The first quarter of the year is traditionally the slowest in the real estate industry. But you can use the time to assess and plan for success in the busy months ahead. It’s also a time to hit markets that are not your primary target during the majority of the year, such as rental properties. So, while the quarter is ‘slow’ in terms of sales, there are plenty of things you can do to drive a future boost in business.
Hit Rental Market Investors
January is the time to reach out to clients and potential clients interested in investments in rental property. While the real estate market as a whole sees a slowdown in the cooler months, rental property investment maintains a relatively high Effective Gross Yield (EGY).
In areas subject to seasonal fluctuations due to the weather, it’s the time for investors to buy low and rent high. The Midwest, for example, is a prime spot for late winter rental property investments.
The type of client to target in January for rental property investment is the individual (and not the corporation). According to HouseCanary, publicly traded institutions own less than 1% of the 18 million rental properties in the United States. Individuals who own just one rental property account for 50% of the industry. You can use the slow time during Q1 to reach out to past clients who can be first time rental property investors. These clients are the ones who have mentioned wanting to invest in the future, have seen their current real estate purchase increase in value, or who have inquired about investing in rental properties in the past.
Know Where the Spec Homes Are
The last housing boom in the United States saw a flood of speculative (“spec”) homes in the market. These are houses that commence construction before they have a buyer. Now, with the low inventory and uptick in the economy, spec homes are back. Find out who these builders are now, so when your buyers come to you in the spring. you’ll have a leg up on showing these homes. Because of the harsh winter, some areas of the country might not see new construction until the spring — prepare anyway. Talk to the builders now to know where and what they plan to build. (It’s never too early to start talking about how you can help them market their properties with your great marketing plans.)
If you’re considering increasing your product offerings or furthering your education (or have necessary CE courses to complete this year), now is the time to take the classes. The NAR (NAR) is a reliable first stop when beginning a course offerings search. You can also check with your local real estate licensees association for the courses, certifications, and designations they offer.
Building (or Rebuilding) Your Team
If you’re a business owner, now is the time to evaluate your team, schedule training, and ascertain what changes you can make now so you’re ready for the busy spring season. For some, this may mean offsite meetings or events geared toward education and team-building. For others, this may mean one-on-one discussions about potential, goals, and areas of improvement.
Review Your Marketing and Advertising Strategy
Now is also the time to look at your budget and plan for marketing during the year. Questions to ask are:
- Which markets do you want to advertise to?
- What is your message for each market?
- How and where will you convey that message?
- Do you need to hire a marketing agency, consultant, or freelance help?
Review Your Insurance Coverage and New Areas of Business
If you’re an individual agent, the safest way to ensure continuous E&O protection is with your own E&O policy. Learn more about why you need individual E&O.
If you’re anticipating adding additional services like mortgage brokering this year, you may need a Surety Bond.
If you’re creating your team, you’ll need Real Estate Errors and Omissions insurance for your company — to protect yourself and your business. You may also need a Business Owner’s Policy and Worker’s Comp insurance.
The risk of not having adequate E&O insurance is high—if you are faced with a claim, you could lose your reputation and your business. CRES E&O + ClaimPrevent® helps your business prevent claims with included Legal Advisory Services 7 days a week. You’ll also enjoy access to Building Permit History Reports, Cyber Liability Coverage, Seller’s E&O Protection Plans, and Qualified Home Warranties. Contact CRES Insurance to discover how much more coverage you can — and should have — to protect your business.
Whenever you are in doubt about any transaction, procedure, or change to documentation, contact CRES ClaimPrevent® Legal Hotline to discuss your questions or concerns.
How do you tackle the slow quarters? What do you think is the most beneficial use of your time when sales are slow? Tell us in the comments below!