Written by The Goal: Establish yourself as the neighborhood area expert, making you the obvious choice to call.
Traditional real estate farming is based on a pattern of regular mailing to a geographical area – a successful campaign should result in a 20 – 30% market share of listings 🙂
Mailings are usually based on high quality postcards sent on a regular monthly basis, possibly mixed with newsletter updates or even handwritten cards and/or letters.
With a database of neighborhood addresses, combined with a matched social media audience, agents can target homeowners on Facebook and other platforms to enhance their traditional efforts.
After sowing your first seeds, some early results are certainly welcomed, but the campaign will typically need to run for at least 9 or 12 months before agents will see a return on their investment.
Read on to learn how to mix traditional methods with these newer tools – step by step:
Key requirements for a successful real estate farming campaign.
- A suitable geographic neighborhood.
- Relevant neighborhood information.
- Repetition to create mind share.
Choosing the right geographic neighborhood for your real estate farm.
Your neighborhood should be one that you are already familiar with and should ideally be your own neighborhood or one close by.
The ideal real estate farm will consist of no more that 500 homes – but this strategy is repeatable so you can create multiple farms, one after another to multiply your results.
Use your MLS to find recent statistics. You will want to make sure that there is a decent enough turnover to warrant the time and expense of your campaign,
Get your research right – you are going to spend lot’s of $$$’s and energy to make real estate farming work. When you activate your plan, you should be capturing up to 30%+ of the listings in your farm!
Neighborhood turnover rate
We suggest you look at at least 24 or 36 months of data, as 6 to 12 months are too short to establish a pattern. For the turnover rate calculation you will need the number of homes sold and the current number of active listings.
For example, let’s say 50 houses have been sold in the past 12 months. There are 500 homes in the area. Therefore:
(500 ÷ 50) = 10% annual turnover rate
Ideally you’ll want to see 5% turnover rate or higher. Anything less won’t pencil out. Just in case it was a blip, look at the previous year and the one before that to look for a trend. Some neighborhoods will definitely follow a cycle of activity.
Avoid neighborhoods with dominant Realtors
Inspect the turnover rate list by listing agent as it’s going to be more difficult to dislodge a dominant realtor with more that 30% of total sales. Ideally you are looking for a neighborhood with many different agents, not just one major player.
Absorption rate & Turnover calculator
Absorption Rate is a a prediction of how many months worth of inventory are in a particular neighborhood, that determines your potential farming success.
In this example – if current market conditions continue with no new listings come on the market, it’ll take 4.9 months (the absorption rate) for the current inventory to sell.
Take note: A balanced market’s absorption rate will typically be between 5 to 7 months. In a strong sellers market this can be considerably less.
This table is editable – enter your own data in the red/bold cells and in the yellow cells to compare potential Farm neighborhoods.
[supsystic-tables id=8]
Once you have finished editing you can print or email your calculations for future reference.
Return on investment calculator
We have seen it happen so many times. Agents will start a farming campaign only to abandon their efforts when no immediate returns are received, or when the next shiny object is promoted by an industry guru.
Proper planning and realistic expectations are the keys to successful farming, so go ahead and examine the typical cost of a 12 month campaign – we laid out the basics in the chart above.
We made general assumptions for the cost of a typical mailed postcard along with a 15% marketing budget to predict the Potential Profit from a successful campaign – the results are definitely not to be sniffed at 😉
Start by creating your mailing list.
In some States it’s customary (and legal) for a Title Company to supply agents and brokers with mailing lists – typically a list generated from County title records. Please check with you own State DRE to make sure it’s an approved practice.
If you are a paid up member of NAR you have access to RPR, the Realtors Property Resource (owned and funded by NAR) which provides members with free services including the ability to create mailing lists generated from data as well as map searches.
You can use either of the above resources or a print/mail service such as WisePelican or GeoGraphicFarm to create your farm mailing list. You may wish to include/exclude certain property characteristics ( 3 bedroom house not 4 bedroom) or home owner type (absentee owner etc). to create your perfect list.
EDDM (Every Door Direct Mail)
EDDM is a creditable alternative to custom lists. The plus is it’s a lot cheaper (postage is .17c vs .51c), the minus is you have to send to all the addresses on the route.
