Preparing Your Buyers For Today’s Housing Market
10.5.2022 | Category: Homebuying
Climbing interest rates. Limited inventories. Volatile home prices. While conditions look bleak for today’s home buyer, our tips can help your clients weather the storm
When it rains it pours, especially for home buyers looking to brave today’s housing market. But a little luck — and a whole lot of preparation — could give your buyers the edge to find their next home. Here are some tips.
Start by completing a buyer’s analysis.
Of course, you’ll ask the standard questions about pricing, number of bedrooms, number of bathrooms, etc. However, given the limited inventories, you may want additional filters.
For example, what type of neighborhoods do they like? Will they consider buying an older home (say over 30 years)? What are their favorite floor plans? And perhaps most important, what are the absolute deal-breakers?
Get your buyers to pre-qualify.
Obtaining a pre-qualification letter is a necessary step in helping your clients narrow their home search. Credit approval outlines how much house your buyers can afford, based on their income, credit, debt-to-income ratio, etc. It also determines the type of financing your clients may qualify for — conventional, FHA, VA or USDA. So, you can help your buyers avoid disappointment by weeding out the homes (or sellers) that don’t accept their method of financing.
Make sure your buyers can act fast!
Blink and it could be gone. That seems to be the way things work in today’s housing market. When you consider that some buyers are bidding on properties they’ve only seen online, and others are submitting bids that are well above the asking price, the ability to act fast is essential. In fact, your buyers should be ready to jump to a showing in just a few hours!
Encourage your buyers to be flexible.
Be realistic with your clients. With so few homes available, do they really want to hold out for a full basement? Maybe three bedrooms will work instead of four. And maybe they don’t need to live in downtown’s trendiest neighborhood.
Your buyers may also need to compromise on certain aesthetics, such as wall color, flooring, light fixtures and other features that can be (economically) upgraded or changed after sale. The more flexibility your buyers have, the better.
Can your buyers make a cash offer?
While not possible for many buyers, nothing will make your clients stand out — or assure their success — more than a cash offer. In March, 23% of U.S. homes were bought without a loan, up from 19% a year ago. Sellers debating between a cash offer or a contingent-on-finance offer will take the cash every time.
If your buyers can’t make a cash offer, the next best thing is a sizeable down payment. Meaning, one more than 20%. This lets the seller know your buyers are serious, not just kicking the tires, which puts your clients in a stronger bargaining position.
Preparation can make a difference.
Housing is an ever-changing market. No one knows what the conditions will be in a year – or even six months from now.
While the buying frenzy of the last two years has slowed, it’s still a seller’s market. That’s why buyers need the experience and expertise of real estate agents like you. Our tips can help you — help them — prepare for a challenging home search.
Real Estate Express, How to prepare your buyers for today’s hot market. https://www.realestateexpress.com/career-hub/blog/how-to-prepare-your-buyers-for-todays-hot-market/. Accessed Sept. 2022.
The Columbus Dispatch, 10 tips for navigating a difficult housing market. https://www.dispatch.com/story/lifestyle/2021/04/25/ten-tips-housing-market-buyers-homes-for-sale/7241096002/. Accessed Sept. 2022.
Forbes, 7 tips for buying a home in today’s market, https://www.forbes.com/sites/forbesrealestatecouncil/2020/06/29/seven-tips-for-buying-a-home-in-todays-market/?sh=6712543c5ca7. Accessed Sept. 2022.
Forbes, 13 essential sales tips for real estate agents, https://www.forbes.com/sites/forbesrealestatecouncil/2017/12/11/13-essential-sales-tips-for-real-estate-agents/?sh=78ea8d4c4234. Accessed Sept. 2022.