Property Management Growth with DoorGrow
DGS 217: Getting Investor Referrals in Property Management
Podcast summary created with Snipd AI
Quick takeaways
- Real estate agents are not reliable sources of referrals for property managers due to their focus on their own goals and lack of emotional connection.
- Building deep relationships with a select group of agents who work with investors is crucial for successful referrals in property management.
Deep dives
Why Real Estate Agent Referrals Don't Work
Real estate agent referrals don't work well for property managers because agents are primarily focused on their own goals and interests, such as making more money and closing more real estate deals. Asking for referrals or pitching to real estate offices often leads to little or no results because agents usually don't remember or prioritize property managers. One reason for this is the lack of a strong emotional connection or anchor between agents and property managers. Another reason is that many agents don't work with investors, which is a key target market for property managers. Furthermore, relying on agents to sell property management services is ineffective as agents are more concerned with their own tasks and responsibilities. Instead, property managers should focus on building relationships, creating depth and trust, and finding ways to demonstrate the value of their services. Connecting agents with opportunities to make more money and secure real estate deals can incentivize them to refer property managers to their investor clients.
The Importance of Depth in Relationships
One of the main reasons agent referrals don't work is the lack of depth in relationships between property managers and agents. Superficial interactions, such as pitching at office meetings or networking events, rarely lead to effective referrals. It's important for property managers to establish deeper connections with a select group of agents who regularly work with investors. This involves personalized and intimate interactions, including in-person meetings or video calls, that allow both parties to understand each other's needs and build trust. By focusing on depth rather than width, property managers can foster stronger relationships with agents and increase the likelihood of successful referrals.
Avoiding Real Estate Branding and Creating Safety
Another reason why agent referrals often fail is when property managers brand themselves as real estate agents or prominently display their real estate affiliations. Agents may perceive this as a threat to their own business and feel reluctant to refer clients to property managers who are potential competitors. To overcome this barrier, property managers should rebrand themselves as property management specialists, separate from the real estate industry. This creates a sense of safety and assures agents that their clients won't be taken away. By positioning themselves as dedicated property managers, they can gain the trust of agents and increase the chances of receiving referrals.
Real estate agent referrals can be a great source for leads in a property management business, but this strategy is often challenging and confusing for property management entrepreneurs.
Join property management experts Jason Hull and Sarah Hull as they dive into the world of real estate agent referrals and why they often don't work for property management entrepreneurs. Learn how to shift the focus from seeking referrals to creating impactful introductions that connect you with the right clients.
You’ll Learn[02:24] The Problems with Trying to Get Referrals from Realtors
[05:39] How to be Memorable to Your Clients
[10:31] How Going Deeper can Land You More Deals
[15:24] Challenges with Asking for Referrals
[17:44] Don’t Make Realtors Sell for You + Building Confidence
Tweetables“We have maybe three or four different bodies or parts of ourselves. We have our intuitive, we have our mental, we have our emotional, and we have our physical.”
“What I found was they'll have a logical mental memory of something, but a logical mental memory of something alone doesn't really stay there unless there's emotion connected to it.”
“If they're not excited or feel something, why would they be motivated to give you referrals or even remember you or think about you?”
“Depth is where the magic happens.”
Resources Transcript[00:00:00] Jason: They wake up every morning wanting something and it's not property management and it's not like helping their clients with property management that is not at the forefront of their mind, their heart and their desires. What do they want? They want money. They want more real estate deals.
[00:00:17] Welcome DoorGrow Hackers to the DoorGrowShow. If you are a property management entrepreneur that wants to add doors, make a difference, increase revenue, help others, impact lives, and you are interested in growing in business and life, and you're open to doing things a bit differently then you are a DoorGrow hacker. DoorGrow hackers love the opportunities, daily variety, unique challenges, and freedom that property management brings. Many in real estate think you're crazy for doing it you think they're crazy for not because you realize that property management is the ultimate, high trust gateway to real estate deals relationships and residual income. At DoorGrow, we are on a mission to transform property management, business owners and their businesses.
[00:00:59] We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. I'm your host, property management growth expert Jason Hull, the founder and CEO of DoorGrow, along with Sarah Hull, the co owner and COO of DoorGrow. Now let's get into the show.
