4 weeks ago
9
Vetted by HousingWire | Our editors independently review the products we recommend. When you buy through our links, we may earn a commission.
Real estate referrals are the lifeblood of most top producers’ businesses. This is evident when you ask any highly successful agent where they find their clients. Inevitably, their answer will be “my past clients and sphere.” That’s wonderful and something to be admired, yet I’ve had many agents who are earlier in their careers ask me HOW these agents built this referral machine.
In this article, you’ll find nine tried-and-true ways to start and grow your real estate referral business. We’ll first cover what a referral referral is and how they can benefit your business. Let’s get started!
- What is a real estate referral?
- What are the benefits of referrals?
- 9 savvy strategies to get more real estate referrals
- The bottom line
A referral estate referral occurs when a licensed agent or broker passes along a prospective buyer or seller to another licensed agent to handle a transaction. The receiving agent becomes the buyer or seller’s primary point of contact and representative, and the referring agent receives a referral fee if a transaction closes.
Sometimes, a real estate agent may choose not to work with a specific buyer or seller. Perhaps the client wishes to make a purchase that isn’t in the agent’s geographical area or their wheelhouse of expertise. Instead of giving up the business, the referring agent introduces the potential client to another real estate agent who is better positioned to help them.
Typically, once the referring agent introduces the client to the receiving agent, they will no longer participate in the transaction. Their work is done, and it’s up to the receiving agent to serve the client and close the deal.
Real estate referrals and referral fees encourage cooperation amongst an interactive network of agents and brokers. Developing a trusted referral network can generate new business for you (and your network). On the client side, referrals ensure that each client is appropriately matched with an agent or broker with the right expertise (and licensure).
9 savvy strategies to get more real estate referrals
A note on mindset. Asking for referrals can be intimidating for some agents and it can feel sales-y. Yet the truth is you’re simply asking to be connected with people who could use your help. We’re never trying to convince people to move. As real estate professionals, we’re here to step in when there’s an existing real estate need.
Keep this in mind as you ask for referrals, and you’ll bring a more humble and gracious energy to your conversations.
1. Ask directly for referrals (from everyone!)
Ask for referrals from everyone you interact with: current clients, past clients, friends, family, people you meet when you’re out networking, your geographic farm, neighbors, colleagues at another job (if you’re dual career or have a side gig), vendor partners and anyone else you have a business conversation with.
I know you’re probably thinking that’s a lot, and you would never do that. But the more you ask directly for referrals, the more real estate business you’ll have. That’s another important truth to keep in mind each day.
Written referral requests
You can also include a call-to-action in an email or text message to your most recent buyers and sellers. Choose your moment! When a buyer has closed escrow, they’re pretty excited about taking possession of their new home. It’s a good time to text them or email them with a request for referrals.
You can also ask for real estate referral business on a cute postcard you send to your sphere of influence or your farm, something like “Please think of me when your friends or family members want to buy or sell real estate!”
We love Wise Pelican for full-color, two-sided postcards and other print marketing materials designed specifically for real estate agents. Think: Just Listed postcards, Just Sold postcards, door hangers and more.
In-person referral requests
When possible, ask for referrals in person because your tone of voice and body language communicate so much. Asking over the phone is second best—you lose the body language aspect but your tone helps you to communicate more fully.
Survey referral requests
Another great way to ask your clients for referrals is to send out a survey after the transaction is over, assuming it was a positive experience. A survey serves a few purposes. It allows you to collect valuable feedback to potentially improve your customer service, gives you a chance to ask for a referral, and also lets you collect a testimonial you can use on your website.
2. Ask for referrals from fellow real estate agents
BONUS
Many other industry professionals aren’t allowed to give referrals to each other and collect fees, so we are fortunate this is an option for us in real estate!
Other agents can be an incredible source of referral business. They’re already interacting with potential buyers and sellers all day, just like you are. I always recommend staying in touch regularly with your agent referral partners, in the same way that you stay connected to your database of potential buyers and sellers. That way, when they have a referral to send you, you’re the only agent they think of.
