Over the course of his career, Lombari has hired around 800 real estate agents. To vet them, he created a list of the nine reasons most new agents don’t succeed.
During each interview, he runs through list with the prospective agent. Inevitably, they are going to have issues with some, but he says three should be the limit.
“A candidate with more than three is essentially a ‘dead man (woman) walking,’” he wrote to Inman.
During a follow-up interview, he broke down the list.
1. They don’t spend enough time on task
Lombari told Inman that when new agents start out full time, they generally need to dedicate at least 20 hours a week to their career.
“You can’t become really successful in real estate if you’re devoting very little time to it,” he said, adding that when he first started out, he worked 60 hours a week.
If new agents say they’ve only got about five hours a week to spare, he tells them it will be nearly impossible to get business off the ground.
2. They don’t have enough of a financial cushion
New agents may wait several months before getting paid. For Lombari, he waited a year.
It’s crucial, he told Inman, that they have enough money set aside to cover four to six months of living expenses.
If the agent lives off of a dual income, Lombari continued, they should set aside whatever their portion for those months would be.
“Assume you’re getting zero. What would you need to fulfill your portion of that income for six months,” he said.
3. They lack family support
It’s important that a new agent’s family is aware of their long schedule, which can take over weekends and evenings.
Transparent conversations are key, Lombari explained. He said new agents should ask themselves, what sacrifices will their family make in the short term?
4. They lack focus
Having a lack of focus goes hand in hand with the first issue on this list: not spending enough time on task.
If a new agent has hobbies or commitments outside of work, they need to be able to effectively time-block, Lombari explained.
When an agent is putting in their hours, he continued, distractions need to be limited. Things like TV and social media can take chunks of the day away.
5. They are unwilling to hold themselves accountable or be held accountable
A real estate agent is both the boss and the employee, Lombari explained.
“Most real estate agents, when they get in the industry, have never been a business owner before,” he said. “So there are inherent challenges with that.”
Not only do agents need to do the tasks, but they also need to have long-term vision and planning. “The challenge is wearing both of those hats at the same time,” he continued.
There are going to be parts of the business the agent doesn’t want to do, like cold calling. As their own boss, they need to have the discipline to do the tedious tasks.
If switching hats is a weakness, Lombari suggests find a mentor or a coach. “If you aren’t the right boss, find one,” he said.
6. They aren’t willing to learn
“An agent getting into real estate sales is totally ignorant. The state course requirements are only intended to help keep the public ‘relatively’ safe,” Lombari said.
To have a successful business, he continued, an agent needs to be willing and to learn the following:
- The market (macro and micro)
- The contracts
- How to negotiate/think of solutions
- How to prospect/find clients
- The technology (electronic signatures, websites/mass email/CRMs/ MLS/ IDX/ etc…)
- Luxury/ foreclosures/ commercial / relocation / military / seniors / second home/ etc.
7. They aren’t responsive
How long should it take a new agent to respond to an inquiry?
It depends on how badly they want the business, Lombari said. If an agent is in the position to answer when they get an inquiry, they should wait no longer than five minutes.
“The consumer does not care about you and has a million options,” Lombari said. “Respond immediately, you are a business owner!”
Boundaries should be thought about and set in the beginning. Then, agents should live by them.
If there are certain days or hours during the week an agent is busy, they should tell their clients right away, Lombari explained. And, if an agent misses a call, they should have a voicemail detailing their schedule so the client knows when to expect a call back.
8. Their business lacks systems, models and training
New agents need to create clear business plans that suit their needs, Lombari explained.
How many transactions do they need to complete to hit their target income? What models will they adopt when it comes to prospecting? What CRM are they going to use?
New agents typically bounce around between systems and models, Lombari said. But the sooner they can pinpoint how they are going to run their businesses, the sooner they can become experts at it.
9. They lack grit, drive and determination
“This is the most powerful of all,” Lombari said.
If new agents have grit, drive and determination, they can conquer most bumps in the road.
“Can those weaknesses be overcome with sheer determination? They can, but it really takes huge intention and drive to do that,” he said.