[00:01:20] My iPad dinged. I didn't turn on do not disturb when it started. I need my— I have to have a pre flight checklist like right there. Like I got to do it. So, it's on do not disturb now. By the way, I was talking with a client this week. And he said that he had some of my videos playing in the background and he forgot and he came back into the room and he heard this voice talking, and he's like, "why is Ed Norton talking in my office?" You know who Ed Norton is?
[00:01:55] Sarah: No.
[00:01:56] Jason: All right for those of you listening, you probably know he's an actor, very famous actor, but apparently I might sound like Ed Norton, so I don't know.
[00:02:05] Sarah: I'm one of those people, don't ask me like, "oh do you know like this?" Don't name drop with me, I don't know who they are.
[00:02:10] Jason: She doesn't care.
[00:02:12] Sarah: I don't, especially if it's like a celebrity, now I really don't know.
[00:02:16] Jason: Yeah, she's like, they're not paying me.
[00:02:19] Sarah: I have no idea who they are.
[00:02:20] Jason: Okay.
[00:02:20] Sarah: I don't know. Alright. I can maybe name like five celebrities.
[00:02:24] Jason: So our topic is, and we had a question asked about this in our Facebook group in the DoorGrow Club. So if you're interested in what I told him and the coaching that— I created a video and I put it into there, go check it out You can go to doorgrowclub.Com. But the topic was— He was basically frustrated about getting agent referrals. Like how do you make this work? So a lot of property managers think a great lead source would be getting referrals from real estate agents, but we found that it doesn't work very well if you're asking for referrals. And so I wanted to talk about why real estate agent referrals in property management don't work. And maybe if you can understand why it doesn't work, you might be interested in reaching out to DoorGrow and learning how we make this work really well. So what typically happens with people that go out and they think "I'm going to go get some real estate agents to give me referrals 'cause they might know some investors."
[00:03:23] Sarah: Yeah. And I did it too. So like, I'm guilty as charged, but it was like, "Hey, so if you ever know anybody who needs property management, then just like, let me know, like, here's my card, here's my information. Like, just give me a call."
[00:03:36] Jason: Yeah.
[00:03:36] Sarah: " Keep me in mind." It doesn't work.
[00:03:39] Jason: Or they'll go and like, "Hey, could I present to your office about property management?" and so they'll go do to the real estate office. They have their morning meeting, you know, in their office maybe once a week and they go present and they sit there and they pitch and talk about property management and how they're so good and all this stuff. And then at the end, they're sitting there insecure, wondering like, "Why was everybody just eating donuts and looking at their phone the whole time?" you know, and "nobody's coming up to me." And maybe one person says, "Hey, nice presentation," you know, and then you walk away with nothing, and they don't really care about you, right? So, why doesn't this work? Because a lot of people try this. Why aren't they getting tons of referrals from real estate agents?
[00:04:22] Sarah: Well, there's a lot of different reasons. I think one of the big ones is we're just relying on people to remember you like "oh, hey if you need, you know If you come across somebody who needs property management, then you have to just remember that I do it and then hopefully You know, pass it on over to me." and they're not going to remember you unless there's a really good reason to there, especially if they don't see like a benefit in it for them. So if you're like, Oh yeah, who paints houses? It's like, now I have to go find people that paint houses. But very rarely do we have like this Rolodex in our head of, you know, people who do certain things. We do have connections to people who do things that we refer out to a lot. So for example, in real estate, you might know somebody that paints houses. You might know somebody that cleans. You might do, you know, know someone who does some like handyman work. Because if you've got a client who's buying a house and they're like, yeah, but I hate the color. It's like, "oh, don't worry. I'll just send you to John and he'll paint the whole thing for you, right?" But property management is a little bit different unless you're working with a lot of investors, then you probably just don't need to have a property manager, like in your Rolodex. So that's one of the first reasons why it doesn't work.
