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Advice Your Buyers Are Getting: The Good, Bad, and Ugly

Advice Buyers Receive

When someone is ready to buy a home, it’s 99% certain that they are going to look up advice on how to go about the process. Even folks who are not first-time buyers look for information because they assume, correctly, that the market has changed a lot since they last purchased.

It’d be great if people took advice from you or another qualified professional, but unfortunately, they don’t. As a result, some of the information they receive is good, some is bad, and some is downright ugly.

However, being a great buyer’s agent means knowing what people are being told and how you’ll react to common question and objections. To help, here’s a list of popular advice given to buyers and how to be ready to respond.

“Don’t Buy in a Renter’s Neighborhood”

The Advice:

The idea with this advice is that it only takes a few bad renters to make the neighborhood undesirable to both the buyer and any potential residents that the client may eventually want to sell to. Similar advice is to be sure there are families on the street if you plan to have a family, so your kids have someone to play with.

How to Respond:

First, encourage the buyer to take the long view and realize that things change. Once they have a family, there may be several other families on the street. Or, the families there now may move away. In addition, there can always be renters in a neighborhood. It’s totally outside their control.

Secondly, do your best to match them with a home that fits their needs. Is there an area they could buy in where the HOA prohibits renting? Is there a neighborhood known for great schools that would naturally attract a lot of families with kids?

“Think Long Term – Look for Bones and Resale Value”

The Advice:

A lot of advice to homebuyers, especially first-timers, is to look past the initial appearance. People are encouraged to overlook junk and ignore staging, and just look at the bones of the house. In addition, buyers are encouraged to think beyond today and think about how easy it will be to resell the home in the future.

How to Respond:

First, be sure to point out factors about a possible home that lead to great resale value – a good neighborhood, nearby shopping or schools, and a quiet street, for instance. Avoid showing homes that would be poor long-term investments.

In addition, help your buyers see past staging and make a decision that’s both emotional and reasonable. If a stager put lamps in a bedroom where there are no outlets, point that out. Make sure the buyers know the value they’re getting in a good quality home, not one with pretty “makeup.”

“Know the WHOLE Cost of Owning the Home”

The Advice:

Buyers are frequently told not to budget for the mortgage alone, but also for taxes, HOA fees, upkeep, closing costs, and more. This is great advice because it ensures your buyer is ready to follow through with closing and is much less likely to get cold feet or buyer’s remorse.

How to Respond:

Provide excellent information! Be a buyer’s agent that is truly on your client’s side. Don’t show them homes “just out of range” to try to score a larger commission. That strategy makes the customer feel frustrated and disrespected. Also, it can backfire and lead to a buyer backing out before closing.

By being a buyer’s agent that helps your client understand the full cost of home ownership, you’ll be providing excellent service and generating a lot of good will that will help bring in referrals and great reviews.

“Get an Inspection to Avoid a Lemon”

The Advice:

Buyers are inundated with horror stories of purchases gone wrong and are assured that if they have an inspection, these problems will be discovered before they buy. This is partly true, but not entirely.

How to Respond:

First, help homebuyers be realistic about what they should expect in their price range. If they think they are getting a move-in ready, renovated place with a bottom-level budget, they will be disappointed. Also, help them understand the actual cost of renovation – having a partnership with a contractor they can talk to would be helpful.

Secondly, make sure you have a partnership with an excellent and honest inspector. Let the homeowners know that not all inspectors are created equal and that if they use your resource, you know they’re getting a good one.

Finally, help buyers be realistic about what a home inspection will uncover. An inspection is not a Mike-Holmes-style gut and rebuild. It won’t find everything that might need to be fixed. And repairs are part of owning a home – no inspection will change that.

“Don’t Worry About Being Pre-Approved for a Mortgage”

The Advice:

This is advice that a buyer is likely to get from a friend or relative rather than a buyer’s class or online article. The idea is that a pre-approval isn’t official anyway and that if you’re just starting to look it’s not worth the time or hassle.

