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Understanding the Power of Referrals in Real Estate Prospecting

Prospecting is the life of getting more clients and business in today’s real estate industry. In my honest opinion, it’s an essential activity that must be performed by every real estate agent regardless of their level of experience and skills. It’s an important real estate activity that demands special attention and time, and therefore, real estate prospecting can seem to be a time-consuming task to agents working with multiple clients at the same time.

For individuals who want to spend the least amount of time and efforts on finding prospects, referrals could be the best mode of real estate prospecting. It’s one of the easiest yet powerful methods of real estate prospecting that is sure to get you a good number of qualified leads and clients. I use this method all the time at Platinum Real Estate and it never fails me. However, it is important to know that you can get referrals only if you provide high-quality services to your existing clients. Otherwise, your clients would hesitate recommending your services to their colleagues and friends.

To help my readers further understand the potential of referrals, I am listing 3 reasons why referrals are so powerful. Read on and use the same prospecting method to excel in your real estate career.

Why Referrals Are So Powerful?

1. Because They Come From a Credible Third-Party

The primary reason behind the power of referrals is that they come from an unbiased third-party individual who has first-hand experience of working with you and who understands that you will provide the best customer services to their colleague or friend.

When a client who was worked with you in the past, refers your services to their acquaintance, they provide them a realistic preview of your services. This means that the prospect has complete information about the pros and cons of working with you. The prospects generated through referrals know that their friend has no hidden motivations and they are referring your services solely because of quality.

2. Because Research Proves So

According to a research study conducted by Paul and Sarah Edwords, over 45 percent of the customers choose a particular service business based on the recommendations of a friend. This number gives us an idea about the business-generating potential of referrals.

Another survey conducted by Dun and Bradstreet concluded that referrals is one of the two most-used marketing methods used by small businesses. This is mainly because finding clients through referrals is easier, less time-consuming, and more effective than other conventional methods of real estate prospecting.

3. Because Referrals are Directly Related to Customer Satisfaction

You must have heard business owners proudly saying that most of our business comes from referrals. The primary reason behind this pride is that referrals are an indicative of your customer satisfaction rates. Businesses that generate most of their revenue through referrals usually have strong processes and responsive customer services department.

When developing your real estate prospecting plan, it is important that you establish a referral program for your loyal customers. To learn more about developing real estate referral programs, you can always contact me through my websites, Luther and Platinum Real Join me January 23rd, 2016 for my FREE Million Dollar Producer workshop for more information visit

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