The most common referrals are from out-of-town agents. Maybe you’re reading this in California, and you have a client moving to Massachusetts. You could call me, and my team would work with your buyer to help them find their dream home, sending you a nice referral check after closing.
Agent referrals can come from within your market area, too. I’ve even received referrals from agents in my own office. There are a lot of possible reasons why an agent might refer business to another local agent: maybe they’re too busy, maybe they are stepping away from working with clients at a lower price point, perhaps they will be on an extended vacation or they don’t specialize in the particular type of transaction. Perhaps an unrepresented buyer came to their listing’s open house and the agent doesn’t want to do dual agency. Sometimes, it’s just not a good agent-client personality fit. Building strong relationships with your fellow local agents is important for many reasons, and receiving referrals is one of them.
The best way to generate real estate referrals through social media is to consistently ask for referrals in a variety of specific scenarios. For example, post a success story about a recent sale you had and end the story with a call-to-action: “If you know anyone in a similar situation who needs some help, please reach out and let’s chat!”
The key is to be specific in your story. Talk about the widow who had wanted to move out of her colonial-style house for years and finally did once her husband passed away; now, she’s in a single-level condo and doesn’t have to carry her cat up and down the stairs anymore. The more detail, the better. Just be sure to keep it anonymous to protect your client.
Another way to use social media to generate referrals is to run a contest and promote it on your social channels. Double check with your broker on your state’s rules around this first. Some states allow real estate agents to run referral contests, in which everyone who sends you a referral is entered to win a prize. Make the prize buzzy, like a gift certificate to a nice restaurant. This will drive interest and, hopefully, get you more referrals.
4. Join a real estate referral network
If you have the opportunity to snag a seat in a referral networking group, take it. These groups, like BNI, consist of one person per industry — one real estate agent, one lender, one insurance agent, etc. And the sole purpose is to exchange referrals between the members of the group.
Real estate seats don’t usually open up very often, so if you can join one, I’d jump on it. BNI is the largest referral organization, yet plenty of others have formed over the years. Check with your local Chamber of Commerce to see if they have one in-house, ask your colleagues in other industries if they can recommend a particular group, or just Google referral networks in your area.
Another type of referral network is online companies that offer leads in exchange for a referral paid at closing. Some also require a monthly payment, but some are strictly a referral fee—zero out-of-pocket expense for you (such as Sold.com). This is a great way to add some additional transactions to your pipeline.
5. Practice to build your confidence
The more often you ask for referrals, the easier and more natural it will become. You’ll eventually reach a point where you don’t even realize you’re purposefully asking for a referral; it will simply become part of how you speak in everyday conversation.
To get to this point, consistently asking for referrals is key, as is practicing what you’ll say and how you’ll say it. Practice alone in the car. Practice on your spouse. Practice with a peer in the office or with your real estate coach. If you’re an introvert like me, check out The Quiet Success Club, where we regularly practice real estate conversations (like asking for referrals) as a small group.
Practicing will not only help change your natural language patterns, but it will also increase your confidence tremendously. People respond well to confidence. Many people expect it, especially from real estate agents. Once you start seeing results, your confidence will skyrocket. Until then, practice as much as you can.
6. Partner with other small businesses
Ask local business owners to keep you in mind when they hear about anyone who has a real estate need. Approach them from a place of being a fellow small business owner and entrepreneur. They’ll understand the value of referrals, and as long as you have a good relationship and they don’t already have a go-to real estate agent to refer to, there’s an opportunity to be their person.
Lead with value and do whatever you can to help support their business first. If you can send the company you’re partnering with a few referrals before asking for them to send you referrals, even better. Some tactical ways to partner include promoting each other on social media, interviewing the business owner and putting the interview on your website and on your social channels, hosting a charitable drive together, or hosting a client appreciation event at their location.
Some of the best businesses to work with are hair salons, estate planning attorneys, probate attorneys, divorce attorneys, wedding planners, and bars/restaurants. Don’t be shy about approaching any business you’d like. I’d start with business owners I already know personally, then branch out from there. Keep it simple and say something like: “I really love your company and would like to help you grow your business. I have a few ideas. Could we meet to brainstorm how I might be able to help you and your business?”
