in your farm area
Typical Annual Cost (250 homes): $1,584
The Close Resource: Circle Prospecting Case Study
Details: If your regularly scheduled postcards are a dependable, professional handshake, then on-demand postcards are your unexpected high-five.
Use this marketing tool to make homeowners aware of market activity in their community, especially after a property sells. Look for spikes in your home valuation landing pages traffic after these postcards go out.
Sending about 50 postcards to most similar homes in your farm area is a wake-up call to homeowners. You’ll be providing them with valuable information and insight into what their financial opportunity could be if they decide to sell, as well.
Farm-specific Content on Your Website
How Often to Deliver: At least monthly
Typical Annual Cost: Free (as long as you have a website)
Details: Your farm area should have a dedicated section on your website where you can post weekly updates about the micro-neighborhood market, goings-on in the neighborhood, and even events in and around town. Your content can be short and sweet, with five or six sentences and a picture.
Remember, your website serves two purposes: to act as an online hub for your neighborhood to stop by and see what’s going on, and to show potential buyers interested in purchasing in your chosen area that you’re the go-to expert when they are ready to buy.
Complete Market Update Letters
How Often to Deliver: Quarterly
Typical Annual Cost: $550
Our Suggested Provider: You!
The Close Resource: 17 Best Real Estate Prospecting Letter Templates
Details: The real estate letter is an ideal way to share market deep-dives since they provide more space for in-depth thought and analysis. Talk about what’s going on in your business or give shoutouts to those doing good works in your community.
Share messages that communicate to your farm that you’re the expert when it comes to buying and selling homes and LIVING in your community.
We’ve pulled together 17 real estate prospecting letter templates as a helpful resource for your prospecting venture. Check it out and start upping your prospecting game today.
📌 Pro Tip
Pro tip: Farming a high-end neighborhood? Consider handwriting those letters. Yes, it will be time-consuming, but the personal touch provided will pay off in spades with discerning sellers.
Parkbench Neighborhood Website
How Often to Deliver: New content one to two times a month
Typical Annual Cost: Starting at $3,500
Our Suggested Provider: Parkbench
The Close Resource: How Parkbench Helps Agents Drive Community Connections
Details: Collecting and communicating information that your farming community wants to know about is the best way to use a neighborhood-specific website. Try including interviews with local business owners, local news, coupons, and, of course, all the latest information about the real estate market.
Some people won’t visit your personal website because they perceive it to be about you, but a website focused on their neighborhood is about them, making it more palatable, and even appealing! As mentioned earlier, our suggestion for this sort of platform is Parkbench.
Power-users of Parkbench are posting weekly content (if not more often). However, posting once or twice a month is a great first effort for agents just getting started on the platform.
Door Hangers for Your Annual Door-knocking Session
How Often to Deliver: Once a year
Typical Annual Cost: $100
Our Suggested Provider: VistaPrint
The Close Resource: Door Knocking for Real Estate: Will It Still Work? (+ Tips & Scripts)
Details: Your farming efforts will be significantly more effective if you’re intentional about getting face-to-face with the people in your farm. Door-knocking isn’t everyone’s cup of tea, but remember, you’re not going into these walks around the neighborhood cold.
By the time you kick off your door-knocking weekend, neighborhood residents will have heard from you multiple times. They know you, even though they don’t know you yet, and they should be familiar with the value you’ve provided so far.
Door-knocking takes practice, a little bit of courage, and most of all, consistent effort. Don’t call it quits until you get through your entire farm. We promise that the last 50 doors you knock on will be a lot easier than the first 50.
Materials for Your Annual Sponsored Event
How Often to Deliver: Once a year
Typical Annual Cost: $1,000
Our Suggested Provider: You!
The Close Resource: 10 Unique Client Appreciation Event Ideas: Lead Gen With Cocktails?
Details: Whether you’re throwing a summer block party and BBQ or a Halloween party, events are a fun way to meet and greet community members.
Start with something you know will be a hit if you’re new to event sponsorship—like a free pumpkin giveaway in October. Or, try sponsoring a neighborhood garage sale, a community fireworks display in July, or a Christmas tree giveaway in December.
Real Estate Farming FAQs
Why should my real estate farm be 500 homes or less?
When it comes to real estate farming, bigger is not always better. In fact, it rarely is. Real estate farming is an effective marketing strategy because you target a specific set of homes with a message that adds particular value. The bigger the selection of homes, the less likely you are to deliver messages that appeal to all homeowners in your farm area.
Keep your farm small so you can focus your message and deliver more value.
How much of my real estate farming message should be about the local real estate market?
Market conditions and specific statistics can be powerful conversation starters in your real estate farm. However, these types of messages can get boring pretty quickly for anyone who’s not actively ready to buy or sell. So, we suggest using the same rule you’d use for social media marketing: Make 30% of your message about the market and the rest about the community.
What kind of results should I expect from my real estate farm?
Successful real estate farms yield around 30% of the transactions from a particular area. Of course, every market is different. Your success depends on area-specific information, including the types of homes in the market, the sort of agent competition you’re facing in your particular farm, and how long you’ve been active in the area.
The successful farming agents we’ve spoken to say they consistently capture between 20 and 30% of the transactions in their area annually.
How long does it take for a real estate farm to produce results?
Real estate farming is not an overnight success strategy. Though you may see some exciting immediate returns on your efforts, the leads you capture in the first three months from your farm are likely to be people who were ready to pull the trigger on buying or selling anyway. True farming success takes time. Give yourself a year with this strategy before measuring your results.
Are there real estate farming companies that will execute my strategy for me?
Through our research, we’ve only found one reputable company specializing in farm strategy execution—a company called Geographic Farming. We don’t have direct experience with this firm, but their website demonstrates a good handle on the real estate farming approach.
Bringing It All Together
Real estate farming is an effective means of prospecting and developing a consistent source of seller and buyer leads. The best part about farming is that your rate of return on your investment improves over time—as your messaging gets sharper, as more people recognize you, and as your sales stats in the neighborhood improve.
Have a real estate farming idea we didn’t cover? Let us know in the comments!