COVID-19 Continues to Impact Homebuyer Decisions
Based on a recent survey, one in 10 Americans plans to buy a home this year. The survey also found that the pandemic is still playing a huge role in the choices of potential homebuyers.
Specifically, 41% of respondents said the pandemic has made them rethink where they live or will live in the future. Another 27% have already moved at least once since the pandemic began. Their reasons for moving during the pandemic included: a new job at 27%, cheaper cost of living at 21%, and being closer to relatives at 20%. The flexibility of remote work came in at 18% and moving from the city to a suburb or rural area was 15%.1
New Home Builders Still Squeezed by Building Costs
Realtors® are required to follow fair housing laws in advertising. Ads should always be free of indicating any preferences or limitations based on race, color, religion sex, disability, family status, and national origin.
This has led to a 31% increase in new home prices in only three years, with average new home prices hitting $511,000 in February 2022. But there's some good news: lumber prices have fallen 39% since March 2022, and 52% below the peak price of $1,733 per thousand board feet in May 2021.2
How You Can Beat Out Cash Buyers
As the market reached scorching levels in 2020 and 2021, we began to see an unprecedented number of investors with deep pockets begin to dominate residential real estate. With many investors paying in cash (NAR recently reported these rising to 27%), buyers with mortgages may feel like they're at a disadvantage. However, there are a few tips you can use to help your clients get ahead of the cashed-up competition.
Submit your buyer's offer early Staying up to date on industry trends helps keep you competetive in this white-hot market. It also provides you with interesting talking points and arms you with statistics that help attract and maintain relationships. Here are a few fun facts all agents should know. Inflation has skyrocketed to a 40-year high, with the average consumer spending $500 more on living expenses compared to a year ago. This could lead many homebuyers to lower their budgets, according to research economist Gay Cororaton with the National Association of Realtors®(NAR). She suggests that house hunters would be smart to shop for a house about $40,000 cheaper than their 2021 budget, since inflation's effect on prices has directly impacted their debt-to-income ratios and ability to buy a home.
5 Sources: 1themreport.com, 2magazine.realtor, 3theclose.com, 4spotlessagency.com, 5magazine.realtor
This gives them a better chance, especially if you incorporate the next two strategies as well. Also, you could be in first place if the seller decides to accept an offer early because they're tired of vacating their home for showings.
Pick up some closing costs
Many of today's sellers say they feel nickel-and-dimed by buyer's agents. Therefore, offering to cover some or all closing costs can go a long way towards winning the sale. This gesture can put your buyer ahead of others, especially when dealing with a money-conscious seller.
Stand out in a positive way
Be sure to be polite, memorable, and likeable. It could put you ahead of other agents who use an aggressive approach or insist on haggling. If your buyer can leave online feedback, encourage them to describe how much they loved the home, since agents often share these with the seller.3
Three Shocking Real Estate Facts Agents Should Know
1. Repeat customers are preferred but not the most common. Only 30% of earnings are received from repeat customers' or referrals. To boost repeat business, be sure to ask for honest feedback about your clients experience with you. If they were happy, ask for their future business and referrals. If not, take notes, apologize, explain, and apply the knowledge to the next client.
2. Reviews matter more than you think. For clients, the most significant characteristic of an agent is a professional reputation. Your prospects will do their homework before working with you. That means researching your name, reading client reviews, and reviewing your social media sites to better understand your interests and personality. Go the extra mile to ensure that what they find aligns with the brand you wish to build.
3. Technology is King. The most difficult thing for 48% of agents is following changes in technology. As we've seen in recent years, the professionals who evolve their business practices to meet the challenges of today, are the most successful. In fact, recent data shows that agents with high commissions use advanced technology tools two times more often than others.4Homebuyers' Wallets Up To $40K Lighter
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