Is Your Real Estate Niche Wrong? [Quiz Inside]
If you are anything like most successful business owners, you already understand that focusing on a niche is the fastest, easiest, and most powerful way of generating real estate leads. You also know, it is the best way to give yourself a fighting chance to avoid becoming one of these statistics:
Agents with a real estate niche, earn an average of $35,000 more than agents without one.
3% of real estate agents make more than $35,000 per year.
Approximately 90% of new real estate agents fail within the first three years.
Those numbers are more than enough to give even the most aggressive agent pause for a moment. This is exactly why I have spent so much time creating content for you over the years to show you why you need a niche.
However, my main concern today is that you may have chosen the wrong real estate niche!
As I have been flooded with more coaching calls and requests in the last few months and I have been working with people on their copies of The Intentional Real Estate Agent, I’ve discovered a staggering number of agents that have the wrong niche.
I’m sure you’re wondering “What makes a real estate niche ‘wrong’ for someone?”.
Believe it or not, there are actually several factors that determine if a niche is right or wrong for you and we are going to review them today. That difference can have a major financial, emotional, mental, physical health. In fact, you might even be relatively happy with your real estate niche right now, even though it is wrong for you...which will cost you later.
So, how do you know if you have the wrong real estate niche?
How do you fix it if you have the wrong real estate niche?
How much can you expect to make with your new real estate niche?
I’m going to answer all of those questions and more in this special edition of The Best Real Estate Writer blog which includes excerpts from the Ideal Client chapter of my latest book The Intentional Real Estate Agent Guided Journal. So, if you enjoy today’s article, I know you will devour that entire book and thank me for how it transforms your career.
Why Did You Choose Your Real Estate Niche?
The first indication that could clue you in to the fact that your niche is wrong for you is the method you used to choose that niche. Here are some of the most common ways a real estate agent chooses their niche:
Picked from a random list of niches
Their mentor had the same niche
Their broker or team leader chose the niche
Their current/past client base tended to be one niche or another
Someone else told them it was a money-maker
These are not the right way to choose your niche if you want to reach your happiness and earning potential.
To better highlight the impact that having the incorrect real estate niche can have on you as a real estate agent, I am going to share a story of a client I have worked with to assess her niche and help her choose one that was better fitted for. Note: I have changed her name to protect her privacy.
Mary Goes Back To School...
Mary got her real estate license in Southern California after retiring from teaching. She is convinced to pursue luxury real estate because she wants the highest possible commissions for the fewest number of deals per year and thinks that is the way to do it. She discovers that the cost of marketing luxury properties is not only much higher but the clients treat her like an employee which is a huge disappointment for Mary because she was excited to be her own boss. Every time a deal falls through Mary is crushed and financially stressed but when they work, they bring her relief she can hang on to keep working for the next deal.
After listening to Mary for a bit and asking some key questions, I realized that Mary wasn’t in the right niche because it was causing her additional financial stress, brought down her morale because of the way clients treated her, and ultimately she was only closing about two deals per year as a result. I switched Mary to begin working with move-up homebuyers working in education and the transformation was swift. Soon, Mary found herself with more referrals from past connections in the education space, facing less objections, closing more deals that moved smoothly through escrow, and generally enjoying her job as a real estate agent more. Plus, she got to rely on her biggest strengths of patience and education by teaching people how to navigate the process of buying and selling simultaneously for the first time.
In short, you need to answer this question about your real estate niche as it pertains about the present and the future:
Do you enjoy working with that group of people so much that you wish you could serve that sector every single day until the day you die and even then you would wish to live just one more day to work with the people of that niche?
If not, you have the wrong real estate niche.
How Do You Feel About Your Real Estate Niche?
If you answered “no” to the question above, but you still feel like you enjoy your niche, you have to ask yourself why you like it so much. Is it just that it happens to be making you money right now?
Remember, every day that you are in the wrong real estate niche you lose out on working with more of your dream clients, you limit your true earning potential, and you create a deeper sense of brand confusion in your marketplace.