[00:05:39] Jason: Okay. So, I like what you said about it not being memorable. So I'll talk about memory real quick. So we have, you could say that we have maybe three or four different bodies or parts of ourselves. We have our intuitive, we have our mental, we have our emotional, and we have our physical right? And I used to do, you know, some emotional processing work with people like I would help them work through emotional stuff. And what I found was they'll have a logical mental memory of something, but a logical mental memory of something alone doesn't, they don't retain it, or it doesn't really stay there unless there's emotion connected to it. And so. The example I like to share with people is I just asked him, what were you doing on the day of 9 11? And what was the weather like? And they can usually remember quite a bit in detail, even though it was quite long ago. And I say, what was the day like 2 days before? And they're like, "I have no idea," right? Because there's no emotion. Maybe if they were hypnotized, their logical brain could go, "yeah, I could, I remember this," but we don't really retain things well, if there is an emotion connected to it. So that's one of the reasons why they don't, they didn't feel anything in you talking to them. They don't, they're not excited. If they're not excited or feel something, why would they be motivated to give you referrals or even remember you or think about you? So the anchor that we've created with them is— And anchoring is a neurolinguistic programming tactic. You can do this very strategically and effectively. You can create anchors. You also can create emotional states in people by the way that you communicate and maybe even listen to this. You're like getting a little bit excited. You're feeling a little bit excited about getting agent referrals, but you still don't know how it works, right? So what I did is I just created a state in you just a little bit. All right. So, the reason I think agent referrals don't work is because real estate agents don't care about you and your business.
[00:07:39] Sarah: The other reason they don't care: why would they don't care about what somebody else is doing? They're not, you know walking around going. "Oh, how can I help you today? How can I help you today? And how can I help you?" They're like, "what am I doing? Like, what's on my plate today? What do I have to do?" And the sooner we realize, like, hey, people are just in their own little bubble. Like, they're worried about what is right in front of them. And like, what are the tasks that they have to focus on? And what's going on in their life? And what are they thinking? What are they feeling? They're not very often stepping outside of that to go like, "Oh what is he feeling today? And what is she feeling today? You know, what are you dealing with?" People are very concerned with, you know, what they've got going on and that's just, that's normal. So we need to kind of just understand that and then figure out, "well, okay, if that's the mindset and the headspace that people are in knowing that, what do we do differently?
[00:08:36] Jason: Yeah, I think we need to figure out like, what do they actually want?" They wake up every morning wanting something and it's not property management and it's not like helping their clients with property management that is not at the forefront of their mind, their heart and their desires. What do they want? They want money. They want more real estate deals. And so you have got to connect them getting more real estate deals to them connecting you to their investor clients. You've got to figure out how to make that connection. So we have this very well scripted out. We have our clients that are, let's talk about some results. Like some of our clients, one of our clients, one of our best success stories this year in less than a year has added 400 doors in less than a year without really focusing on paid advertising really at all, right? Contrast that. So they've broken the thousand door barrier. Another client came to us and they have I think 1300, 1700 doors and their BDM bought 322 leads from a lead service, like, I'll just say APM. They bought it from APM and they closed 18. They closed 18 in the last year of those. They got 18 doors in the last year. If you calculate what each of those probably costs and they have a full time BDM that they're paying to work this, they have a setter that they're paying.
[00:09:56] Like this is expensive with the per deal acquisition costs must be ridiculous. If they spent all of that time and all of that money and all. You know, follow up and everything else doing the strategies that we teach a DoorGrow, they probably could have, they might've been able to double their portfolio over the last several years. They're just churning and burning through all this energy, time, focus, cash and effort. Like, it's super wasteful. So, one of our clients added 310 doors just using this strategy in a year from only five or six agents. So a couple of things, the reasons that agent referrals don't work, we've established, they don't care about you, they care about getting more deals. You've got to connect that you aren't making them feel something. They want to feel excited. They feel excited about getting more deals. You're creating a weak anchor. Other ways in which this isn't working is that. You're not really getting to know them well enough. There's not enough depth in the relationship or a connection. They're not going to connect you to somebody unless they feel really safe with you and they like you. And so a lot of people are trying to do this so superficially, like "let's go pitch to a whole group and maybe I'll magically get a bunch of leads that come in from them." There's no depth there.
[00:11:14] There's a lot of width, right? You're hitting a lot of people, but depth is where the magic happens. This is probably the greatest secret I think that we teach in helping people grow and add doors rapidly is we just get them doing depth in a way that none of their competitors are doing it. Going deeper. That means more personal, more intimate, more one on one, like focusing on like in person or video, whatever's the deepest things that you can do, you're going to grow faster. So I think there's also a lack of depth is a challenge. I think also with why agent referrals don't work is because nobody comes up to them and says they need property management. This almost never happens. And if it does—
[00:12:01] Sarah: If they do, they're not the ones you want to take on.