How to Respond:

Let a potential buyer know that if they are not pre-approved for a mortgage before looking at homes, they won’t be able to put in an offer on a home they love. It also helps them be clear about their actual budget. Remind them how quickly homes go, and that by the time they get vetted for a mortgage the home they wanted will probably already be purchased by someone else.

You can also choose not to work with buyers who are not pre-approved, to avoid wasting your time. Of course, you should try to convince them to pre-approve before you give up on them.

“You Don’t Need an Agent, Especially if You Buy a FSBO”

The Advice:

People who mistrust real estate agents will tell home buyers to avoid using them. The assumption is that the purchaser and seller are two honest people who will do the deal themselves and cut out the middleman. Both sides supposedly save money.

How to Respond:

This is terrible advice, and not just because Realtors® need to eat. Buying a home is a very complicated process, contracts are incredibly detailed, and inspections, assessments, and closing have a lot of moving parts that can go wrong.

The key is to help home buyers recognize that this is not the same as buying a new pair of jeans or even a new car. They could end up stuck with a home that’s in poor shape, with little to no recourse, because they didn’t handle the legal side correctly. For the biggest investment of their lives, they can’t afford to take that risk.

Are You Ready for Your Buyer?

This article only scratches the surface of the advice buyers receive. By keeping in mind the fact that clients are receiving a lot of advice, much of it from unreliable sources, you are better prepared as a buyer’s agent.

Using your print marketing to address some common misconceptions that buyers have is a good way to build trust and educate your prospects. Whether you need postcards or brochures, Printerbees is here to help!

What’s the craziest advice a buyer has told you they received? Share in the comments!

3 Ways to Take Advantage of Fall 2016 in Real Estate

Fall 2016 in Real Estate

Welcome to Fall! In many parts of the country the weather is cooler, leaves begin to change, and the real estate market shifts. Where summer is a frenzy of buying and selling, hoping to relocate before school starts, fall has a slower pace. And that pace is welcome.

At the same time, fall weather provides an ideal backdrop for walking through neighborhoods admiring homes for sale. You also get some of your most beautiful real estate listing photos in fall. With these post-Labor Day changes in mind, here are three ways to take advantage of fall 2016 in real estate.

Focus on Buyers

Many Realtors® find they can negotiate a better price for buyers during the fall. There’s less competition for listed homes, and less of a rush to move before school starts. As a result, fall can be something of a buyer’s market, even when inventory is lower than average. In addition, sellers who haven’t sold by fall are likely to reduce their prices, leading to better deals for buyers.

In addition, you’ll want to encourage your buyers to choose a home before interest rates begin to rise. Right now we’re still seeing historically low interest rates, and you want to remind your buyers not to take this for granted. The Mortgage Bankers Association is forecasting the rate to creep consistently upward through the end of 2017. As a result, this fall is the perfect time to buy.

Work with Vacation Home Transactions

Savvy buyers know that the best time to buy a vacation home is in the fall. That way, fix-ups and furnishing can be done by spring, which is when vacationers start to use their property. While some people buy vacation homes in the spring and summer, those looking for a good deal know that starting in the off-season is the way to go. As a Realtor®, encourage vacation home buyers and sellers to take advantage of the fall season.

Fall isn’t the off-season in every vacation market. If you’re in Colorado or the Rocky Mountains, vacation activity is just starting to heat up. Buyers can look at resort properties for their own enjoyment, or as a chance to make good money from renters who are visiting the area for skiing, snowboarding, and more. When you approach buyers and sellers with these ideas, you can encourage them to hire you to handle the transaction.

Encourage Renters to Buy and Introduce Alternative Financing

Depending on your market, fall can be a great time to start cultivating renters who want to move. If they aren’t ready to look at homes right away, build your relationship during the holidays and ask again in the spring. With a 12-month lease cycle, either fall or spring will be the perfect time to start looking. Rents have climbed and continue to do so in most parts of the country, meaning that renters are feeling the strain. You can talk to them about how buying may actually save them money each month.

