“20 Minutes of Successful Niche Secrets – EPISODE 55,”
Where I help Eric Herrera choose a Niche and figure out where to begin as a new Real Estate Agent
Glenn: Hi! It’s Glenn McQueenie, and welcome to my 25-Minute Success Series Podcast. This is my weekly podcast where we talk about helping people find their niche market, because I really think that the future of real estate is all about just getting into your niche market. I mean, let’s be honest. I know just in Toronto, we have over 55,000 realtors chasing about 100,000 sales. So I don’t think we need any more realtors, but we do need a lot more great realtors who can add more value to their customers. And I’ve found a way that they can do that is by focusing on one single market, and going really deep and really discovering the intricacies of their niche market instead of being the “I’m everything to everyone” realtor. So today, we have a special guest, Eric Herrera. How are you doing, Eric?
Eric: Hey, Glenn. I’m doing great.
Glenn: Good! And welcome to my podcast! So Eric is a new agent. He is just getting his license right now, and in the process of picking the brokerage he’s going to work for. So he’s like the newest of the new right now. So Eric, why don’t you tell us a little bit about yourself?
Eric: Sure. So I got interested in real estate about two years ago. I was working concierge at a condo, and before that I had a lot of customer service experience in the food and drink industry, retail, and really just around eight years of customer service experience in that. When I was working at the condo, I would see agents coming in and out every day, and I would see them with their clients, and I would hear them interacting and what not. So I said to myself, “That’s something I could see myself doing.” And like you mentioned, there are a lot of agents in the city of Toronto, right? That’s something you hear every day, that it’s over-saturated and what not. But from what I’ve seen, there aren’t enough quality agents out there. And I know how my work ethic is, and I know how I like to over-exceed other people’s expectations. So I said, “This is something I could get into, and I could be successful and not just be another statistic.” So I started right away. I enrolled, and here I am today.
Glenn: I think that’s such a great story, that even being a concierge, you could notice that the agents that were coming in, some of them were really amazing, and some of them were just brutal.
Eric: Yeah, 100%.
Glenn: Wow. Interesting. One of the ways that we talk about niche markets is, it’s really about who you are, and just bringing you and all your natural strengths and unique abilities to a marketplace of people who are similar to you. It’s almost like we’re matching up your values and your mindsets to the market. So if I had to ask you to paint a picture, what would a dream-come-true client or a perfect client look like? How old are they? What’s their problem that you want to solve for them? Can you just paint that picture for me, Eric?
Eric: Sure. Yeah, I’ve been back and forth with this, because I’m trying to be conservative. Something I hear a lot when I speak to people is, “You should start with people your own age, and maybe at a brokerage downtown, and the condo market,” right? Young professionals. People closer to my own age. But honestly, I do have a passion for luxury real estate. I love luxury homes. Obviously luxury condos as well. So that’s something I am leaning towards. I am looking for a brokerage that is prominent and established in the luxury market. So that’s what I’m leaning towards right now – just the luxury market.
Glenn: So what’s important about the luxury market to you?
Eric: I’m just passionate about it. I don’t know. I like it. I just see myself always looking it up and researching it more, I suppose. I think it’s just more fun for me.
Glenn: Do you have a lot of connections into that market right now? The reason I ask is, what I know about luxury – and in my career, I’ve sold a lot of luxury properties – is it’s a very connected, referral-based market. It’s almost like any high-end professional service. They’re not advertising. Usually, it’s all word of mouth. So what’s your connection to that industry?
Eric: Absolutely no connection. My thought process around it was just joining a team that is established and getting exposure there.
Glenn: And do you want to be on a team for your career? Or do you want to build your own team?
Eric: No. Yeah, just to start. Just to get some in-field experience, shadowing agents, or just being exposed, right? Holding Open Houses for people and just really getting in-field experience.
Eric: And to feel comfortable enough, or feel like I can hold my own out there, and just go it on my own.