[00:12:03] Jason: Right.
[00:12:03] Sarah: Like, "Hey, I desperately need a property manager. Please help me. Like, I don't want that.
[00:12:08] Jason: Yeah.
[00:12:09] Sarah: I want somebody who's we know without even asking any further questions, this is not going to be a great property to take on.
[00:12:15] Jason: Yeah. Their hair has to be on fire or that like to call their agent up and say, "Hey, this rental property, it's a nightmare for me. I have this huge problem. I've got an eviction. I need to get done. It's a meth house. Like they, they burned down the back porch. Like it's leaking. Like they, like, they won't let us in. They've got a pit bull, right? Whatever, right? It's a nightmare." And for you to take it on, you would, it would probably—
[00:12:42] Sarah: They're breeding dogs and the tenants were addicted to drugs. One's in rehab. One just died. Now we have I think there was like 12 dogs in the house. There were puppies. We had to do like a puppy rescue.
[00:12:54] Jason: Oh gosh.
[00:12:55] Sarah: We've seen it all. Super fun as a property manager.
[00:12:58] Jason: Yeah. The things you property managers have seen, right?
[00:13:00] Sarah: It's like, "oh, hey, you know what? Jason does property management. Let me call Jason." And Jason was like, "I don't want that." I'm like, "why? No. Like, thanks for thinking of me, I guess." And now, that almost, like, shoots you in the foot even worse, because now it's like, "hey, well, now I have something to give you, and I gave it to you, and you don't even want it?"
[00:13:19] Jason: Right.
[00:13:19] Sarah: So now we're like taking what could be a good relationship and kind of saying like, yeah, well, thanks for that lead, but it's garbage. Yeah. Thanks for giving me the shittiest thing you could possibly find.
[00:13:30] Jason: Yeah. The worst thing you could do is finally get them to give you a referral. You've been bugging them over and over again. They're like, "here, somebody came to me, here you go. And can you help my client out?" And you're like. " Do I have to? Like, I don't want to change somebody else's dirty diaper." Like you don't want to deal with this. You don't want to deal with this problem.
[00:13:48] Sarah: Right. And it's probably not gonna be profitable for you. It's probably not like if I think if a lot of property managers ran a profit and loss statement, or like a cost analysis on each individual door, which some of those low rent doors would not be profitable for you, right?
[00:14:05] Jason: You should know some of those owners.
[00:14:07] Sarah: These are part of, yeah, these are part of knowing your financials. We have a whole course in here about it, but there are certain data that you should just know in your business, you should know which doors, you know, are profitable, which doors maybe are not so profitable, which clients are and are not profitable. You should know all of that. But if you really start to dig into that, you're right. You're going to see very clearly like, Hey. This one doesn't quite measure up to, you know, what we're hoping for. But if you're just waiting for somebody to go, "Hey, I need a property manager. Like that's what we're getting. We're getting the, "Oh my God, I have this like awful situation and now I need somebody like that's what we're waiting to get."
[00:14:50] Jason: Yeah. I mean to expect that a bunch of people are just going to walk up to a real estate agent and say, "Hey, I need a property manager. Who do you got that almost never ever happens. It's super rare. Now, some of you have gotten some referrals from agents and it might've been some sort of scenario like that. Like they came up to him and said, "Hey, they need a property manager," but it's probably super rare. So you're probably not getting, you know, 10, 20, 30 doors a month from this engine. The other challenge why agent referrals don't work is a lot of real estate agents don't even work with investors. Most real estate, 50 percent of real estate agents in the last year, the stat I heard was they didn't even do a single deal.
[00:15:38] Sarah: Oh yeah. Yeah, I was talking with a client, I think yesterday with anyone with them and he's in the Miami market and like in his like city alone. I think there was something like 60, 000 agents, but out of those 60, 000 agents, like, you know, they're not all active and then out of the ones that are active, like, what are the ones that I've actually done a deal? What are the ones that actually do multiple deals? And then what are the ones that actually work with investors?
