Great Housing Expectations

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We all know that over the past few years, sellers have had a very hard time coming to grips with the fact that their home has probably lost considerable value. But what are buyer’s expectations like in our current market? Do they really think that they will find a luxury estate in a posh neighborhood for $50K? The answer is YES.

However, while they’re going to get a better deal than 3-5 years ago, there are limits as to what your dollar will buy you. The old adage “you get what you pay for” still applies.

What can agents do to better prepare and educate their buyers about the housing market in metro Atlanta?

  • Learn current trends within their service areas. Last Sunday’s Atlanta Journal-Constitution had an article on the front page that detailed the sales rate and price range ratios done by zip code in metro Atlanta and the week prior listed the top schools. Trends such as these help to explain why a home might be higher priced rather than using broad economic conditions as an indicator. Hang on to these articles to help educate customers.
  • As you narrow down communities, show the customer all the current trends, as well as CMA data to point out pricing in each community.
  • Explain neighborhood differences that would show why a similar house in 30062 might have a higher price point than one in 30127. Both zip codes are in Cobb County but location, school test scores, foreclosure rates and sales data might mean making the most suitable offer that fits the customer’s lifestyle and budget.
  • Educate your customer about how banks, foreclosure companies and relocation companies price their inventory to sell and that their bottom line does not have as much wiggle room as a home with an owner living in the property. We are seeing bidding wars on all of these types of properties in the past few months.
  • Another trend affecting how much house a buyer can get for their money is that many transferring sellers may opt to rent if they can not get a reasonable price for their current home and will rent in the new location. They’re waiting for an economic recovery and are hoping to take less of a loss on their property. There is not much dealing a prospective buyer can do here.
  • Don’t forget to warn the prospective buyers that sometimes what looks like a great bargain may not be in their best interest to buy. The best way to make sure you don’t end up sorry is to thoroughly investigate the property, neighborhood and community. Is it a diamond in the ruff or fool’s gold? I can’t say enough about how market trends may affect the future of any property in the marketplace.

The change in the pricing of homes is a weekly occurrence. Keeping up with housing trends is vital to customers getting the most house for their dollar without regretting a decision later down the road.

Do you have any other tips to educate buyers about the market?

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5 Responses to “Great Housing Expectations”

  1. Greg Barnum Says:

    Agreed. It’s not the market of 2, 4, 10, or 30 years ago, but it’s still a market.
    Today’s Buyers are especially fidgety–very reluctant to stick with even a bargain contract–because they suspect the $500K-house-for-$50K deal is somewhere just over the horizen. It can be hard to give up on one’s urban myths. Just keep pointing out to them that fantasies are nice but that, in fact, it’s still a market.

  2. Mary Ann Varner Says:

    Great article Dana! Greg, you said it…buyers are fidgety…always feeling they can be missing out on a better deal. As we educate the buyer more, they are beginning to realize that if they focus on buying a “home” they will be happy with rather than a “deal” (they may not be able to live with), their home finding/buying experience will be more successful.

  3. Bridgette Freeman Says:

    An expectation for agents should be to collect a retainer fee from buyers. It’s a great screening process to see how serious your buyers are. Sometimes buyers will secretly admit what they wanted was impossible to find. If you get a retainer fee, at least convincing them to be realstic is not costing you valuable time and money.

  4. Bob Morrison Says:

    Great advice Dana. Another thing I think we often fail to promote to our clients looking to trade up in this market is that this is a good time to do just that. Most folks in this camp focus solely on the money they will lose on the selling side without considering the savings on the buying side. Often they can make up the “lost” equity on the buying side and come out with a “net” equity gain. That will sure take the sting out of the loss on the sale of their home.

  5. Barbara Dixon Says:

    All good advise. Articles like that help to show how informed we are and professional enough to have as much information as possible at our finger tips. I am sorry that I missed that article last Sunday, and was not able to find in their archives, but thanks.

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