Glenn: So I think another way to look at teams is it’s not binary, right? It’s not like you’re on a team or you’re not on a team. There are actually a lot of different models for being on teams, and I’ve coached probably a lot of the top Toronto real estate teams in my career. So let me just give you the lay of the land right now. We have a lot of agents who want to start and want to get the benefit of being on a team, because they usually will generate the leads. And then they’ll want to go and get their experience and then go open their own brokerage or just build their own team or build their own brand. And then on the other side, you have teams that are trying to build a team, and you’ll notice that what they used to do was they used to take a lot of people on their team (especially if they had a lot of leads), and they would just dish those leads out. But what they started to notice was that people would come on their team, steal all their systems, leave their team, and go and do it themselves.
Glenn: So a lot of the teams you’re seeing now are shying away from people who want to start with them and then move on. They’re looking for people who want to be on a team for a long time, because most agents, (I would argue probably 70-80%, maybe even 90% of the agents right now) do not have a great ability to generate their own leads. And the person who generates the leads – they have the gold. We call them the “rainmaker.” It’s a weird time right now in this market, because a lot of these teams are going, “Yeah, I’m not doing that anymore. I’m not bringing people on, taking my systems, and then they’re going.” So you’re seeing this modification happening right now, and I call it the “dating team system,” which is, you’re building your own brand, but you’re also talking to some teams right now and saying, “Hey, if you have an overflow of leads, or if you need somebody to step in and take your stuff, then I will do it.” The big challenge with being new is, you don’t know anything, right? So the problem is, if they get a great lead, they’re not giving it to you. This is a bit of a joke of the industry. “Oh, I’m going to the team for great leads.” It’s like, “Listen. If I’m running a team, and you’re brand new, I’m not giving you my clients right now.” So we have the one team model, which is, yes, go find a team at a luxury brokerage – although I do believe, if you actually look at the market share stats of who sells luxury, there isn’t any real luxury brokerage in Toronto.
Glenn: Most of the luxury market is being served by most of the Brokers. I don’t think anybody’s really got that covered. But what I would tell you is, if I was you right now – how old are you, Eric?
Glenn: 24. I started when I was 23, so you’re a year older than me in the business. If I was talking to my 24-year-old self right now, I would probably focus all of your efforts on luxury rentals – not on luxury condos and sales, because the luxury condos and sales is a very finicky market, right? It’s a professional market, which is great. These people have usually made a lot of money, and the reason they’ve made a lot of money is they’re really good at making decisions and building a professional team around them. And if you’re just newly licensed and going to get a luxury listing, a lot of times it’ll just be a little tricky, because a lot of them just expect a very, very high standard. They’re used to paying their lawyers $1,000 an hour and their accountants a lot of money to provide the professional services to them. But, on the other end, it is a real task for anybody who is moving to Toronto right now, (or moving to any big city) to find short-term accommodation, or find rental accommodation before they go and buy. And the beautiful thing is, Toronto is one of few markets where a lot of the rentals actually go on MLS (most of them aren’t). It creates a really great opportunity for you to position yourself as the luxury rental expert. And through being the luxury rental expert, you get to see every single building in Toronto. You get to know all the product. This is the combination of you bringing your skills to knowing the products – because otherwise, what’s the value? If a client’s saying to you, “Hey Eric, what do you think about this building?” and you’re like, “Yeah, no idea,” it just doesn’t make any sense, right?
Glenn: They don’t see the value. But when you’re in the rental world, it’s a beautiful way. And a lot of luxury rentals are probably $5,000 – $10,000 a month, right?
Glenn: Maybe more. But a lot of that sweet spot of the market seems to be around $5,000 – $10,000. So what do you think about that?
Eric: Yeah, it’s a great idea. I didn’t even think about that. And on top of that, too, I’m building a database with that clientele, right?
