Buyers Clueless or Liars?

This article is about real estate buyers and their agent's status. If your buyers aren't really telling you the truth about what type of home they want or can afford, it could be because they don't trust their agent with the knowledge. Unfortunately, it's true in many cases. If the buyers aren't convinced that you will work in their best interests with full knowledge of their situation, then they won't tell you everything, everything you need to know. Before any homes are shown, your goal should be to build a high level of trust with them that will allow them to be open and honest with you and give you all of the information you need to help them. This isn't always possible, as there are a lot of people out there who don't trust anybody. But, it's best for you and your buyers to get to the highest level of trust possible.

 

Here is an example from a agent selling Collin County Homes who came into the market after being a tire kicker, subscriber and searcher on his website for years. At last, the timing seemed right, but the buyer was in the lowball offer mood, and there was a lot of difficulty in getting him to see the problem unrealistic offers present, even after two had already resulted in hard feelings and burned bridges with sellers. You would think that now this agents blog site was a good one, holding this buyer on his list for more than two years. This agent did a lot of market statistics and commentary that illustrated a great deal of market knowledge. So, what is the problem?

• It took several failed offers before the buyer finally decided that the time wasn't right to buy and he left.
• This buyer had previous poor experience with buyer's agents in other areas.
• He held a belief that all real estate buyers agents were after the commission first, and serving his needs second.
• The market was slow and the real estate buyer refused to believe that this area wasn't full of motivated sellers ready for any offer.
• The buyer's broker tried to gently lead the buyer to the knowledge that would help them to see their interests were at the top of this agent's list.

Was there no real desire for this buyer to buy because he was also interested in Tarrant County homes and Denton County homes as well? This wasn't the case, as it was a long drive to get to this area, and the buyers did some intensive online studying before making the trip out there. It was only because this buyer believed that the agent couldn't be trusted when he was telling them to raise their offers and posting higher earnest money deposits that they would need, and other facts about that specific market and homes that would help them to actually successfully make a purchase. Work on trust first, and you may find it a pleasure to work with buyers who respect your opinion and truly consider your advice. The clueless part isn't just as regards the first time home buyer. Many experienced buyers who have done multiple transactions in their lives will still not have market specific knowledge that can hurt them in their search for a home.

• Even specific knowledge of how certain listing brokers handle their negotiations on behalf of their sellers
• Local custom as to earnest money and offer presentation.
• Market conditions, absorption rates, and local market trends.
• Specific area knowledge that dictates very different home prices in areas not that far apart geographically.
• Quality information as related to specific builders or subdivisions.

Owning a Home - Cheaper Than Renting?

Across the country, at today's sales and rent prices, buying is cheaper than renting until the 30 year fixed rate reaches 10.5%. The recent rise in interest rates has made buying a home a little more expensive. The recent increase in the 30 year fixed rate raised the monthly payment on a $200k mortgage by $56, or 6%. However, because mortgage rates are still near historic lows, and because values fell so much after the housing bubble burst and remain low relative to rents, owning a home is still much cheaper than renting one. What this means that the recent jump in interest rates doesn't change the rent versus buy calculations very much.

Mortgage rates may keep rising, but how far must rates rise before buying DFW homes start to get expensive relative to renting? Answer; take the latest asking prices and rents from April, May, and June 2013. Following the standard approach calculating the cost of buying and renting for similar sets of homes, including insurance, insurance, taxes, closing costs, down payment, sales proceeds, and, the monthly mortgage payment on a 30 year fixed rate mortgage with 20% down and monthly rent. Most folks will stay in their Plano homes for 7 years, deduct their mortgage interest and property taxes at the 30% tax bracket, and get modest appreciation.

 

 

Buying Dallas real estate remains cheaper than renting as long as interest rates stay below 10.5%. At 3.9%, the current 30 year fixed rate according to Freddie Mac, buying is 41% cheaper than renting across the U.S. at a 5% interest rate, buying is still 34% cheaper than renting. Mortgage rates would have to rise a great amount, all the way to 10.5% to change this to make renting more favorable than owning. Rates were about that high through most of the 1980s, but have been consistently below 10.5% since May 1990. Each market area has its own mortgage rate tipping point where renting becomes cheaper than owning a home. At 3.9%, buying is cheaper than renting in all of the 100 largest metros areas, which means the tipping point is above 3.9% everywhere.

The tipping point also depends on how long you plan to stay in your next home and whether you itemize your tax deductions or not. If you don't itemize, or if the mortgage interest and property tax deductions were eliminated entirely, buying would still be 29% cheaper than renting at an interest rate of 3.9%, and the tipping point when renting becomes cheaper than buying would be at a 7.5% rate. Just because buying is cheaper than renting, it doesn't mean you can buy. Many folks who want to buy don't have enough down payment or have poor credit.

