The Recession-Proof Real Estate Agent Checklist

For all the agents starting to worry about an upcoming recession, we’re offering a totally free recession-proof real estate agent checklist to help you prepare your business for the changing market conditions.

This post was originally written at the end of March 2020 in the early days of COVID when we had no idea how the economy and the housing market would react to the outbreak. At that time, I urged everyone to remember a few important things:

1. Recessions are a perfectly normal part of the economic cycle.
2. The Great Recession of 2008 originated in the mortgage market and hit housing extra hard; the next recession will be different.
3. Even in a recession, people need to move. There will still be buyers and sellers available for the agents willing to work for them.
4. With a little foresight, you can prepare your real estate business to weather this new recession. And maybe even grow through it!

These facts hold true as of this new publication in October of 2022. So, with these facts in mind, let’s start recession-proofing your business. Here is your recession-proof real estate agent checklist.

The Recession-Proof Real Estate Agent Checklist

Your recession-proof real estate agent checklist covers six main categories:

1. Lead-gen
2. Follow-through
3. Scripts
4. Operations
5. Expenses
6. Income

And you’ll get some actionable strategies for each category.

By the way, if you want a convenient two-page printable of this checklist, just enter your contact info in the form below, and a link to the download will be delivered right to your inbox.

1. Recession-Proof Your Lead Gen

To recession-proof your lead generation, focus on these six recession-friendly groups:

1. Investors
2. Renters
3. Upgraders
4. Expired Listings
5. Short Sales 
6. Bank-Owned (REO)

These are the groups that are most likely to buy and sell during a down market.

And there are lots of ways to reach these key groups:

• Launch a Renter-to-Homeowner Program. Instead of sending mailers to renters and hoping for the best, start a more effective Renter-to-Homeowner Program that benefits your future buyers, you, and even your local apartment community owners and managers!
• Invest time in content marketing (aka blogging) to generate 3x the leads at 62% lower costs than traditional marketing. If you already have your own website, there is zero direct financial cost. It’s just the cost of your time to write your posts (and with a down market, you may have more time available than normal).   
• Stay top-of-mind and get new leads via social media. You just need a lead-generating social media strategy.
• Help your community through sponsorships and volunteer projects. Show up for your community when times are tough, and they’ll show up for you!
• Host free seminars and workshops to educate your target groups and earn new clients. Added bonus: these seminars cement your reputation as the authority on local real estate matters.
• Reach out to asset managers at local banks to become the go-to REO listing agent. If your market is declining to the point of increased foreclosures, REO listings are an incredible source of repeat business.
• Help homeowners in difficult situations avoid foreclosure through short sales. This takes an exceptionally empathetic agent, but you can carve out a recession-proof niche as a short sale specialist.
• Build your referral business by showing genuine gratitude, providing ongoing value, and maintaining those personal relationships.

By focusing your Prospecting Power Hour on these key groups and lead-generating activities, you’ll have a full pipeline all recession long!

2. Recession-Proof Your Lead Follow-Through

It kills me how dismissive most agents are with their incoming leads. That may be fine when the market’s hot and new leads are popping up regularly. But when a recession hits, every lead matters. So make sure you’re handling your lead follow-thru properly.

First, respond immediately. You may even want to invest in an auto-responder system to reply to leads immediately when you’re unavailable.

Then, make sure your response includes three parts:

1. Answer the question
2. Make them want more info
3. Invite an appointment

Finally, capture the lead on your CRM, and schedule your follow-ups for Days 1-31 and beyond.

3. Recession-Proof Your Scripts

Some agents hate scripts. And that’s fine. But you should at least have an idea of what to say to your six recession-friendly groups when you make the first contact and when you follow up. 

I personally appreciate scripts because they free up brainpower so you can focus on your clients’ reactions instead of the words you’re choosing in the moment.

If you haven’t already read The Book of Yes by Kevin Ward, check that out for normal-market scripts including listing presentations and overcoming objections.