Glenn: Well that’s it! And you’re learning on the job. My experience is that everyone who you help find a rental for loves you, because they’re not paying you. You’re getting paid by the listing broker on this, so it’s almost perceived as a free service to them. You’re going to bat for them, and going to tell them and showing them all the rentals. Plus, you also have access to what all the rentals recently rented for if they were on MLS, so you can really give that professional advice to them and say, “Hey, listen. These people asked for $6,000, but the last two units were rented for $5,200, so let’s go and pay that.” And that’s when you start adding value to your customers.
Eric: Mhmm. Absolutely.
Glenn: And here’s the other thing I’ve learned. When people are actually moving to Toronto in a professional capacity, a lot of them, if they’re not familiar with Toronto, will not buy first. They will always rent for a year or two, just to figure out the lay of the land. We’ve got 146 neighbourhoods in Toronto, and they’ll probably focus on the top three. So a lot of times, you’ll be able to get them in there, put them in for a year, and then within about six or eight months, they’ll be like, “Okay. Hey Eric, we’re ready to start buying now.”
Eric: Mhmm. Yeah, that’s a great strategy, for sure. Especially, like you said, what we were speaking about before was that I don’t have the connections. I don’t have the database or the lists of people that I’ve serviced or that know me, and they’re in that market. So that’s a phenomenal way to build that.
Glenn: Yeah! And it’s kind of like your entry point of service into that community.
Eric: Mhmm. Yeah.
Glenn: And the beautiful thing is, guess who their friends are?
Eric: Yeah. Other people like them, right?
Glenn: Right. So your first game would be, what kind of platform could you create that would basically draw the leads to you before it gets to other agents? So imagine there’s a lake of leads – a lake of people thinking about renting in Toronto right now. Their problem is they’ve got to find something. They’re being transferred here. They’re moving here. And there might be a bunch of people who’ve got MLS rentals for sale, so those people in the lake are actually going directly to those people who’ve got the listings, right? So what we have to do is we have to go upstream. We have to get up the river before the person gets into the lake, and try to catch them up there.
Eric: I see.
Glenn: The way you catch them up there is you start giving them really good offers. You could offer a free list of the Top 10 Rentals in Toronto between $5,000 and $7,000. Who would want that list?
Eric: Yeah, absolutely.
Glenn: Right. And then you can segment it, too. You could almost have three or four different Facebook pages, or even using Instagram: “Top 10 Rentals,” “Luxury Rentals Between $5,000 and $7,000,” “Yorkville Luxury Rentals.” You could have “Bay Street Luxury Rentals.” You could have “Wellington Luxury Rentals.” You can segment your market, because let’s face it – a luxury rental is either going to be a condo downtown, or it’s going to be in some of the areas that are within a 15-minute drive to downtown Toronto. There are people listening to this call that have no idea what Toronto is, but if you could go to any city, the professionals are all going to be commuting 15 to 20 minutes, if they can, down to their great jobs (which are all, in Toronto at least, in the downtown core).
Glenn: And then you can segment it even further, because you could do luxury condos, you could do luxury townhouses, you could do luxury townhouses at Avenue Road and St. Clair. You could do luxury homes in great neighbourhoods in Forest Hill or Rosedale or Leaside or Lawrence Park. No one goes, “I just need a rental in Toronto.” The real future of real estate is people going, “I want to get a luxury condo in Yorkville.” They don’t go just Toronto. Does that make sense?
Eric: Yes, that does.
Glenn: Yeah. So now what we have to do is strategize. First of all, you have to select a single target market, right? Yours is going to be luxury rentals. Then somehow, we’ve got to figure out a way for them to put their hand up when they’re ready and say, “Hey, I want what you’re offering.” And that’s why we do the Instagram or the Facebook business pages. Are you familiar with Facebook business pages?
Eric: Yes, I am.
Glenn: Okay. And then there’s a second part of this which would be really, really interesting. This is where we start to create your own MLS system. What you start doing is you start marketing to people who actually have luxury rentals and they’re trying to find a tenant.
