Thursday, September 21, 2006

Mortgage lead conversion rates

Inman News did a nice job yesterday covering a new study from consulting firm Real IQ, measuring conversion rates of mortgage leads generated by HouseValues. The net of the findings was that nearly one in four loan requests convert into a transaction within a year.

Two other very interesting angles that the Inman story also picked up on:

1) Conversion rates are relative: Individual mortgage brokers, and real estate agents as well, can accelerate their own conversion rates by staying active in managing their pipeline of prospective customers.

2) The conversion rate is still growing: We know from past research that consumers often take up to two years to actually buy or sell a home. Some of those unconverted leads after one year will almost certainly transact within the next few months. And the smart real estate agent or mortgage broker who maintains the relationship over the long-term will have a distinct advantage in winning that consumer's business.