The rise in rents is fueled by very high demand for rental properties because many Americans simply don’t have the creditworthiness or down payment available to buy a home. As a result, a big part of marketing to renters is knowing what alternative financing is available. Can you help first-time home-buyers who don’t have a down payment? Do you know of rent-to-own options? If so, you can quickly become a go-to Realtor® and dramatically increase your business this fall.

Post-Labor-Day real estate markets are more relaxed than spring and summer. Take advantage of fall 2016 by focusing on buyers, working with vacation home transactions, and helping renters into the housing market. As you do, make sure your Just Listed and Just Sold postcards are ready. Need help? Take a look at our selection today!

The difference between a good and a great Realtor® is $10,000

I’m currently in the process of purchasing a home and have attempted to how to be the best realtorwork with a total of eight different Realtors® over the last six months. The first seven weren’t “great,” and I’m not even sure they are “good” as a Realtor® because I couldn’t get any of them to follow up with me.   It was the eighth Realtor®, named Mark who really showed up for work and showed me the difference between good and great.  Because he’s great, I have finally found a home after more than six months of searching (on my own…self-serve) and I couldn’t be more pleased.

Allow me to elaborate…

I met Mark at an open house that I literally ran through on my way to a volleyball game I was running late for.  I quickly gave him my contact information, told him what I was looking for and asked him to follow up with me.  I told him I was seriously searching for a home and hadn’t found a Realtor® in the seven I had tried to work with who I felt took my search seriously.  My experience with the others was “let me set you up on a MLS portal, send you the listings daily and you, let me know what you like.”  It was definitely a “self-serve, raise your hand and let me know if you see anything interesting,” sort of situation. I received no phone calls, tips on homes that had just come on the market, coming soons or anything else.

It wasn’t until Mark followed up with me that I saw and experienced a Realtor® who was “working” for me…hunting for my perfect home, on my behalf.  Mark contacted me within 24 hours to let me know that he had looked at all the homes on the market and had identified a few that may be a fit.  We went over the homes on-line so he could get a feel for what I liked and didn’t like and narrowed it down to one home I wanted to see.   It was a great house!  I loved the floor-plan, the lot size, the pool, the price and everything else…it was perfect.  Unfortunately I wasn’t the only one who thought so and I was “late to the party” so it went pending before I had the opportunity to make an offer on the home. I was truly disappointed, but kept my chin up knowing that something else would come along.

Thank goodness Mark was watching the market on my behalf, because he found another home that was a good fit for me and my family and this time we weren’t late to the party.  We were the first to see the home and were able to get our offer in, in a timely manner.  Unfortunately, word came the following morning that our offer wasn’t accepted and the seller went with a different buyer, another disappointing blow.  Bummer!  The good ones go quickly, don’t they?

Thankfully Mark was doing his job as my Realtor® and found another home within hours of learning our offer had been rejected.  It was a listing that had been pending and had fallen out of contract, that day. He contacted me and asked if we could tour the home to see if it was a fit. It met all of my criteria with the exception of having a pool and he felt confident I would like it if I gave it a chance.

The house was perfect and the exact same floor plan of the first house I saw, loved and wanted.  This was a better lot, (the end of a cul-de-sac!!!) better location and though it doesn’t have a pool, I can build a pool (what I want) with the $35,000 I’m saving on the cost of the house.

Because the house had recently fallen out of contract, the seller accepted our offer quickly. They’ve been pleasant and agreeable and things are going well. Had Mark not been doing his job as my buyers agent, watching the market for me, I might not have gotten this house.

Pssst…I should also mention that it’s a single story, and you know how much harder those are to come by! There’s like one single story for every ten two-story houses on the market out there.

Shout out to Mark for being great at your profession and for doing your job as my Realtor®. You found me a house, an amazing house because you showed up for work and didn’t expect that I would do the job of finding my own home and “let you know.” It took him only about two weeks to find me a home and himself a nice $10,000 broker check.

I’m curious to know what you believe your role is for your clients in finding the perfect home and if you feel you’re doing a good job at “showing up” for work and for your clients.