Glenn: So imagine it’s a year from now, and you’ve got 20 or 30 people who’ve got luxury rentals that you’re filling their places for, but you’ve also got a stream of maybe 30 or 40 people looking. We can now start cross-marketing them back, and almost avoiding the MLS right away, which means you get all of the rent – not just half of it.
Eric: Oh, I see what you’re saying. I see what you mean.
Glenn: We would mail into buildings where we know there’s a lot of luxury rentals, or we would Facebook target ad (or whatever we’re going to do), to say, “We currently have 10 families moving to Toronto who are looking for a rental property between $5,000 and $10,000. If you don’t want the muss and fuss of putting your property on the MLS, give me a call. All inquiries will be kept confidential.” And this way, you start to triangulate. So it’s you, the renter, and the landlord, and you’re the one who positions yourself at the middle.
Eric: I see. So that could be one of those mail flyers?
Glenn: Yeah, you can. The only problem with mail flyers is, if you’ve worked at a concierge in a condo building before, you’ll notice that the real estate flyers all come on the same day. So then the consumer goes to their mailbox and finds 15 real estate flyers and turns around and throws them all in the blue box. So I don’t think it’s that effective right now doing print, and it’s also very expensive. And, I would argue, fairly unpredictable with our postal system right now, on whether it’s going to go out or not.
Glenn: You could also do Facebook targeted ads, where you are targeting by postal code, by building, only that ad to show in front of those people. It’s a great approach. The other way you can do it is go through Kijiji or Craigslist. It’s not that anyone really goes to Kijiji or Craigslist to look anything up – it’s just when they Google what they’re looking for, because Kijiji has such great content and it’s relevant and it’s new, Google picks it up and usually puts it on the first page.
Eric: Got you.
Glenn: So now you can start doing it. And then you can also target Montreal. There are a lot of people moving from Montreal to Toronto. You could do research. “Where are most of the professionals moving to in coming to Toronto?” I’ve got to tell you that right now, from across Canada, this is the place to be to launch your professional career in most cases, to move up to the highest point.
Glenn: Get out of being head of your region, into head of the national, right? And we’re also a big international place.
Glenn: So then, here’s the third place that I would probably tell you to target. I’ll guarantee that all of the big companies in Toronto are working very hard every day to find great talent to fill their ranks. Right now, there’s just a big war for talent out there. Only maybe 10% or 15% of the population is truly the top talent. It might even be 5%.
Glenn: And every time they’re trying to recruit somebody, there are two sales that have to occur. One, they have to sell them on the job. Number two is they have to sell them on the city. You could position yourself by talking to some of the top companies in Toronto and saying, “Listen. My job is to sell the city. So anybody who you’re interviewing, if you want me – and I’ll do it free of charge – I’ll take them out for an hour or two and I’ll show them some condos and I’ll sell them the city. That’s what my job is and that’s what my service is going to be to you. And in return, I would just want any of your corporate relocations to contact me, and then I’ll help them find their places.”
Eric: Wow. Yeah. That’s fantastic. Because again, it’s like you’re providing a value to these companies, and they’re reciprocating with clients, right?
Eric: Put the value first.
Glenn: Absolutely. It’s always value first. And this is the missing link that most agents miss. They think that the other people have to commit to them first or sign a Buyer Agency Agreement first, or that they have to do something before the agent ever does anything. And I’m like, “No. You’ve got it backwards. It’s your job to service those clients and come from contribution without expectation, and just serve, serve, serve. Give, give give.” And what I’ve learned in my 29 years in real estate is that’s exactly the right mindset to have if you want to build a really big business.
Eric: Absolutely. And just that route, too, of finding these entities that have clients that need service, and going straight to them, when probably not a lot of people do that, right?
Glenn: Absolutely. Nobody does that to them. What if you were to reach out and say, “Hey, listen. This is the service that I’m willing to provide for you.” And I’m telling you, I used to do this earlier in my career, and I also did it when I worked for the Blue Jays for four or five years. Almost the whole team, I had to sell the players on the city, also. But they have a lot of options to come to, and my job was to sell the city. There, it’s to sell the team. So I’m saying this from experience, that it’s not just the hiring person who’s making this decision – it’s their family who’s coming with them. If you don’t sell the family, you’re not getting that recruit.
