SAN FRANCISCO--(BUSINESS WIRE)--How are real estate agents around the country serving their client base while building their referral business? The second annual study from ReferralExchange, the leading referral network for real estate agents in the U.S., shows that referrals are important for their monetary value and are also a vital part of maintaining contact and service with past and current clients.
The study queried 1,800 agents around the country to determine how agents are maximizing the power of referrals to fuel their business growth. A referral is defined as someone who is ready to act compared to a lead which is generally unqualified. The agent-to-agent referral economy has grown along with the real estate market. This year’s survey showed that there was a small increase in the median number of referrals received by agents up to 8.5% from 6% in 2016.
The agent-to-agent referral economy relies on both the submitting and receiving of referrals. Of the agents surveyed over 60% said they receive more than five referrals per year. Most of the agents, 59%, sent out less than five referrals. Referrals can represent significant income: as many as 5% of agents survey earned $50,000-$100,000 on these fees last year while 2% earned up to $500,000.
The study showed that 83% of the agents surveyed belong to a referral network and nearly 36% of these agents stated that more than 20% of their overall inbound referrals are attributed to these networks. The majority of agents who are in a referral network don’t purchase as many leads as those who are not members of a network.
More than 37% of all agents reported that over 20% of the referrals they received or sent ended in a closed deal. This represents a significant difference from real estate leads. Of the agents surveyed most said that they either didn’t know how many leads they had closed or that the leads closed were less than 5%.
“Referrals are one of the key drivers of business in the real estate industry. If an agent can’t assist a client in buying or selling, a solid referral is crucial. Experienced agents rely on referral networks to provide additional resources for the clients they work with,” said Scott Olsen, ReferralExchange CEO.
ReferralExchange saw 71% growth in agent matches in 2017, creating over 215,000 referral connections around the United States. The vast majority of agents in the network have more than 14 years experience, more than $5 million in sales, and have had 20 real estate transactions in the last 12 months. In 2017, the company helped connect over 215,000 agents and clients together. “Reputation is everything in real estate,” adds Lisa Fettner, VP of Marketing for Referral Exchange, “The agents and brokers we work with trust that their clients will be matched with an experienced agent with local expertise and a commitment to customer care.”
The full results of the survey are available as a downloadable white paper at https://www.referralexchange.com/referral-report
ReferralExchange, the nation’s top agent-to-agent real estate referral company, is dedicated to creating great real estate experiences between real estate professionals and customers. Founded in 2005, ReferralExchange has built an invite-only, nationwide network of over 24,000 top-performing real estate agents. In 2017, the network helped generate over $3.75 billion in sales.