In today’s highly competitive real estate market, first-time homebuyers need more information and assistance than ever.
From high-interest rates to a lack of inventory, it’s harder than ever for first-time buyers to find the right home. Even so, there’s much you can do to help your first-time buyers make their dream of homeownership a reality.
Agents must overcome two primary challenges when working with first-time buyers: finding properties to show their buyers and then making sure they are “purchase ready.”
Locating the right properties to show your first-time buyers
Where should you look to find properties that are not listed on the MLS? While the competition for expired listings and For-Sale-by-Owners is fierce, here are some great alternatives.
(Please note: Before showing any property that is not currently listed, always obtain a one-party-listing agreement before introducing it to your buyers.)
1. Hold seller seminars
You’re probably familiar with buyer seminars, but have you ever considered holding a seller seminar? Marriages, divorces, and deaths usually result in changes in property ownership. Given that over half the population is living paycheck to paycheck, financial difficulties may force another large group of struggling homeowners to sell as well.
Potential topics that may attract these potential sellers include “Understanding Your Home’s Value” or “Preparing Your Home for Sale.” Market your in-person or Zoom seller seminars through your print, digital, and social media marketing.
2. Engage the 58% of buyer leads with properties to sell
According to the most recent NAR Profile of Home Buyers and Sellers, 58 percent of the buyer leads (and 77 percent of repeat buyers) own a home. Consequently, follow up immediately on all buyer leads to determine if they also own a home. If they do, schedule a face-to-face appointment as soon as possible. According to NAR, the first agent who meets with a potential seller face-to-face when they’re ready to transact gets the listing 80 percent of the time.
3. Heavily prospect the 55+ market
The NAR Profile also found 65 percent of ALL sellers are 55 or older. Seniors are often forced to move due to financial issues, the loss of a spouse, mobility issues, or their inability to no longer live independently. Take the following steps.
Tailor your print and digital advertising to focus on the issues that force seniors to sell their current homes. Market by discussing “right-sizing” rather than downsizing.
Make their move as easy as possible. As my last listing agent told me, “All you have to pack is clothes — I’ll handle the rest.”
Familiarize yourself with the 55+ independent living communities in your area. Most of these communities have ongoing events that include holiday parties, speakers, local artists, and musicians. Consider regularly sponsoring these events, so that you become known as the realtor who really cares about your community. Remember, being face-to-face is crucial.
4. Tap into the 15 million vacant homes
Kurt Carlton, the president and co-founder of New Western, the largest marketplace for investors who want to flip, rehab, or invest in housing, discovered an interesting statistic in the 2020 Census: there are 15 million vacant homes in America.
While some of these homes are Airbnbs and second homes, Carlton’s data suggests that a substantial portion of these are inherited properties owned by out-of-area owners. Many of these owners are working so hard to keep up with inflation, they don’t have the time or the money to deal with the needed repairs.
A great solution to this issue is Curbio, the nation’s “leading pay-at-closing home improvement solution for real estate agents and their clients.” Curbio prepares the property for market and then deducts the closing cost.
5. Explore lesser-known neighborhoods
Encourage buyers to view homes in up-and-coming neighborhoods, redevelopment areas, new subdivisions, or areas where major retailers are building new stores. In many cases, they may find more affordable options, especially if builders are offering mortgage rate buy-downs and hefty upgrade packages.
6. Prospect ‘lease expired’ listings
Lease expires can be an excellent source for locating owners who have multiple properties. If your MLS provides this data, search for properties that were leased or expired 8-10 months ago. Because most lease agreements are for one year, these properties may be coming back on the market in the next few months. If the owner has had a difficult tenant, the owner may decide to sell. The tenant, on the other hand, may also be ready to buy.
7. Search active ‘For Rent’ listings
Websites that list “For Rent” listings include Craigslist, HotPads, Realtor.com, Trulia, and Zillow. You can also check Oodle.com and Facebook Marketplace for their rental sections.
Be sure to check with your local title company as to who owns the property. The reason? Investors typically own multiple properties. You never know when that owner may want to sell or do a 1031 tax-deferred exchange.
8. Co-market with local businesses
Partner with local businesses to offer exclusive discounts on services for both buyers and sellers. This can include appliance stores, gyms, handymen, hardware stores, landscapers, local restaurants, storage units, etc. This type of marketing creates a win-win situation for everyone involved.
9. Network with other professionals outside the real estate industry
Connect with local professionals such as accountants, attorneys, contractors, financial planners, landscapers, movers, etc. They often have inside information about homeowners who may soon be putting their homes on the market. Look for ways you can support them in their businesses.
By Bernice Ross
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