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Recently I blogged about the great opportunities investor clients represent to brokers. But how can you most effectively capture this target market?
To recap in a nutshell: investors are sticky, they usually represent repeat business and they almost always deliver great referral business.
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What’s more, property is increasingly being approached with an investment mindset, a trend that is certainly gathering pace amongst young buyers.
As a result of both affordability pressures, and an increasing understanding of property’s wealth building potential, we are seeing more young Australians make their first steps into the market with an investment property. I know this is certainly the case in my business.
Recent ABS housing finance figures also confirm strong activity in the investment lending space, with investor approvals up 2.9 per cent in December and staggering annual growth of 40 per cent - the highest level in 10 years. Much of this activity is thought to be first time investors.
So how can you pitch your business to investors?
First and foremost, you’ve got to position your business accordingly. Think ‘property investment’, ‘passive income’, ‘capital growth’, ‘rental yields’ and ‘wealth creation’. These are the kinds of key words you need to associate your service with and build into your marketing communications.
Do however avoid too much ‘hype’ so you don’t associate yourself with spruikers. Steer clear of words or phrases like ‘get rich quick’, ‘easy profits’ and overinflated returns.
You also want to highlight investment opportunities in your client correspondence. Discuss market trends and opportunities in client newsletters or your blog, share successful investor client stories and copy clients in on any news items you think might be of interest.
Also recognise that property investors don’t just need a broker – they require a full spectrum of services. Conveyancing, accounting, buyer’s agents, property managers and financial planners, are just some of the professionals with whom an investor will engage.
With this in mind, more and more brokers are moving to offer a more all-inclusive service offering – and this makes sense. The easier we can make the process for our clients, the more satisfied they will be with our service.
Expanding your service offering can be challenging though, so one of the easiest ways to cater to investors is to develop a referral network, incorporating each key professional an investor may require.
While this helps you to help your client, it also works to bring in business. Having your business card on hand with an estate agent, for example, who can suggest investors contact you regarding finance, is invaluable.
In particular, if you’re looking to target investors, the addition of some form of property investment advice is priceless.
Set up a referral partnership with a qualified property investment adviser (QPIA), who can work with clients to develop a genuine, strategic investment plan for your clients.
Alternatively, develop your own property investment expertise or a colleague’s, with a course such as PIPA’s QPIA, and bring property investment advice in-house, effectively creating a new fee-for-service revenue stream.
Already have referral partnerships in place? It might be time to review them and see how you can maximise your arrangements to best capture investor business.
Finally, together with your referral partners, in-house specialists or simply a team of good local operators, hold a property investment information night – you’d be surprised at how many people will come along if you have someone who knows what they are talking about, the content is rich and the event isn’t too hard-sell.
Of course, if you want to target property investors, it always helps if you can speak from experience. If you haven’t already, look at building your own property portfolio, and even sharing some of your stories with your client base.
