In real estate, lead generation is key to keeping your business growing, your income flowing, and deals closing. You must continue filling the top of the funnel in your lead generation process to avoid dry months without pay. Continuous lead generation creates a constant flow of clients to work with that will, in turn, create predictable income.
Real estate pros have had little time to focus on proper lead generation for the past couple of years due to the white-hot real estate market. But now that the reins are pulling back, this is a perfect time to perfect your lead generation strategies.
We rounded up some valuable stats on lead generation that might give insight into what methods you should focus on, which methods are a waste of time, and some strategies that might give you a leg up on the competition in your farming areas.
General Real Estate Lead Stats
1. About 37% of marketers struggle the most with generating high-quality leads.
2. Real estate has an overall average conversion rate of 4.7%, but top performers convert up to 12.0%
3. Average performers in the real estate industry turned 3.2% of visitors into qualified leads.
4. More than 85% of leads will respond after six follow-up touches.
5. On average, a lead requires eight to 12 touches before being ready to transact.
6. Email advertising in real estate converts 1.4% of leads.
Takeaway: Many real estate agents feel their lead gen doesn’t live up to the hype. But more than likely, the real culprit is lousy follow-up. Focus on spending a lot of time nurturing leads you receive, no matter where they come from, to reap the greatest returns.
Real Estate Social Media & Video
7. Eighty-eighty percent of social users want more video content from brands they love.
8. Video ads have a 48% better sales rate than static ads.
9. Meta’s algorithm favors video ads that:
- You produced yourself
- Are not duplicate videos
- Keep users watching until the end
- Aren’t clickbait
10. Fifty-nine percent of millennials and 70% of Gen Z users watch Instagram stories regularly.
11. According to Wyzowl (via HubSpot), “92% of video marketers feel the levels of noise and competition have increased in the last year.”
12. Wyzowl’s 2021 State of Video Marketing Report reveals that 84% of respondents agree that using video helps with lead generation.
13. Seventy-four percent of REALTORS® use Facebook, and 56% use LinkedIn for professional purposes.
14. Twenty percent of all members get 1-5% of their business from social media, and 10% get 6-10%.
15. Sixty-four percent of real estate agents said they plan on getting more clients from social media, according to the Mid-2021 Real Estate Agent Survey from The Close.
16. In the HubSpot Blog’s 2022 Marketing Industry Trends Survey, we found that more than half of marketers (51%) who use short-form video plan to increase their investment in 2022. Meanwhile, 38% plan to continue investing the same amount.
17. Short-form video has the highest return on investment (ROI) of any social media marketing strategy.
18. According to the National Association of Realtors® (NAR), 52% of respondents said social media was the tech tool that provided the highest number of quality leads in the last 12 months.
Takeaway: For many agents, video is an uncomfortable subject. But the verdict is in—your future clients love video. And they want more of it. The competition has heated up over the past couple of years, spurred by the pandemic. If you’re not using video with your social media, now’s the time to get on board.
19. Sixty-eight percent of sellers who used a real estate agent found their agents through a referral by friends or family.
20. Fifty-three percent used the agent they previously worked with to buy or sell a home.
21. Thirty-nine percent of homebuyers used the same listing agent who sold their home to purchase a new home. This stat rises to 85% percent for sellers who purchased a new home within ten miles.
22. Two out of three people say they’d be more likely to purchase after watching a testimonial video demonstrating how a business, product, or service had helped someone else.
23. A referred customer has a 16% higher lifetime value than a non-referred customer.
24. Only 29% of satisfied customers refer others without asking.
25. Twenty-one percent of Realtors get over 50% of their business from referrals.
Takeaway: Referrals continue to reign supreme as agents’ #1 lead source. And they’re free, to boot. But the trick here is using a good customer relationship manager (CRM) to stay top of mind with those clients who already know, like, and trust you. If you keep in touch, they will continue generating business for years.
26. According to the National Association of Realtors® via Investopedia, only 3% of homebuyers visit open houses.
27. Roughly 2% of door-knocking leads convert to new clients.
28. Fifty percent of buyers now find their homes online.
Takeaway: As agents, we know that open houses don’t sell houses. But what they do, and still do well, is provide face-to-face interaction with people in your farming area. Sure, there may be a buyer or two who shows up unrepresented that you can make a connection with. But don’t be too pushy. Have a solid strategy for building relationships with everyone who comes to your open house. You never know when you’re talking to a future seller.
The Open House Checklist Top Agents Use for a Stress-free Day (PDF)
Paid Lead Generation
29. The average incubation rate for online real estate leads is six to 24 months.
30. The national average conversion rate for online real estate leads is usually reported to be from 2% to 3%. However, The National Association of Realtors® disclosed that the rate is actually closer to 0.4% to 1.2%.
31. According to a NAR survey, over the last 12 months, respondents spent less than $50 (29%) monthly on lead generation. Twenty-four percent of respondents spend between $50 and $250 monthly on lead generation.
32. The average cost per lead in real estate is $30 to $50.
Takeaway: Paid lead generation can be a great way to generate a constant flow of leads that pays for itself when you close those deals. The trick with paid leads is making sure to track your ROI. These stats show that conversion for online leads is tricky, so if you want to get the highest returns on your lead generation investment, you must get good at converting those leads.
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FSBOs & Expireds
33. Calling expired property listings typically has a conversion rate of 1% to 3%.
34. According to the National Association of Realtors®, only 3% of FSBO listings sell within the desired time—and a mere 18% reported receiving the right price.
Takeaway: So many agents are afraid to work with FSBO leads. But the conversion rate on FSBOs is higher than online leads, according to these stats. And it’s also a well-documented fact that a high percentage of FSBOs end up using a Realtor. So, it’s definitely worth your time and effort to work with FSBOs.
Expired listings can be another fertile source of listings. The trick is to reach out to older expired listings that haven’t been bombarded with tons of calls in the past 24 hours.
The 9 Best FSBO Scripts of 2022 (+ Why They Work)
Who Are Real Estate Leads?
35. According to the 2021 Profile of Home Buyers and Sellers, the typical homeseller has been in their home for eight years. The typical home size is 1,900 square feet. The typical homeowner is 45 years old.
36. Homebuyers who used the internet to search for a home increased to an all-time high of 97% in 2020.
37. Gen Xers and millennials are the largest generation buying homes today.
38. Eighty-one percent of all Americans own a smartphone, signaling that most advertising should be optimized for mobile to reach audiences effectively.
39. Nearly 50% of adults report that they use Facebook several times a day.
40. Ninety-five percent say that positive or negative reviews influence their purchasing decisions.
Takeaway: Your future clients are online. And they’re around 45 years old. Get in front of them where they are. And work on your testimonials! Get as many positive reviews as possible because, with all the noise out there, those reviews drive decisions with your future buyers and sellers.
We’re entering a shifting market where many agents have never been. Now is a great time to brush up on those communication skills and get back to basics when it comes to lead generation.
Of course, things are not the same as they were 20 years ago, and there are many more options available to agents and brokers than there once were. But some good old-fashioned face time, building relationships, and working your farm are solid places to start filling your funnel.
What farming methods and marketing strategies will you focus on in the coming months? We would love to hear some of them, along with some success stories. Share them in the comments below.