How to tighten your belt and cut unneeded expenses

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The practice of real estate is expensive right out of the gate. First you must take classes to get licensed, then pay to take the test to get licensed, then pay to get the license, then pay to have the license.

Now you have the license and you have to join your local board and the National Association of Realtors (NAR), the state or local board fees, the MLS fees, business cards — and the list goes on and on.

Then, you go to that conference and there are all of those people up on stage who are selling 500 houses every year. They were just like you a year ago, struggling, working too much, no time for fun, but now they are making $5 million a week and only working five hours a month.

You want what they have. You can have it too, and it’s only going to cost you $1,000 a month.

I have been practicing real estate for 20 years, and in that time, I have made every mistake there is to make, from team building to spending too much money. In the past two years, I had an epiphany and realized how much money I was bleeding without even thinking about it.

Let me take you on my journey and share some solid advice from agents around the country who have a lot of wisdom to offer.

A wake-up call

Let me take you back to Thanksgiving weekend 2016, when my friends — Charles and Sofie Langhorne, of The Langhorne Group with Compass — and I were working on our business plans for 2017. Charles is financially savvy — he does not waste money, and he thinks things through before he takes action. This has served their family and team well.

We were writing down our expenses and income, with goals for the next year. Truthfully, even though I had been in coaching for seven years and owned my own brokerage, I had never done this.

When I was finished, I stared at the paper and could not believe the number I was looking at. The amount of money I needed to make each month before I could even eat was astounding. I had no idea.

In that moment, my life changed forever. I wrote down all of the toys I was paying for and found that I was only using three out of 10 of them. I pulled my credit cards so that they could not charge me automatically when my year was up. (They do that, so be careful). Thanks to Charles and Sofie Langhorne, I learned at the tender age of 56 that it is not about how much you make, but rather about how much you keep.

I now run into old bills or receipts from the “dark days” and I shake my head at all of the money I wasted on things I never used.

Are you being wasteful?

How many people pay for leads that they never call? My Zillow rep told me that the number of agents who never followed up on the leads they paid for was unbelievable. That is one reason Zillow went to the concierge model. They wanted to make sure that their consumer clients got the service that they asked for when they inquired about property.

How many people buy marketing tools that they never use? How many people splurge on the latest and greatest tech, so advanced they don’t even have time to learn what it’s fully capable of?

Do you keep bouncing from shiny new object to shiny new object? Going to every conference that lands in your inbox? Then you come home and you do nothing?

I spoke with Brandon Doyle of The Brandon Doyle Real Estate Team in Maple Grove, Minnesota. Doyle is not only a Realtor, but he has also written two books: The Real Estate Marketing Playbook and Mindset Method Metrics, which you can find on Amazon.

Doyle uses a very simple yet brilliant test before he buys anything.

“A litmus test is what I do” he explained. “I determine if the tool is going to make me money, save me time or enhance my client’s experience. If it does not provide one of those three values, I cut it.”

Doyle went on to tell me that going deeper, he has found that most agents do not track their numbers, and they keep buying products they are not using. Here is the formula for tracking expenses that Doyle suggests:

• Monthly: Scrutinize profit and loss, and see what is generating business.
• Quarterly: Look deeper, and cut out anything that has not given you 2x-3x return on your investment.
• Yearly: Consider making bigger changes according to your budget, goals and time constraints.

How to generate leads for free

The best practice for making the most money and spending the least amount of capital is keeping track of how many leads you already have that you don’t call. Why pay to generate more?

Last year, my coach forced me to do nothing for a long period of time, except set appointments with people who were already in my database. I initially wanted to fire him, but he was right: Eventually, I found that I suddenly had eight deals in escrow. I resurrected old leads, got some referrals from past clients and reconnected with some paid leads I had never followed up on.

Yes, it works.

If you need more ideas for free lead generation, try these:

• Open houses
• Events
• Networking
• Lunches
• Coffee
• People you know
• Social media

Follow up. Be consistent to be successful. Have a plan for your day and your week. Execute, execute. I have found that if I make a list of what I am going to accomplish before I can go home, I am very productive and consistent.

I can do it in two hours or 10, but I must do it. I can even leverage it and have other people do some of it — as long as it is cost effective.

Remember: Go ahead and spend money on the next best greatest, most expensive thing, or fabulous coaching, best CRM or expensive fancy marketing — but nothing is going to make you successful if you don’t use it.

Doyle said something that I believe is the most important consideration of all: Does is enhance the client experience?

If you are not enhancing the client experience and providing content and quality that brings value to your clients, it’s a waste of time, money and resources.

On the cheap tools worth looking into

Check out these things that are free or very low cost:

Kingston Lane
Marketing website with a a lot of free and very low-cost tools, ideas and plans.

Sisu.co
Track and measure multiple dimensions of your real estate business.

First.io
Organize and manage your contacts, get recommendations on connecting with potential opportunities and get reminders of next steps with potential leads.

Loom
Free video email and web conferencing.

Ecamm Live
Streaming platform for Mac.