7. Give referrals to get real estate referrals
Also known as “come from contribution” or the “law of reciprocity,” this is an important part of receiving referrals. There may be an element of vibes, energy or woo-woo at play (if you’ve read The Secret, you know what I’m talking about). But regardless of that vibey-ness, giving before asking is always the right thing to do.
Plus, people feel indebted to anyone who’s done something for them or given them something. Let’s go back to the example of a business owner. If you send your hairstylist three new clients, she’ll be more likely to proactively look for a referral to send your way. There’s zero judgment here; it’s just how the human brain works.
Be sure not to expect anything in return, though. I’ve seen agents fall into this mindset, and it’s not good. If you’re expecting a referral back when you give one, a very weird and noticeable vibe soon follows. It also opens you up to disappointment and perhaps even resentment if you don’t receive a referral in return.
Think of it as helping as many people as you can with what they need, and trusting that you will receive what you need. The Zig Ziglar quote comes to mind: “You can have everything in life you want if you will just help enough other people get what they want.”
8. Provide exceptional customer service to every client
You may be wondering how this relates to real estate referrals. They’re very much linked. The better you treat your clients, the more they will rave about you and refer you to their friends and family. If you truly go above and beyond, they will talk about you to everyone, at least for a while after their transaction.
A good example I heard from a fellow agent is the story of a client closing on their house right before Christmas. They weren’t going to have time to decorate or even set up a tree for the kids, so the agent bought a Christmas tree and set it up in their new home before they moved in as a surprise. I guarantee they will be telling that story for years.
Providing exceptional customer service also applies to your leads, regardless of the outcome. Treat every lead well, and be incredibly gracious and understanding when you face rejection — which will happen — it happens to all of us. You never know — I’ve seen customers refer clients to agents they chose not to hire for themselves. It’s not the most common situation, but it happens more than you’d think. Rejection is actually a perfect time to ask for a referral, in some situations.
Example: Your family member hires another agent to sell their house. They feel terrible about not giving you the business, but they wanted to keep family and business separate. They’re also very private about their finances. This is the best opportunity to ask for a referral because they will want to find a way to make it up to you.
9. Personally thank all your referral sources
The best way to encourage more referrals from your current referral sources is to thank them. Every time you receive a referral, thank the person who referred a client to you…immediately. The outcome of the lead doesn’t matter. It’s important to reward the behavior (thinking of you and referring you), not the result.
It’s wise to keep the referral source updated and thank them again when the deal closes. If another agent sent you the lead and will be receiving a referral check, definitely keep them updated at each step of the process. Regular check-ins will make them want to send you more leads in the future.
How do you thank them? I’m a fan of the handwritten note. Handwrytten is a good tool if your own handwriting isn’t the best or you have too many notes to write (a great problem to have!). If the referral source is local, taking them to coffee, lunch, or dinner is also a nice gesture.
PRO TIP
Once you’ve built your business to a level where you have many referral sources, consider creating a VIP list. This is a section of your database consisting of the people who’ve sent you the most referrals over the course of the year. You can have special VIP dinners, send them a nice holiday gift, or make a point to see them in person more often than the rest of your database. Make them feel special and appreciated.
The bottom line
In my opinion, referrals are the best way to build your real estate business. Build your confidence by practicing and asking for referrals regularly, and keep in mind you’re simply looking for more people to help. That’s all. Be genuine, friendly, and always follow up. You’ll see your referral business flourish over time!
About Ashley Harwood
Ashley Harwood began her real estate career in 2013 and built a six-figure business as a solo agent before launching Move Over Extroverts in 2018. She developed training materials, classes, and coaching programs for her fellow introverts. Beginning in 2020, Ashley served as Director of Agent Growth for three Keller Williams offices in the Boston metro area. She’s now the Lead Listing agent for the Fleet Homes team in Massachusetts and a regular contributor to Vetted by HousingWire. She created The Quiet Success curriculum and has taught thousands of real estate agents nationwide. She has also been a guest speaker at top industry events and has been named a leading real estate coach by prominent industry publications.
English (US) ·