4. Recession-Proof Your Operations

Here are a few quick tips for recession-proofing your operations:

• Increase your daily prospecting time from one hour to two hours.
• Allocate one or two hours per day for building your recession-proof income stream(s) (as we’ll outline in Section 6).
• Insist on pre-approvals and educate your buyers on mortgage requirements. With tighter lending requirements, you want to be extra sure your buyers qualify before investing your valuable time in touring properties.
• Win at your listing appointments by including additional services, free of charge, for your sellers (pick one or all!):
  • Staging
  • Professional photos
  • 3D home tours
  • Facebook Live video tours
• Focus on lower price points since luxury real estate is a tough sell in a recession.
• Become an expert in creative financing so you can recognize opportunities for your clients. I know most agents want to avoid all financing talk to limit their liability. But when you defer all questions to a lender, you’re giving the impression that you just don’t know anything about real estate finance. If you want to be viewed as a real estate expert, you need to be able to explain real estate finance. And then give your disclaimer about how the lender will have the most up-to-date figures and can offer the best possible advice on the ever-changing mortgage market.

These operational improvements are easy to implement and will make a world of difference in your recession-proof business model.

5. Recession-Proof Your Expenses

Cutting expenses during a recession is a quick way to increase your profit margins. Trim the fat on over-blown expenses like purchased leads, business services, and software subscriptions. Now may also be a good time to renegotiate your commission split and/or broker fees so you keep more of the money you earn.

One thing you shouldn’t cut? Your marketing budget. Which is interesting because this is often among the first expenses agents cut. I would argue that now is the time to increase your marketing budget! If other agents are pulling back and you push forward, you’re going to make big gains in mind share and market share.

Finally, make sure you’re utilizing your personnel wisely. Check out our full post on recession-proofing expenses for clever ways to make the most of your personnel when finances are tight.

6. Recession-Proof Your Income

And finally, my favorite section of your recession-proof real estate agent checklist: recession-proofing your income.

For some reason, this never occurs to most agents. They limit themselves to commissions on real estate transactions and leave a small fortune on the table. Don’t box yourself in like that! Take advantage of our clever ways to increase your income during a recession (without taking a part-time job!).

First, expand your business offerings through the recession to better serve your clients, grow your business, and boost your income. Consider real estate-related income streams that perfectly suit your existing real estate business. Services like:

Credit Repair

In a down market, lenders are more cautious about lending to buyers with iffy credit. Bad news for agents who don’t know how to work with low-credit buyers; excellent news for agents who offer credit repair services. 

Not only do you help someone in need repair their credit (and get paid a reasonable fee for your services!), but you’re also saving your sale now that these buyers can qualify for a home loan!

Property Management

In many markets, a down housing market actually makes the rental market stronger. Lots of potential sellers don’t want to sell during a down market, so instead of selling when they have to relocate, they opt to rent out their homes. And there is also an influx of SFR renters who can’t qualify for a home loan under the more stringent lender requirements. 

Offering property management services is a great way to earn a solid income while connecting with tomorrow’s buyers and sellers.

Property Tax Appeals

Only the savviest agents consider property tax appeals. Most agents just think boring… and completely ignore this killer opportunity. But real estate agents already have about 90% of the skills and knowledge needed to offer property tax appeal services! 

All you have to do is show your local taxing authority that the value of your client’s home has dropped due to the recession, so their property taxes need to be adjusted accordingly. In most jurisdictions, this just means filing an appeal application and presenting a CMA to the Appeals Board to show them the current market value of the property. Then you get a percentage of the tax savings/refund as your fee. 

It’s super easy to get started and incredibly lucrative in a declining market!

Other Ways to Boost Income During a Recession

While adding services is maybe the best way to boost your real estate income during a recession, it’s not the only way. Consider these other ideas:

• Invest in real estate for passive income
• Create a product.  eBooks, online courses, and digital downloads all provide passive income after your initial time investment in creating and marketing the product.
• Monetize your real estate blog. That’s right; you can turn your real estate blog (which you should be writing as a lead-generator anyway) into its own income stream!

Get Your Complete Recession-Proof Guide!

If you’re serious about growing your real estate business during a slow market, check out The Recession-Proof Real Estate Agent. This book offers a complete step-by-step guide to recession-proofing your real estate business.

And don’t forget to grab your simplified two-page printable recession-proof real estate agent checklist before you go.