The Importance Of Referrals

As a real estate professional, there are many different ways that you can gain new business. You can use marketing tools, strategies, techniques, and you can farm a specific demographic or geographic area. You can also network and publicize your services via social media channels and websites. Repeat clients can return to you for help in selling and buying properties, which generates incremental business.


Referrals are another important avenue for growing real estate business. Real estate referrals can come from current and past clients and from colleagues, friends, family, and suppliers. In fact, according to National Association of REALTORS® (NAR) statistics published in May 2020, 39% of sellers who used a real estate agent found their agents through a referral by friends or family, and 27% used the agent they previously worked with to buy or sell a home.


Business that comes your way via referral is valuable in for many reasons. Referral business usually takes less time and fewer marketing resources on your part to acquire. You don’t have to expend effort and money to compile mailing lists, develop print and digital pieces, or cover mailing costs. Referral business often yields motivated buyers and sellers, which means the increased likelihood of completed transactions. Additionally, clients referred to you by a third party may be more inclined to trust you and your real estate expertise, which can lead to positive interactions and results.

Referral business can also provide important reinforcement and encouragement that you’re doing a good job. When someone takes the initiative to refer your services, they are giving you the highest professional compliment.  

Results of Real Estate Referrals

With so many benefits, you may be wondering how you can increase referral business. Here are five tips: 

  1. Ask for it.  Tell current and past clients that you’ve enjoyed working with them so much that you’d appreciate them recommending your services to their friends and family. Let colleagues, family members, and your real estate partners know that you’re eager to accept referrals as well. 
  2. Stay in touch.  Continuing to communicate with past clients can help build relationships and keep your name on their minds. If they’ve heard from you recently, previous clients may be more likely to refer you to someone they know. 
  3. Be social.  Ask for referrals on your social media channels, and socialize often by attending networking events. The more people you meet, the more chances you’ll have for referrals. 
  4. Go the extra mile.  Build a reputation for service excellence by going above and beyond for your clients. When clients believe they’ve received exceptional service, they are more likely to recommend you to others. 
  5. Show clients that you care. To build the kind of long-term relationships that lead to referrals, it’s important to show clients that you care about them beyond the closing table. By adding American Home Shield® home warranties to every transaction, you’ll give your clients valuable reassurance about their purchase decision and important budget protection. In addition to receiving special Real Estate Edition pricing, your clients receive coverage for the repair or replacement of major parts and components of many home systems and appliances that break down over time due to normal wear and tear. They’ll appreciate the added protection and the extra service you’ve provided to them.

To discover more about fostering solid client relationships, gaining referrals, and building business, contact your local American Home Shield Account Manager today. 

AHS assumes no responsibility, and specifically disclaims all liability, for your use of any and all information contained herein.

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