Lead generation guide · 7 min read
Every lead vendor competes on cost per lead because it is the metric that flatters them most. It is also the metric that tells you least. Here are current benchmarks by channel, and a calculator that converts any cost per lead into the two numbers that decide whether the spend works: cost per appointment and cost per closing.
Move the sliders to match your brokerage. The defaults reflect typical shared portal-lead economics, which is a useful baseline to beat.
Cost per closing calculator
Cost per lead is the wrong number to optimise. Move the sliders to see what each closing costs once conversion rates are applied — that is the number that decides whether your lead budget pays for itself.
What you spend per month on lead acquisition.
Portal and aggregator leads commonly run $150-$300.
Shared portal leads: 3-8%. Qualified exclusive leads: 20-35%.
Most brokerages land between 20% and 40%.
One side of the transaction, before splits.
The portion your brokerage keeps after the agent split.
Per month, at these numbers
Return on lead spend
-80%
At these conversion rates the lead spend does not return brokerage revenue. Lowering cost per lead or raising the lead-to-appointment rate are the two levers that fix it fastest.
Illustrative model only. Actual results depend on market, price band, follow-up speed and agent capacity.
Ranges vary by market and price band, but these are the bands we see most consistently across brokerage engagements:
Cost per lead ignores the two multipliers that dominate the outcome: exclusivity and qualification. A shared lead is a race against three competitors; a qualified lead has already confirmed intent, property, and timeline before your agent picks up the phone.
Those multipliers move lead-to-appointment rates from roughly 3-8% to roughly 20-35%. A four-to-five-fold swing in conversion overwhelms almost any difference in per-lead price. This is why a $29 lead and a $250 lead are not different prices for the same product — they are different products.
1. Speed to first contact. Free to fix, and usually the largest single gain available. Contact within five minutes versus within an hour can multiply conversion several times over on the same leads you are already paying for.
2. Qualification before hand-off. Every unqualified lead your agents work is capacity you paid for twice. A live qualification step ahead of hand-off raises appointment rates and protects agent morale at the same time.
3. Cadence depth. Most brokerages stop at three touches; most conversions happen after five. Extending the sequence costs nothing in media and lifts conversion on the entire existing spend.
Notice that none of the three involve buying more leads. Fix these before you raise budget — otherwise you scale the leak.
Work backwards from a production target rather than forwards from a spend number:
Then apply the floor test: if the resulting budget produces fewer than about 30 leads per month, you do not have enough data to optimise and results will look random. Consolidate into one channel until you clear the floor rather than spreading a small budget across three.
Across channels the range is roughly $20 to $300 per lead. Shared portal leads average $150-$300, paid social campaigns on your own ad accounts commonly land between $29 and $80, direct mail farming runs $40-$120 per response, and database reactivation is effectively free beyond the labour to run it.
Divide cost per lead by the product of your lead-to-appointment rate and your appointment-to-close rate. At $200 per lead, a 6% appointment rate and a 30% close rate, cost per closing is $200 ÷ (0.06 × 0.30) ≈ $11,111.
No. A cheap lead that never converts is infinitely expensive. Cost per lead only matters in combination with exclusivity and qualification — the metric to optimise is cost per closing, and occasionally a more expensive lead wins on that basis.
A common working range is 10-20% of expected gross commission from the pipeline that leads support. More useful than a percentage is a floor test: budget enough to generate at least 30-50 leads per month per producing agent you intend to feed, or the data is too thin to optimise.
How the four vendor models compare once cost per closing is applied.
The follow-up conditions that decide whether bought leads pay off.
Channels ranked by cost per closing rather than ease of purchase.
Listing-side pipeline, which carries the better margin.
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