[00:16:04] Jason: The ones that actually work with investors must be a pretty small pool. Like maybe they'll do a deal occasionally, but how many agents are regularly working with investors? All the time, and they have a Rolodex and a pool of a bunch of investors that they have connections to not very many. So, our client that added 310 doors in a year, he did it from only 5 or 6 real estate agents he told me. That was it, but he said he tried calling a 1000 to find those 5 or 6. So that's a lot of deals from very few. He had to kiss a lot of frogs to find a few princesses. Right? Or princes, whatever. So, now, a lot of real estate agents are working with investors. So you need to find the ones that do. So this is another reason why referrals don't work. You go pitch to a office meeting. You might as well just like— well, I'm not going to give away all our strategy, but you might as well just ask, like how many of you work with investors? If no one's raising their hand, you might as well just end and say, "cool, if you find anybody, send them our way." And that's my time, right? You don't need to be wasting your time. Another reason referrals in general don't work is that you don't even go to the right audience. So if you're going to real estate agents that don't have investors, that's the wrong audience. Some go even worse than they go to a BNI group where there might be one real estate agent only, or they go to a chamber of commerce, or some sort of networking groups and they're like, "Hey, everybody, and nobody there really has rental properties. Maybe like, they're not even an investor or they don't have connections to investors. And so those kind of things can be a big time, suck or a waste of time when there's way more effective strategies. So now, another reason why referrals, agent referrals for property managers don't work is you are, if you're asking for referrals, which is the wrong thing to actually ask for, you're expecting them to sell for you. So, the idea of a referral, if we break this down, is somebody's going to come up to them. And say, "I have this problem. They're going to say, let me sell you on this idea of getting a property manager and then connect you to somebody." You're expecting them to sell for you. The way our clients are winning this game is we've set it up so that you get to sell. The client, our client gets to sell, not the real estate agent. So what we teach instead is to focus on getting introductions. So, so that is— and if you want to learn more about that, we recommend you get into our program because our clients are crushing it. We have scripts for this, all of this. All right. Any other things about this that are not why realtor referrals don't work for most people?
[00:18:48] Sarah: I think that about covers it.
[00:18:50] Jason: I think if I were to add one more thing, it would be a lack of confidence. So a lot of property managers don't go into these situations knowing clearly how to get Referrals to come from them. They don't know how to create these relationships effectively. They don't know the language, the scripting to use. Oh, this is a big one that we missed. Another big reason is they're not going to refer to you if your business is a real estate brand. This makes them feel very unsafe. So this is why we rebrand a large percentage of our clients. If your brand has 'real estate' or 'realty,' or they know that you're a real estate agent, it's like all over the tin. They don't want to send people to you because they don't want to lose their clients and they're afraid of their clients being stolen by you. And everybody says, "Oh, well, I'll just promise I'll refer them back," but their clients might put pressure on you or know that you do real estate. You need to create a scenario in which they're going to feel safe connecting clients to you so that you look like property management, not real estate. So those are some of the big ones. So, I think that's basically it. I think that's pretty comprehensive. So realtor referrals for most people are not working. And if you'd like this to work, what should they do?
[00:20:09] Sarah: Well, you can talk with us. You can book a call. You can check us out online at doorgrow.Com. We also have a free Facebook group and you can check out our Facebook group. There's a lot of information that we have out there available for you guys, but check us out. And if you're like, "I just don't know." That's okay. Do some research like where I think our results speak for themselves.
[00:20:33] Jason: Yeah. Nobody has as many case studies as us. We put out 40 testimonials or case study videos in the last year. And these are just captured during our coaching calls. Our clients are crushing it. And nobody is moving forward or innovating as quickly as DoorGrow when it comes to coaching. So join our group coaching mastermind. You can get all the details by going to doorgrow.Com. There's a big pink button on the page say "you want to grow." Click on that. It'll give you the three steps that you need to take in order to potentially work with us. We don't just like work with everybody. We want to work with people that are willing to put in the effort, but we're actually going to reduce the amount of friction and effort and time that it takes for you to get business on by doing more effective strategies. So reach out to us at DoorGrow. So I think that's it. So until next time to our mutual growth, bye everyone.
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