When Gary Gestson started in the real estate business seven years ago, he marketed himself to the masses. He made cold calls, reached out to his sphere of influence, and focused on becoming the go-to guy for real estate in his neighborhood.
The problem? There were thousands of real estate agents in my area who were doing the same thing, says Gestson, a salesperson with Long & Foster Real Estate Inc. in Gaithersburg, Md. And although he was making a decent living, he wasn't having very much fun. Selling houses that all look alike quickly became boring to me, he says.
About six months into his career, he jumped at the chance to work with a buyer who wanted something different-a historic home. The search process was far more time-consuming than usual, he says. We looked at every home from Brunswick to Baltimore before the buyer decided on a 1930s cottage in Gaithersburg's Old Towne neighborhood. But he didn't mind. It was during that time that I fell in love with historic homes, says Gestson, who spent more than 20 years as an art dealer before getting his real estate license. Every home I looked at was like a new adventure.
Four years later, after creating the Historic Homes Team and launching a niche Web site
(www.historichomesteam.com), Gestson was the top producer at his office. And while other practitioners in his market have struggled with a housing slowdown the last couple of years, he's had a steady stream of business. In fact, 2009 is on track to be a banner year, he says. Having a niche allows me to focus my marketing efforts, he says. I don't have to reach out as much as I did before. People find me.
Another perk of being a specialist: His clients tend to associate with other historic-home enthusiasts. If I've got one satisfied customer, I've got 10 referrals waiting, Gestson says. My clients are very qualified and they're buying something for the long term. They want to work with someone with specialized knowledge.
Research shows that Gestson is right. A 2008 survey of buyers and sellers by the NATIONAL ASSOCIATION OF REALTORS® reveals that 80 percent of buyers would prefer to work with a real estate practitioner who's focused on a particular type of property. While specialization has always been important, industry leaders say it has taken on an even greater importance in recent years-and not just because of the challenging economy.
If you look at society today, it's all about specialization, says REALTOR.com President Errol Samuelson, who led a session on Web marketing at the 2009 REALTORS® Midyear Legislative Meetings in Washington, D.C. Consumers are trained to look for personalized experiences. It's why there are 500 cable TV channels instead of everyone tuning into the same network news broadcast every night.
Yet the real estate industry doesn't seem to have embraced specialization as fully as other sectors, Samuelson says. REALTOR.com's marketing research team recently surveyed a wide swath of real estate practitioners' Web sites and found that only about 11 percent indicated a specialty of any kind. Although the survey wasn't scientific, the results suggest there are opportunities for you to stake your claim to a real estate niche that fits your interests and market dynamics.
On the Hunt for a Specialty
Ready to find your profitable niche? One way to start is by looking inward, identifying your special skills, knowledge, and passions. Gestson realized he had a zeal for historic homes and was able to parlay skills from his days selling antique works of art to help sellers market their one-of-a-kind properties.
Likewise, Ginny Mees of Keller Williams Realty in Danville, Calif., found that her experiences buying and selling homes as a single mom made her well suited to help other independent women. You end up gravitating toward what you love to do, says Mees, who organizes real estate workshops on issues such as whether to keep a home after divorcing. She recently launched an online network for women at
www.womenhomeowners.com. The site provides a range of free resources for women and allows users to search by ZIP code for experts in homeownership issues. Mees hopes that other practitioners around the country will join the network for a fee to connect with women buyers and sellers in their area. There's no better way to differentiate yourself, she says. Mees notes that her meetings and Web site are open to everyone, not just single women.
As helpful as it is to have a personal connection to your niche, Mees says your decision can't be purely sentimental. You have to have the market data to support your business focus. Mees, for example, cites NAR's 2008 Profile of Home Buyers and Sellers, which shows that single women comprise 20 percent of buyers, up from 14 percent in 1995. She investigated the numbers after noticing that more and more of her clients were single women. I didn't find my niche. My niche found me, she laughs.
Sam Miller, CRS®, GRI, of RE/MAX Stars Realty in Mount Vernon, Ohio, took an even more methodical approach to choosing a specialty. In 2001, after 15 years in the real estate business, Miller felt that his success had leveled off. He had set a goal for his seven-person team to average a sale for every day of the year, but no matter what they did, they couldn't surpass 260 property sales a year. After evaluating growth potential within a 20-minute drive of his office, he identified a 2,400-home lake resort community, Apple Valley, and decided to center his business on that area.
