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Real Estate Agent Niche Analysis
Hyper-Local Market Research & Competition Analysis for Real Estate Agents
The most important goal of Real Estate Agent Niche Analysis is to better understand your target market, down to a hyper-local level.
Since this is a common Admin VA Task we’ve handled many times over the years at REVAS, we’ve re-invented & systematized Agent Niche Analysis based around 7 Key Data Points including:
- How many Total Properties are in your target neighborhood(s) / Zip Code(s)?
- What is the Total Approximate Aggregate Value of all properties in your target niche?
- What is the Annual Transaction Volume occurring in your target niche each year (by Sides and by Sales Volume)?
- Therefore, what is the Average Annual Turnover in your target niche?
- Who are the Top Producing Agents already dominating your target niche(s)?
- What total sales volume and Gross Commissionable Income (GCI) are those top producers closing & earning?
- What Market Share Percentage do those Top Producers already represent?
In essence, the goal of this approach with your Real Estate Virtual Assistant is to determine the exact amount of business that’s conducted in your target niche, including the number of transactions occurring each year, and an actual dollar amount for the total sales volume.
This makes it much easier to calculate the realistic income potential of setting & achieving your annual sales goals…
… Including understanding how competitive you’ll need to be, potentially stealing market share from the preeminent top producers already dominating the same niche.
How It Works:
Real Estate Agent Niche Analysis requires your Virtual Assistant to look up several key datapoints about your local target market(s).
We built our Niche Analysis model around the 7 Key Data Points mentioned above, so for the sake of this article, we will imagine you’re doing the same.
Therefore, the main task for your VA is gathering the key details about all existing properties and recent transactions in your target area using both Public Records & either your local MLS or other Real Estate Data sources.
From there the Virtual Assistant can organize and clean the data, following the Standard Operating Procedure (SOP) you’ve created for how you’d the Virtual Assistant to be formatting the final product.
The end result should a comprehensive Niche Analysis Report to ideally include all 7 Key Data Points in an easy-to-digest format, so you can quickly scan and understand:
- Total Properties,
- Total Approximate Aggregate Value,
- Annual Transaction Volume (by Sides and by Sales Volume),
- Average Annual Turnover,
- Top Producing Agents,
- Gross Commissionable Income (GCI) earned by those Top Producers, and
- Market Share Percentage the Top Producers currently represent.
The greatest value of Real Estate Agent Niche Analysis is that you probably wouldn’t put aside the necessary time and resources to do this yourself.
It would be a painstakingly manual process to try to do it in-house.
Building a step-by-step SOP so you can outsource this to an Overseas VA will be reducing the time you need to invest by 99%.
The other big value out of using a Virtual Assistant to conduct Agent Niche Analysis is now you can work backward to determine your own realistic objectives:
- What is your income goal?
- Where are you going to be targeting for your RE business to reach that goal?
- What percentage of the actual sales volume in those target markets are you going to need to hit to be able to achieve our income goal?
- Who else is out there competing against you for the same income & how feasible is it for you to actually beat them in that competition & hit your income goals?
With Agent Niche Analysis this is the best way to learn these competitive advantages.
The biggest con of this service is that it still only tells you about some really specific areas.
Due to the amount of data you’ll be covering, we recommend to focus in & complete the Niche Analysis Report for only one zip code at a time.
Plus, unless you want a huge report of all the Agents that did fewer than 10 transactions in the prior 12 months, you’ll most likely be drilling down on only 2 or 3 (sometimes maybe 4 or 5) Top Producers in the area.
You’ll still know the total sales volume for the zip code & therefore the potential Gross Commissionable Income for the zip code, but you won’t necessarily know how that’s broken up among the Agents there, & you’re still going to have to do a little more research to make sense of that data with the boots on the ground approach.
Agent Niche Analysis will depend a lot on how deep of a dive you want your Virtual Assistant to go.
Assuming you’ll build your model around the same 7 Key Data Points referenced throughout this article, we recommend to budget for about:
- 1 – 3 Hours to Build Your SOP
- 10 – 20 Work Hours Per Zip Code (Overseas VA)
Of course, trying to estimate the price by Zip Code can be tricky, since ultimately the numbers will reflect the population:
Some Zip Codes only have a few thousand residents…
… While the highest population Zip Code at time of writing (2022) is in Houston (Zip Code 77449), with 119,204 residents!
Even still, the largest Zip Code will likely take at most about 30 – 40+ Work Hours.
For lower and average population Zip Codes, when your Procedure is mature, your Overseas VA might be able to finish one Niche Analysis Report in as little as 5 Work Hours!