THE NUMBERS GAME

What are your odds? And what are our assumptions? Let’s talk odds first.

Like most development staff, you’re already juggling multiple funding sources, so you prioritize your effort based on ROI, right? Well consider these numbers.

MATH ALERT!!!

  • Let’s assume that 1 in 20 households (5%) will choose a broker for a home purchase or home sale each year*.
  • And let’s assume that each of those transactions generates $1,300 of unrestricted funding, assuming a typical transaction with typical commission rates for a $300,000 home. (How referral fees work will be the topic of a future post.)
  • Let’s say you have 5,000 supporters.

    5,000 x 5%= 250 annual transactions

  • 250 x $1,300 per transaction= $325,000
  • And that $325,000 doesn’t cost your supporters a penny!

That’s a blue-sky scenario. So, think about getting only 1% of the annual transactions the first year and using those stories to increase awareness among your supporters. Even if you capture only two transactions and get $2,600, for the amount of time invested, that’s not a bad ROI. We expect that as your supporters continue to hear about this, your IIC funding will grow each year.

OK, so how did we arrive at our assumptions and what data did we use?

*How did we come up with the 1 in 20 statistic?

  • 5.51 million existing homes were sold in 2017, according to the National Association of REALTORS®.
  • We think most home sales have a buyer’s agent and a seller’s agent. So we multiplied the number of existing home sales by 2 = 11,020,000 buyers/sellers
  • 612,000 newly constructed homes were sold in 2017, according to the National Association of REALTORS®. We think new homes sales usually involve just a buyer’s agent.
  • 11,020,000 + 612,000 = 11,632,000 total possible buyers/sellers
  • The total number of adults in the US is 128,900,00.
  • To find out what percentage of the adult population will buy or sell a house each year, divide the total number of buyers and sellers by the total number of adults. 128,900,000= .09 or 9%
  • 9/100 = 1.8/20
  • To be conservative we cut that nearly in half,to 1/20.

Easy peazy. You have lots of supporters and some of them are going to need a real estate broker. Each one of them is an opportunity for you to get a $1,300 donation that costs your supporter nothing!

Call Now!