The Top Real Estate Performance Metric
New Real Estate Agent Tracking for Success
As a new real estate agent, you need to know the importance of tracking. As salespeople, our minds can play tricks on what we think we are accomplishing in our prospecting and lead generation time. But, what performance metrics should we be tracking as a new real estate agent? And how do we know if we are being successful?
In this article, video, and podcast, you will learn the most important real estate agent performance metric to track. We also refer to these metrics as KPIs (key performance indicators). They are called key performance indicators because they are leading signs that we will be successful.
A Personal Story
I always knew the importance of tracking and knowing your performance metrics in real estate, however, on busy days, I would simply miss that day of tracking. On the missed days, I would fill in my numbers based on “what I thought”.
The problem is, as humans, we are notoriously poor at knowing our numbers without tracking.
This was made obvious to me when I hired a personal trainer for a few months. I felt like I was in good shape but just wanted a boost. Before my sessions started, the trainer simply said that I need to record everything that I ate for 1 week. Follow this, he would put together a meal plan for me.
I told him this wasn’t necessary because I ate well. Tracking the number of calories I consumed seem like a waste of time because I knew I was in the target range.
I grudgingly went along.
After two days, I was blown away. I was consuming almost twice as much as he was budgeting me for.
He quickly came back to this term of key performance indicators and performance metrics. He said “no matter how hard you work, you will not reach your goals with these numbers”
That was me “filling in the gaps” when it came to performance metrics and it changed the way I looked at tracking, forever.
The One Simple Performance Metric To Track as a New Real Estate Agent
You’re now on board with the importance of tracking but what is the metric? It is daily conversations. GCI, to closings, open houses to the transaction, cost per lead, lifetime value of a customer, etc are all important but as a new real estate agent, the most important thing is the number of conversations you have in a day.
Real estate is a people based business but we can get trapped behind our computers all day working on our Facebook ads, websites, content, and social media profiles, but the one KPI that will lead to says is conversations. It’s not that everything else isn’t important, it’s just daily conversations is the most important.
There is a simple correlation between the number of conversations you have on a daily basis and your production.
Increase your conversations, you increase your production.
How Many Conversations Do I Need to Have?
We recommend a minimum of 10 each day. That is a minimum, so if you are looking to grow your production, you can push up to 20-30 per day. However, once you break above 30, chances are you risk burn out.
With your daily conversations, it’s not just about having the conversations, it’s about tracking it.
You may be thinking that you easily talk to 20+ people every day, so you can just skip this step. Well, be careful with that thinking. When I first started tracking my conversations, I was quite a bit lower than I had anticipated.
What Counts as a Conversation?
The next question that comes up is what exactly is a conversation? Does it count if I say “hi” to someone in the store?
There is some freedom here when it comes to what you want to classify as a conversation in real estate, however, we do have some general rules.
The conversation needs to beyond, “Hi, how are you?” This is just the tip of the iceberg. A conversation is when you and your counterpart actually have a back and forth beyond the “how are you” and “nice weather”.
It can’t always be layups. You should call your mother every day but counting this as a call is pushing it.
It doesn’t need to be hard. Yes, you everyday calls to your mother or best friend shouldn’t count, but I conversation with a colleague in the office counts. A chat with the cashier at the store counts. A conversation with an old friend counts.
It doesn’t need to be about real estate. The conversation doesn’t need to be about the market and if they have any referrals for you. It’s a simple chat. Most times your counterpart will ask what is new with you and that is where you jump into real estate!
As far as the method of communication, feel free to make these in-person, phone, text, messenger, or direct message. These are all ways that you can have a back and forth conversation. You will notice that we do not include email. That is because email is too passive and easy for someone to neglect. It should be an actual back and forth conversation.
As a new real estate agent, if you want to increase your production, all you need to do is increase the number of people you speak with. This seems simple (and it is simple), but it might not be easy.
If you think you are already having plenty of conversations each day, track it for a week and honestly look at the number of conversations you are having.
If you are unhappy with your production, you can simply increase your conversations and your production will follow.
[00:00:00] Hello and welcome to Rev Real Estate School. The show with quick tips and actionable advice to help you sell more real estate in today's world. And now your host Michael Montgomery.
[00:00:11] Hello and welcome back to Rev Real Estate School. My name is Michael Montgomery and today we are talking about tracking and not tracking as a whole tracking as a whole is extremely important. .
[00:00:22] Today we are talking about tracking one thing one thing that is crucial for new real estate agents growing real estate agents and experienced real estate agents for that matter.