He built an intricate database of people who owned homes or vacant lots there and then categorized properties by waterfront, lake view, and golf course. He launched a postcard campaign that gave home owners an Apple Valley State of the Market Report, he advertised in the community's monthly newspaper, and he snapped up a memorable URL, www.applevalleyohio.com. The year after developing his niche, his team's sales total climbed to 322. The next year, it surpassed his sale-a-day goal, with 380 transactions.
Miller hasn't been immune to the market slowdown-sales volume dropped in 2007 and fell even more in 2008-but he feels it would have been much worse if not for his specialty. If I hadn't developed this niche, during the slowdown I would have had to let people go, he says. Now that the market is turning around, I'm not spending my time and energy training new people. I'm out listing and selling homes.
Being Nimble Pays
For all the real estate practitioners and sales coaches who insist that having a well-defined niche is the best path to success, there are some who argue against it, saying it's better to be well-versed in a number of areas so that you can quickly adjust to market changes. Some practitioners go so far as to maintain multiple Web sites and blogs, each geared to its own niche. And others prefer to have no specialty at all.
My niche is constantly changing, which I guess makes me a generalist, says Emily Sachs Wong, perennially one of the top salespeople at Koenig & Strey GMAC Real Estate in Chicago. When I sell a $500,000 condo, I get a bunch of referrals for that type of property. When I sell a $2 million house, I seem to have a lot of $2 million buyers.
In Miami Beach, Fla., Mark Zilbert also rolls with market changes. The owner of Zilbert Realty Group says he favors a niche lite approach, switching gears often to fulfill the hottest pockets of buyer and seller demand. If you had talked to me two years ago, I would have said my main niche is high-end waterfront real estate, he says. Now, a significant share of his business comes from short sales. I'm always planning six months ahead for what I think is next.
Whether you choose to specialize or you prefer a more flexible approach like the one Zilbert takes, you must possess a love for your work. That, more than anything, is what shines through to buyers and sellers. Do what you enjoy doing; otherwise it's not worth doing at all, Gestson says.
5 Ways to Find Your Niche
Analyze local demographics. Probe U.S. Census data to spot demographic trends-a surge of baby boomers in your area, for example-and pay special attention to underserved groups, says Josh Gonzalez, director of Realty Executives International's Latin Division, which helps provide trustworthy service to Latinos. The largest portion of Hispanics are of Mexican descent, but it's not a homogenous group. But be careful, says Gonzalez, when working with large demographic groups that you don't alienate any one subgroup.
Pinpoint your passion. What do you know and love? For Cookie Boyd, ABR®, e-PRO, it's golf. The former golf pro is now a salesperson with John R. Wood, REALTORS®, in Naples, Fla., where he specializes in finding buyers homes on golf courses that match their skill level. The idea stemmed from a conversation he overheard in the clubhouse; a man with meager golfing ability was complaining that the course near his home was too difficult. Do you want to live on a golf course where you're always frustrated? says Boyd, who observes clients playing golf before showing them homes. If you hate the golf course, you're a prisoner.
Zero in on a defined geographic area. In a large city, such as New York, you can take that to an extreme. Real estate broker David Michonski, CIPS, of Coldwell Banker Hunt Kennedy in Manhattan, has salespeople who are the expert on a particular condo building-knowing every seller in that building, knowing the color of the dog's eyes, knowing the children's names, he says. Every seller wants to know one thing: 'What have you ever sold that's like my property?'
Look right in front of you. Art Reed, CRS®, SRES, broker-associate at Huff Realty in Florence, Ky., suggests reviewing clientele from the past few years to identify emerging patterns. A few years ago I was more of a generalist, Reed says. Then I saw that I was working with more seniors. Melanie McLane tells a similar story. In the 1990s, she realized many of her very first clients from the 1970s had become seniors. I had this 'duh' moment, says McLane, ABR®, CRS®, a real estate trainer, broker, and appraiser based in Jersey Shore, Pa. Because I had kept in touch with them, there was my market.
Tap your existing networks. Look at the organizations you belong to in a new way. Heavily involved in the parent-teacher association? You can endear yourself to parents, other PTA members, and staff, says Julie Escobar, director of corporate marketing for ProspectsPlus!, a Bradenton, Fla., real estate training company. One school might have 2,000 kids in it-you can really take that a long way.