Glenn: So I think if you were to do those three different options right now, I would say your marketing platform would be like, “Okay. I’m going to market for renters, but I’m going to go upstream because I don’t have any luxury listings right now. So I’m going to start doing offers, like the ‘Top 10 Best Luxury Rentals.’” And you don’t have to post what the Top 10 are. You just have to say, “Would you like a list?” And then if someone says, “Yeah, I want the list,” then you say, “Well, I want to just make sure I send you the right list, so where’s the perfect location? What does the perfect home look like?
Perfect price range? Perfect time frame?” And if you know those four pieces of information, you can easily jump on MLS and pick your Top 10 list, right?
Eric: Got you. Yes.
Glenn: And then what you could do is, if you get really good at this, you could start helping people buy luxury condos. You already have the renters, and you’ll property manage them. So now you start building four platforms, right? You get the renters, you get the landlords to match the renters with, you get the relocation, and more importantly, you get the investors now, who are like, “Yeah, I’ll buy it, but I want to make sure I’m going to get the right people in it.” And it doesn’t just have to be a house or a condo. It could be a fourplex, because you’ll make way more money if you buy a $2,000,000 fourplex right now. You’ll probably get $16,000 a month in rent from those four units. If you buy a $2,000,000 condo, you’ll be lucky to get probably $10,000.
Glenn: So it’s a better return for them.
Glenn: So what do you think? Do you think that’ll work?
Eric: Yeah, I think that’s a great idea. It’s fresh. I feel like these strategies aren’t used much in all of the other lead-generating, typical stuff you hear. This is just great because it’s targeting the market that I want to work with – that niche – instead of just going out there and scrambling.
Eric: Yeah, it’s fantastic.
Glenn: See, that’s why niche marketing works. Once you tell me what you’re looking for, you can customize a strategy to go after it, and it’ll actually work, whereas I think a lot of the other people are teaching, “Oh, you’ve got to lead generate.” You scatter. It’s shotgun blast. “Go after everything.” And it’s like, “No. It’s not predictable. Everyone else is doing it. It makes no sense.” It’s absolutely stupid, so why are people even teaching that anymore? The real truth is that someone is lying awake right now in Montreal, who just got news that they’re getting transferred, and they’ve got to be in Toronto by July 1st. They’re going to go online with their Ipad in their bed, and they’re going to start looking for properties. And that’s their selfish problem.
Glenn: So if you have the selfish solution that absolutely matches their selfish problem, there’s no reason why there can’t be a match in the marketplace, and they contact you and say, “It looks like you know what you’re doing.”
Eric: Mhmm. Absolutely. Especially with the presence, right? That’s why it’s important to have that Facebook page and have content on it, and Instagram, like you said.
Glenn: Yeah, absolutely! And then what you can do is start creating content that just targets those people, like the Condo Rental Report for Toronto. You can start actually creating content that positions you as an expert anyway.
Glenn: “Here’s the current one bedroom luxury condo rental average price.” “Here’s the two bedroom.” “Here’s the three.” “Here’s the one bedroom in Yorkville.” “Here’s the one bedroom on Bay Street.” It’s a bit of data. I wouldn’t tell you to go and do that all right now – but that’s the content. I’m in Montreal and I find out that you’re serving the marketplace, and you’re reporting the averages. Then I automatically think you’re the expert on this, and I will contact you.
Eric: Mhmm. Absolutely. Especially if it’s up to date and consistent, right?
Glenn: It’s all content marketing now. People are still trying to do other content like print content, and I’m like, “Hmm. I think it’s probably more web content you need right now, because that’s where the market is.” No one’s at home right now going, “I can’t wait. I hope eight agents send me a flyer this weekend. I just hope.”