If you choose an EDDM route you would typically have the postcards printed and mailed to you, so that you can drop them off at the appropriate sorting office. Here is a screenshot of the EDDM site where you can select the route, get a quote and the drop off address.
There are a number of companies that offer a complete EDDM solution (including printing and mailing) – take a look at Excel Printing & Mailing, Print Out Loud or Got Print.
Ideas for your postcard campaign.
At a loss to know what to send to your farm? Here are some proven ideas to incorporate in your geofarming campaign:
- The past year neighborhood sales data
- Holiday greeting cards
- Feature an extra-special property
- Postcards with relevant community updates in newsletter style
- Seasonal open house invitations promising food and drinks
- Find local business coupons or gift card to send
- Include favorite recipes
Combining social media with traditional real estate farming.
This is where it starts to get really interesting!
If you have a list of street addresses, there are services that will augment an address with names, phone numbers and email addresses
One such service is Cole Information a company that has been around for over 60 years.
With a subscription to Cole you can search by address, street level, subdivision or an entire zip code(s) and filter by 250+ data attributes such as year built, age of residents residing at the property, credit range, income, home value, length of residence, make/model and year of vehicles, hobbies, race, language and much more!
With Coles PRO plan you can upload any list addresses you might already have access to and get unlimited appends of contact information. – we have secured a special discount of $200 off their PRO subscription to try out their service.
This service has other possibilities too: For instance you could retrieve information on a neighborhood and call and/or email all of the neighbors around your Just Listed and Just Sold properties.
Once you have your augmented list you can move onto the next stage.
Creating your targeted custom audience Facebook list.
It’s been possible for some time to create Facebook custom audiences, but I suspect many have been a little intimidated by the process. Let me assure you it’s as simple as uploading an email list and letting Facebook try to associate your list with existing Facebook users. Your new custom audience list can then be used to target Facebook adverts. Zapier have posted an easy to follow tutorial on how to create your audience.
You have now matched up your geographic farm list with a list of Facebook users, targeting homeowners both offline with postcards and online with ads in their Facebook stream 🙂
Add a text messaging and an email campaign along with ringless voicemails and you are now really starting to get their attention! Look at OspreyCRM which offers to simplify the task of staying in touch and nurturing potential clients in your contact list.
Real estate trainer Kevin Smullin runs through how to use Cole Resource to match physical addresses to email addresses and then use them to create a Facebook advertisement that works!
Targeted advertising on social image sites.
Some real estate agents might prefer to target future clients on Instagram or Pinterest. Instagram is a little easier if you are already targeting Facebook users – it uses the same platform!
Targeting Pinterest users works in a very similar way to Facebook/Instagram. Customer List Targeting is a tool that allows advertisers to target Pinterest users through their already existing email lists, compare their list to users on Pinterest.
It’s very interesting to note that eighty percent of Pinterest pins are repins, which means that sharable content is highly valued. The average lifespan of a pin is three months – bear in mind that Facebook only averages five to six hours, and Twitter averages 5-20 minutes.
Pinterest Business accounts are worth exploring as the offer analytics and other worthwhile tools. Advertising “Pins” on Pinterest is a whole different art unto itself, so we suggest that you review this extensive tutorial to see if this medium will work for you.
Using NextDoor to digitally door knock.
Many of you will be aware of Nextdoor, an app that connects distinct geographic neighborhoods to it’s residents.
Nexdoor has several options for real estate agents to engage with these audiences – some for free …
… and who doesn’t like free!
Nextdoor has 100% verified real people with 100% member verified addresses, 75% of which are homeowners which means there is are excellent opportunities to connect and add value to users integrations on the site.
There is a very useful guide for real estate agents outlining what’s available when using the Nextdoor platform. Agents should start by creating their free business page which entitles them to 2 free postings every month and might also consider sponsoring a zip code.
Turning cold leads into warm clients.
Social media ads cannot replace traditional farming techniques, but they can sure go a long way to enhancing your efforts.
It can take as many as 15 touches before contacts are ready to convert into clients. Adding social media touches to connect with the contacts in your farm will create recurring opportunities to be top of mind when they start considering a move.
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