The KPIs and Metrics That Matter for Real Estate Success

The New Year is a great time to set new goals, but you'll also need to get clear on your path to each one. One of the best ways to ensure you're on track to hit your goals? By monitoring your success metrics.

There's plenty out there on the metrics real estate pros need to monitor, but we're going to break down the ones that matter, no matter where you are in your real estate career.

Why It's Important to Keep an Eye on Your KPIs

Before we take a closer look at the crucial key performance indicators, or KPIs, real estate professionals need to track, it's important to understand why tracking these metrics is key. Hint: it's not just for your brag sheet. Tracking your KPIs regularly is crucial for real estate pros, no matter where they are in their career journey. Monitoring your KPIs is crucial to gauging your success and getting clear on areas you can improve.

By knowing where you're performing well, you can build upon your success by knowing exactly where to focus and take more impactful, meaningful actions. And keeping an eye on areas to improve helps ensure you're staying on track towards your goals, providing you the opportunity to prevent falling off course completely.

Agents

For the solo agent, the KPIs you track will be relatively consistent across the board, whether you're a buyer or seller agent. To ensure success, you'll want to track:

• Your transaction volume: Transaction volume is the total number of properties you've helped buyers purchase or you've helped get successfully sold. Monitoring your transaction volume will help you ensure your lead generation efforts and conversion rate keep you on track for your revenue goals.
• Your lead generation volume: This is the total number of leads you've generated across all your sources, online and offline. By tracking this KPI, you can see how many potential clients are interested in working with you, so you know which campaigns or outreach efforts are most effective.
• Your lead conversion rate: Going hand in hand with your lead generation volume is your lead conversion rate. This is the percentage of leads that turned into closed deals. Knowing your lead conversion rate will help you understand your most successful lead generation efforts, and help you keep your finger on the pulse of your sales and negotiation skills.
• Your Gross Commission Income (GCI): This KPI is the amount of income you earn from your commission on a transaction. It's important to monitor your GCI to keep your finger on the pulse of your finances. GCI can fluctuate for a variety of reasons, so monitoring your own personal trends is key.
• Your Net Commission Income (NCI): On the flipside, your Net Commission Income, or NCI, is the amount of income you earn but with key expenses subtracted, like brokerage or transaction fees, taxes, other miscellaneous fees, and more. Keep track of your NCI to monitor your annual income and finances.

Midsize Teams and Brokerages

As we expand to midsize teams and brokerages, the KPIs these real estate pros need to track also level up. If you fall into this category, you'll want to stay on top of the following KPIs in addition to the ones agents typically track above:

• The team's transaction volume: This goes without saying, but you'll want to keep watch on your team or brokerage's overall transaction volume, as well as drilling down into each individual agent's transaction volume. Keeping close watch on this KPI will allow you to get a good grasp on how you're pacing to your goals, and give you insight into any star players or areas of opportunity to train or improve.
• Your group's agent retention rate: Your retention rate is made up of the percentage of agents who stay onboard your team or brokerage. This is crucial to understand agent satisfaction, as well as how well you're training, growing, and developing your team. It also provides insights into how well the tools you give your group impacts their performance and willingness to keep working with you.
• Your marketing return on investment (ROI): Investing in marketing for your brokerage and your agents is a must. So, you can't skip out on tracking your marketing ROI. Monitoring this metric will help you know which channels are the most effective, what campaign types move the needle most for leads, and allow you to better manage your marketing budget overall.
• Continuing education and training completion: Tracking how much your agents keep up with opportunities for training or continuing education (CE) courses is another great metric to track. This helps you understand what investment they're making in their overall skillset, as well as what courses or sessions are resonating with your agents. It also ties into your agent retention rate.

Expansion-Level Brokerages

At this level of real estate professional, your brokerage has grown and expanded beyond its initial market to serve a variety of regions and areas. To measure success as an expansion-level brokerage, these real estate pros need to track the agent-level and team-level KPIs listed above, as well as more comprehensive KPIs, such as:

• Your offices' or branches' performance: Arguably the most important KPI to watch is the performance of each office or branch in your brokerage. Think of this like tracking each of the KPIs listed in the previous sections above. This will give you a laser focus on each offices' strengths, areas to improve, helping you monitor the viability in the market they serve.
• Agent recruitment and retention rate: We covered the importance of brokerages and teams keeping an eye on their retention rate, and that applies here as a KPI, too. But you'll also want to measure recruitment rates, or how many agents are being brought on to work in each branch or office. This will help you understand your competitive advantage in those markets.
• Customer satisfaction: Each market will have its own specific characteristics, especially with the clients served. Counting customer satisfaction as a KPI is a must. Whether you source testimonials, conduct customer interviews, or send out surveys, make sure to listen to what customers are saying. This will give you a real-life feel for what it's like working with your agents and their perception of your brokerage and brand.
• Technology adoption and usage: It's important to invest in powerful tools and software to optimize your brokerages' operations. But it's also important to measure if this tech is actually being learned and used. Make sure to track how much agents are using the tools you provide, attending training sessions, and source their feedback. This will help you ensure your technology investment is proving its ROI.

To view the original article, visit the Inside Real Estate blog.

Related reading

• Metrics Are More Than Just Numbers
• 5 Real Estate Marketing Metrics to Help You Grow Your Business
• Why the Top Agents Leverage Success Metrics in a Shifting Market