Get the credentials. Designations and certifications give you specialized knowledge and boost your credibility. Just be sure that when marketing yourself, you explain what those little letters after your name really mean. Also, if you have past experience or non-real estate training that puts you in tune with your clients' needs, don't be shy about telling people. For example, a buyer of a waterfront property might appreciate that you're a former sailing instructor.
Understand the lifestyle. Delivering excellent service requires that you understand your customers' attitudes, tastes, and motivations, says Laurie Moore-Moore, founder of The Institute for Luxury Home Marketing in Dallas. Buyers and sellers in the luxury market often include business owners and executives who are used to seeing the numbers to back up their purchasing decisions. They expect you to know the numbers cold, she says. If you can demonstrate that you do, it's amazing how quickly you can build your business in the luxury segment.
Share their enthusiasm. Specialize in environmentally friendly homes? Use recycled paper for your print marketing materials and write on your blog about green housing trends. Marketing to cycling enthusiasts? Participate in a race. You can also attend conferences and community gatherings related to your niche, suggests Gary Gestson of Long & Foster Real Estate Inc. in Gaithersburg, Md. If you want to sell historic homes and find historic buyers, you have to hang out where they do.
Become an online resource. Successful niche marketers say the Internet is one of their best tools for reaching out to customers. Buy a memorable Web site address that speaks to your niche, and use your site to provide a range of information that would be useful for your buyers and sellers. Specialize in urban condos? Perhaps you can provide links to local public transportation schedules and information on walkable communities. Start a blog to share news and insights that your customers will value.
The Fair Housing Conundrum
If you're creating a niche marketing plan around a specific buyer or seller demographic, be careful not to run afoul of the law.
The Fair Housing Act says it's illegal to advertise or make any statement that indicates a limitation or preference based on race, color, national origin, religion, sex, familial status, or handicap. That means you can't focus your business plan or advertising tactics only on Hispanics or Arab Americans and exclude African Americans, Asians, or Caucasians, for example. Likewise, you can't market your services only in Christian-oriented publications, even if you'd prefer to target only those who want a Christian salesperson.
The best rule we give is this: Describe your skills and the property, not the people that you want to live there or the people that live there now, says Nancy Haynes, executive director of the Fair Housing Center of Western Michigan.
Indeed, there's nothing wrong with marketing yourself as having certain language skills-so long as you pitch your services to the population at large, not just to those ethnic groups who speak that language. Then prospects can decide to choose you because you share a similar background-but you're not choosing them based on some similarity they have with you.
There are other strategies you legally can use under the Fair Housing Act. First, you're usually on safe ground if you focus on a property-related niche instead of a client-related one. Some examples: fixer-uppers, condominiums, resort housing, foreclosures, eco-friendly homes, golf course communities, and historic properties.
Second, you can focus on specific needs that aren't covered by fair housing, such as relocation, an interest in living near a particular hobby or sports offering, and the level of understanding about the buying and selling process (just be sure you don't make assumptions about the likelihood of any group being first-timers).
It's possible to follow the advice of the marketing gurus and target a niche without violating the Fair Housing Act. But be inclusive in your marketing, allowing prospective clients to choose whether they want you to represent them. For more information, visit REALTOR.org/fairhousing or www.hud.gov.
Designate Yourself a Specialist
The NATIONAL ASSOCIATION OF REALTORS® and its affiliates offer more than 20 designations and certifications for specialties ranging from second-home sales to working with seniors. Here's a sampling:
ABR® Accredited Buyer Representative http://rebac.net
ALC Accredited Land Consultant www.rliland.com
At Home With Diversity REALTOR.org/diversity
CCIM Certified Commercial Investment Member www.ccim.com
CIPS Certified International Property Specialist REALTOR.org/international
CPM® Certified Property Manager www.irem.org
CRS® Certified Residential Specialist www.crs.com
e-PRO® Internet Professionalism www.epronar.com
GRI Graduate REALTOR® Institute REALTOR.org/GRI
RSPS Resort & Second Home Specialist REALTOR.org/resorts
SIOR Society of Industrial and Office REALTORS® www.sior.com
SRES Seniors Real Estate Specialist www.seniorsrealestate.com
Wendy Cole is a senior editor of REALTOR® magazine. She can be contacted at email@example.com.