[00:00:34] Today we are talking about one thing that you should definitely be tracking in order to increase your production in real estate so it can be hard to track. I totally get it. There's so many things that we're supposed to be tracking and that can be you know of course your GCI is your main one. But appointments closings open houses to a transaction cost per lead lifetime value of a customer. It can go on and on and on. But the importance of tracking can not be overstated. It is extremely important. The reason why is because what you track will change because you can not know exactly what you're doing without tracking and it seems so obvious. And the other thing is a lot of times we don't even think that it's necessary because we know OK you know I do X number of open houses and then I typically get an appointment and you know most appointments that I go on I end up leading to a listing or a buyer or something. But without tracking something you can not know that for sure. You can not definitively say that. And oftentimes we are wrong.
[00:01:37] Our minds can play tricks on us and think that we're doing more than we're actually doing. Let me tell you a personal story about this and it comes down to fitness. So when I got my personal trainer he had me track everything that I ate and I told him it wasn't necessary I said you know what Dan it's totally fine. I eat well I take care of myself. That's not the issue I just want to get myself on a good fitness schedule with you. He said fine just humor me and track what you eat for a week. And I told him I would. And when I tracked what I ate I was eating probably twice as much as he had wanted me to and not the right things where in my mind I was like "Yeah I'm just a healthy eater I just eat what's healthy".
[00:02:22] But when I tracked it it was shocking how far off I actually was compared to where I thought I was. So tracking is very important.
[00:02:32] So let's talk about that one thing that you should be tracking. One of the most important things in real estate is talking to people. So the one thing that you should be tracking is your conversations that you're having with people. More conversations equals more deals. This is one of the simplest things that you can track. And it's called a KPI. So a key performance indicator that we track in order to lead to production.
[00:02:59] So if we want to have more deals we increase the number of people that we talk to and this can be in any way whatsoever. This can be face to face. This can be on the phone. This can be out in public. This can be privately over text. This can be a Facebook messages can be a D.M. whatever it might be.
[00:03:16] It is a conversation it is to people or more going back and forth and talking. It is the simplest way to increase your production increase conversations.
[00:03:27] So how many should you be having at a minimum. Shoot for 10 conversations a day. If you think that's easy then just like my trainer did humor me and track it and let me know track it and see how many conversations you are having on a daily basis shoot for a minimum an absolute bare minimum of 10 but if you want to increase your production then push this up to 20 to 30.
[00:03:54] But don't go up there all the way to say like you could go up to say 40 50 getting into that range but you could end up facing burnout. So I find when you start to get up above the 20 into the 30s and start to get into that realm it does start to get pretty challenging. If you think that you already do that awesome track it and let me know because I'd be very very interested and what classifies as a conversation.
[00:04:18] I mean if I pass somebody in the street and I say" Hey how you doing" does that qualify you do? That to me is not a conversation. So the way that we teach it is you have to have a conversation that goes beyond hello how are you and how's the weather. So just just beyond that it doesn't have to be too much farther beyond that. I mean if you're grabbing a coffee or something like that you're talking to somebody at the table and you start bringing up the weather or something like that but then it goes one step further and you start commenting on their shoes or something like that. You talk about your kids or something along those lines or whatever it ends up going to doesn't really matter. But as long as it goes beyond just a casual hello how are you. And turns into a back and forth conversation that counts.
[00:05:01] We also say that text messages count but the thing about text messages is it has to be reciprocated so you blasting off a bunch of text messages and not getting any response this does not qualify. You do need to be in a conversation over text but in this day and age that does count as well.
[00:05:18] So if you want to increase your production is so simple just increase the number of people that you're talking to. But first start by tracking that number of people that you talk to shoot for an absolute bare bare minimum of 10 and don't go a day without speaking to 10 people unless it's a rest day and you're not at the office and you're not working. But if you do want to increase production then crank it up and shoot for 20 to 30 conversations a day and do it consistently do not end up missing a day and saying that you're going to do you're going to make it up the next day. I've tried to do that and let me tell you it is such a challenge. If you're trying to have 20 conversations and you fall short one day that's fine but then trying to make it up the next day feels almost unbearable. It is a lot if you're if you're shooting for 20 and that was a challenge and you maybe only have five one day for one reason or another and then the next day you have to have your 20 conversations plus 15.
[00:06:12] . It's just it just becomes so challenging. So really try and stay consistent with this because this is where you will actually start to see the results is when you combine consistency with the right actions. As always thank you so much for tuning into this episode and we will catch you on the next lesson.
[00:06:31] This episode of Rev Real Estate School has come to a close. Thank you for tuning in. We'll see you back here for the next lesson.
Follow Up Reading:
Question: What is one metric that you track in your real estate business? Let me know in the comments below.