Can a referral agent make money in a Sellers Market?

Question

I am planning on getting my license to become a referral agent part time while i work at my full time Job. Before I can move forward I'd like to get a professional's opinion. Seeing as though a sale through a referral agent will mean less commission for the realtor, and considering the fact that in the market I am in, prices are rising which means more demand, could a referral agent actually find a Listing agent who is willing to accept lead's from a referral agent? I know it all depends on my relationship with the person, as well as the % I am asking.

If you are in a really hot market, would you take in quality leads from a referral agent if they are asking for 25%?

Btw I am in wilmington Delaware. I am no expert but based on what I can see prices are rising, so I will assume that we are in some kind of hot market. All answers are appreciated. Thanks!

If you are in a really hot market, would you take in quality leads from a referral agent if they are asking for 25%?

Btw I am in wilmington Delaware. I am no expert but based on what I can see prices are rising, so I will assume that we are in some kind of hot market. All answers are appreciated. Thanks!

John King · Answer

For the most part, I agree with Russell. HOWEVER, if you are in a position or are a master networker kind of person, you could kill it. Think of yourself more as a Business Development person... you could do well.

#1. Make sure anyone you refer knows that you are referring them, and to whom they should expect to be calling them. It would be bad form if you were just gathering phone numbers and passing them off as leads.

#2. Most agents ARE willing to pay a referral fee, especially of the leads are good. It is worth cultivating relationships if you're going to do this and not be a one off. Consistently refer to the same person, and they will take exceptional care of your referee's.

#3. There are referral networks that you can get in to. Primarily, they are for referring out of your area, but I know some that use them to refer out clients that they don't get along with, but prefer not to totally lose that commission.

Best of luck!

Martha Nowlan · Answer

I'll always accept a referral as long as it isn't more effort than it's worth (basically, if it's a lead I wouldn't want anyways because they want to buy a $100k house 2 hours from me, no thanks). You'll do just fine! Build partnerships with hungry new agents.

Post referrals on Biggerpockets first... then post on facebook groups, you will get multiple responses and can interview different agents. Not sure why everyone is discouraging you! Do it up dude.

Brandon Stewart · Answer

Thanks for the reply @Dan

@Dan Bernsteinundefined

Dan Bernstein · Answer

@Brandon Stewart, Although @Russell Brazil is correct for the most part, there are a few agents I know of that do nothing but refer business out and crush it. Many agents start as part time, and if you have the network, it won't be difficult to sell 1-2 homes every few months or refer it out. Expect only 25% on a referral.

Brandon Stewart · Answer

Thanks for the reply @Russell Brazil . Do you happen to know why that is? For the kind of work that I do, I come across a lot of people getting ready to move. I can understand if a referral agent didn't make any money because they didn't refer many people, but it would be very disappointing if a referral agent referred many quality leads but still made no money.

Russell Brazil · Answer

Honestly most agents who have their license in referral status are going to earn zero dollars. If you are lucky, maybe you might get 1 referral fee.

Can a referral agent make money in a Sellers Market?

Can a referral agent make money in a Sellers Market?

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