Are your buyers feeling priced out of their market? Perhaps it’s time to recommend a big move.
04.27.2022 | Category: Homebuying
According to Porch, 61% of renters are priced out of their cities. Not surprisingly, of the 260 metropolitan areas analyzed, California is home to 10 out of 13 areas where 90% of renters are priced out of buying. In fact, the top five least affordable cities for renters in the study are all located in California.
California, the nation’s most populous state, has long had a reputation for being a location that’s expensive and competitive for homebuyers. And while other cities cracked the top ten least affordable, a variety of metropolitan areas with homes that are the most affordable to the vast majority exist. Topping the list is Johnston, Pennsylvania, a former industrial town with a growing health care and high-tech defense economy.
If your buyers are feeling priced out of their market, there are still plenty of opportunities for them to achieve homeownership with the right relocation plan in place. Help them realize their homeownership potential with these practical tips.
Research the market you're looking to move to
Recommend clients consider joining neighborhood groups on NextDoor or Facebook. Suggest to your clients to read the community's daily paper or watch its local news. Tell them to research everything from the city's safety rating to the unemployment rate, weather patterns, and traffic before they make a big move.
While Johnston, Pennsylvania topped the list of most affordable cities for renters, this might not be the city for your client. Is walkability a key factor in deciding whether or not they want to move to a particular city? Will they be working from home, so a commute isn't a factor? Get to know them on a personal level so you can make recommendations that help them see how moving to an affordable city could be a great financial decision for them.
Be sure your clients are pre-approved with a reputable nationwide lender
The most important step to any real estate transaction is ensuring your clients are financially prepared to take on the responsibility of homeownership. Be sure to check with your client that the lender they wish to work with is reputable and licensed to work in the state they wish to relocate to. Lenders like Mutual of Omaha Mortgage are specifically equipped to help buyers relocate, especially active duty or veteran military and their families.
While going through the pre-approval process, this will also give your client an opportunity to determine the overall affordability of the area they wish to move to. While they might find that homes are quite affordable, other convenient amenities they are accustomed to in major metropolitan cities like nearby grocery stores, schools or hospitals might be a further commute and add to transportation costs. Moving from a state with mild or moderate weather to a state with snow or severe storm seasons may mean higher costs in heat or home maintenance.
These factors will all play a part in budgeting for a down payment and closing costs but are often taken for granted by the first-time homebuyers. By being a real estate professional, your clients can trust with their personal finances, you will build a network of referral-based clients and grow your income potential.
Encourage your client to choose a team that specializes in relocation
By working with a reputable team that specializes in relocation for out-of-state buyers, you can continue to build a great pipeline of clients helping renters realize their homeownership potential by moving out of high-cost metropolitan areas.
As a real estate professional, you can get your Certified Residential Specialist (CRS) or Military Relocation Professional (MRP) from the National Association of REALTORS® opening up your network to referrals from out-of-state buyers looking to move to your affordable home market. These real estate professionals will often have excellent recommendations for other services like lenders who specialize in buyers moving out of state, movers and insurance companies.
Inform your client of their options
Many would-be homebuyers are intimidated by the process of buying a house out of state. Between travel plans to a prospective neighborhood, learning about a new community, and navigating unknown territory it's important that your clients know they can rely on you to provide a variety of options that can meet their needs.
For example, in today's ever-increasing digital environment, many homebuyers can use a mobile app to upload secure documents and track their loan status from the palm of their hand. In addition, buyers can take virtual tours of properties from their home and meet with other real estate professionals over zoom. If the buyer can't be at the property in person for the inspection, for example, recommend a trusted colleague in that city to do the walkthrough for the buyer with the buyer on video conference. Get creative and build your buyer's trust to build your relocation pipeline in no time.
While much of the United States is experiencing a competitive market, homeownership is still very attainable. If you have clients ready to buy outside their current market, be sure to refer them to Mutual of Omaha Mortgage for pre-approval. Our loan specialists can help you every step of the way with our new mobile app, highly trained team and service you can trust.