The other issue happens when someone answers “yes” to that tough question, but is in a real estate niche that has a low ceiling for income. For example, if you love working with first-time buyers in your market but most spend an average of $100,000 on a home and you only to manage to pick up ten new clients a year, you will bring in around $30,000.
You really have to have a hard and truthful look at both sides of the real estate niche coin to ensure that you are setting yourself up to achieve the goals you set for your real estate career.
Choosing A New Longterm Real Estate Niche
If you are still with me at this point, it is probably because you are realizing you may have chosen the wrong real estate niche for yourself. The good news is, you’re here now correcting the problem for good.
As promised, I am now going to share an excerpt from The Intentional Real Estate Agent Guided Journal to help you get back on the right track with your niche.
One of the biggest reasons that I chose to be a real estate copywriter (rather than any other industry) is that I wanted to help as many agents as possible realize that they can have complete power in this business. In other words, you have the right as a real estate business owner to work with people that you actually enjoy working with.
When I am coaching my clients to help them find their real estate niche, I always encourage them to start by thinking about themselves first. That is why we have already taken the time to examine yourself on a conscious level. I hope that as you were going through the previous prompts, you thought about things like your personality, the people you surround yourself with in your personal life, and your personal preferences.
For example, if you are easy-going and prefer to be around people that are also easy-going it would not make any sense for you to target the luxury market because those clients are typically very high-maintenance and demanding.
Or let’s say you were a teacher in your past career and know you have a lot of patience. You would be well-paired with first-time homebuyers because they need a lot of handholding and respond best to patient agents that enjoy teaching them throughout the process.
Now, if you are not a brand new agent but early in your career and have yet to choose a true niche, this next piece of advice is especially important!
Forget The Past
The biggest mistake that most real estate agents make when choosing their real estate niche is to look back at the people that have hired them in the past.
Remember, this is about choosing who you want to work with, not who chose to hire you in the past.
It is very important that you are critically careful when you design your ideal client or real estate niche that you are only thinking about the people that you would kill to work with, not anyone else.
The only time that it is okay to look at your past clients is if they are in alignment with your new niche because that will help you get into their mindset and identify the pain points you will need to address to attract more people like that.
Go With Your Gut
For some people, narrowing your ideal client down so much can be very challenging because they are so agreeable that they enjoy working with everyone. Often in these cases, I encourage people to go with their gut to narrow it down.
Let’s pretend for a minute that you MUST choose between three different people to marry. Let’s also assume that you know and enjoy spending time with all of them. However, you are being forced to choose just one of them to spend the rest of your life with. Wouldn’t you go with your gut feeling about who will offer the best possible future?
If you are someone that knows how to listen to their gut and trust themselves, I encourage you to do so in this portion of your journal.
Ask Yourself Why (Again)
Before you decide definitively on your niche, I want to urge you to ask yourself why you are choosing that person or demographic as your ideal client.
Often in real estate, agents will choose a niche purely because someone else told them it would be profitable or because they think it will be the easiest way to make money.
Let me tell you right now that if money is the sole motivator for why you have chosen your niche you will end up being far less successful than if you select your niche based on passion and compatibility.
Think about it, if three years from now you can’t stand the majority of your client base, you will be far less motivated to lead gen, follow-up, and deliver the best possible customer service. On the other hand, if you are in love with the majority of your clients you will leap out of bed each day energized and excited to go be the best you can be at your job. That passion will be what leads to the biggest profits.
Profitable Real Estate Niches
Again, I want to reinforce the fact that you shouldn’t choose your niche purely because you think it will make you rich because if you get in it and hate the people, your motivation and productivity will tank and you will probably wind up making far less. However, here are some of the niches that my clients have chosen to generate real estate leads on demand through strategic marketing and branding:
Farm & land
Military & veterans
REO’s, Short sales, foreclosures
Still Not Sure If Your Real Estate Niche Is Right For You?
Great news! I developed this short quiz to give you even better insights as to whether or not you need to choose a new niche. At the end, you will also get a personalized recommendation of where to go from here, depending on your results.