Glenn: People don’t think that way, right? Here’s the other hack that I’m going to give you – my final hack. I used to do this when I was showing. I would always bring bottles of wine for the concierge of condos. When I was showing those places consistently, and I got to know all of them, I would always bring them a bottle of wine, lunch, a coffee, anything, just to say, “Thank you so much. I really appreciate you.” And it’s pretty amazing how most concierge really appreciate that, because you’re treating them as a human being. And the concierge always knows who’s moving in the building.
Glenn: So maybe that’s a fifth idea. I know we’ve got to wrap up, but here’s the fifth idea I’m going to give you, because I just thought about it. What if you got a concierge Mastermind cocktail group that met the fourth Thursday of every month for beers, and you talked about developments in the concierge world? But more importantly, you’re setting up a network of people and ears and eyes on the ground that will be sending you leads all the time.
Eric: Mhmm. Having the concierge know who I am, know what I do, and like me, because people come to the building all the time. Is that what you’re referring to? When people come to the building, they’re like, “Hey, do you know an agent that works here a lot?” And then they’re like, “Yeah, Eric is the guy.”
Glenn: Absolutely! And you thank them with a great dinner and you make the big deal out of them, and you just show them how much you really appreciate them. I think that’s a great way. Plus, you’ll also have some sellers who will come down and say, “Oh, I need the elevator because I’m going to be moving soon and I’m just getting some de-cluttering out.” So now we can start matching those people. So create Toronto’s Concierge Network! And I think you have to give to them at the same level you’re expecting them to give back to you.
Glenn: How fun is that!?
Eric: Yeah. No, it’s exciting!
Glenn: Alright Eric, do you have any other questions, or are we good to go?
Eric: Yeah, that was super informative. It’s great, because I’m sure you know that new agents are always scrambling all over the place with their thought processes and where they want to start. The struggle that I’ve been having recently was that I have a desire for a certain market, but I’ve asked other experienced agents that I have access to, and they’re giving me their advice, but it’s not synced up with what I’m excited about. And I’m sure it’s valid, because they know, right? They’re actually in the field. They see what’s happening. And I’m not. I don’t see what’s happening, and I don’t see what makes more sense to start with. But I just had a desire for this market. This is what I was really looking for, was advice and tips to get started there, as opposed to running around in circles and hopefully moving towards the market I really want to work with.
Glenn: Absolutely. Well that’s why you need a coach to mentor. That’s what coaching and mentoring is, right? They look at the marketplace and they bring it back to you, whereas many agents are just living their life and their experience. So they’re getting two eyes on it, instead of like 100 eyes on the situation. That’s why I always say to agents – because they’ll tell me they’re going to pick the cheapest brokerage or something to work with – “You don’t need that. You don’t need cheap right now, because $300 a deal is nothing if you’re not making any deals.” Do you know what I mean?
Glenn: You could have the best split in the world, but it’s not making any money. And you know what? The thing is, the clock’s ticking for all new agents, whether they know it or not. You’ve got three, six, or 12 months to try to make this go. And if you don’t, then you’re out, and nobody cares. “Thanks for your $5,000.” There are another 500 people coming in every month, so who cares? And that’s the difference between getting coaching and mentoring, and just finding out what other agents are thinking about. The other thing, too, is it’s not about the brokerage. People don’t even care what brokerage you’re at. Some people, maybe in the luxury segment, might think about it, but if you go onto the Toronto Real Estate Board and you actually start looking at the market share, there’s more luxury homes sold by non-luxury brokerages than there are from luxury brokerages.
Glenn: So it doesn’t matter. You’ve got to pick whoever’s going to be the manager or the broker or the team leader, or who’s going to be the coach. That’s the most important thing for you. Alright, we’re at 30 minutes. I promised 25. So Eric, thank you so much!
Eric: Thanks Glenn! I appreciate it.
Glenn: And thank you for joining me on the call, alright?
Eric: Thanks Glenn!
Glenn: Okay, take care. Bye bye!