 

 

If the recent increase in interest rates doesn't change the rent versus buy equation substantially, why does it matter? The main effect is reducing refinancing demand. Unlike home buying, refinancing is a relatively straightforward financial decision: although refinancing has costs associated with it, refinancing doesn't require someone to find a home or move. Since rates have been low for so long, many people who were able to refinance, already have done so. For folks who haven't refinanced yet and for people looking to buy a home, rising rates do make housing more expensive. Rates are on the rise and are may keep rising, thanks to the strengthening economy. But it will take big rate increases to turn off prospective home buyers. At today's prices and rents, rates would have to rise to levels we haven't seen in 20 years before renting is cheaper than owning a home on average across the country.

4 Ridiculous Real Estate Seller Sayings

Volatile emotions give rise to a few seller sayings that seem simply silly when seen in the right light. Here are some examples, along with insights to help you ensure you don't let them confuse your home selling decisions.

1. We need to find buyers who understand our tastes. There are certainly occasions where there is truly a narrow niche of buyers that will have to find, understand and appreciate a particular house. In cases like this, with acreage, converted garages, horse properties, etc, this saying is not ridiculous at all. But this saying is absolutely ridiculous when it is said by the homeowner with potentially wide appeal as a reason for not staging or preparing their home for sale, or in the effort to avoid neutralizing highly and de-personalizing their design and decor choices. When it comes to buying Dallas foreclosure property, however, these things are not an issue because you get what you get when looking for a great value in a home.

If your home has been sitting on the market while the others are selling and your agent has suggested that you tone down the bright orange paint job or delete the forest mural on your dining room wall, think about how much time and money your decision to wait for the buyer who understands these design choices is really costing you.

2. But I spent a lot or years or a lot of money on that. The ability to customize your home to your personal tastes and your family's wants and needs is one of the biggest benefits of home ownership. Owners are encouraged to make changes to their homes that will improve their quality of life while they live there, rather than focusing on whether they will be able to recoup their investment when they sell it 15 years down the road. Not only were they not willing to pay a premium for it, they planned to rip it out and replace it with low-maintenance, low maintenance landscaping.

Give it up. When it comes to selling DFW real estate understand that other than the kitchen, bathroom, amenity and decor upgrades that appeal to many home buyers, if you have invested your time and money in customizations and upgrades for your personal enjoyment, then your enjoyment is the return on your investment. If your home's eventual buyer also happens to love them, fantastic! But don't approach the home selling process expecting every buyer to share your value system and pay through the nose for them. If you do, in just a few month you may find yourself selling your house to one of those I buy houses companies and selling at a discount.

3. I want to price it high, so I have room to negotiates and come down. When the market is slow enough that buyers are routinely paying below asking for homes, pricing your home above market value is actually dangerous. You run the risk of causing no one to even come look at your home as a good enough value to see it in the first place.

If other home sellers are pricing appropriately and yours is priced too high over many buyers won't even bother trying to negotiate you down. They will simply go find one of the homes on the market with a more realistic price, they'll wait until you lower the price or they'll wait until your home has been lagging so long they sense you might be a motivated seller. Even in a strong market like we are in today the aggressively priced homes get the most buyer traffic and get the most offers. This causes bidding wars and drives the sales price higher. Overpricing it might actually sabotage your success.

4. That offer is an insult - I will just reject it. Your home is very personal to you. It represents a large investment of your money, time, memories and dreams. But once it's on the market, grow some thick skin and decide not to take anything personally, it's just business at this point. If a buyer offers to pay so many thousands of dollars for your home, it's not an insult, even if the offer is far lower from what you are willing to sell the house for. They might be uneducated or misguided and not yet experienced enough in the market to know that their offer was unreasonable. Or they might just love your home and be going all out to get it, even though it's really outside of their scope of affordability. Also, they may be just trying to get you to come down some on the price.

You should always respond to any offer made by a qualified buyer. If you have another offer or offers that are more realistic, just respond with a nice decline to accept. If you have no other offers, respond with what you and your agent agree is an appropriate counter. You might be surprised at how even a very low offer can come together with a respectful, reality based counteroffer and a little negotiating.

How Much Money Should You Budget To Buy a Home?

You have made the decision to buy a home. Have you truly budgeted to actually afford a new home and have the money to move? When you meet with a loan officer, they will determine how much you can afford based on your credit worthiness. Just because you are approved for a certain dollar amount, does not mean you should buy at the top of your price range. The strategy to determine how much you can afford is to work backwards. Start with things you like to do and start tallying up daily expenses you occur and figure out what you can live without. Then work the other direction from your income and determine what you would be comfortable spending on housing. If you rent now, you are probably comfortable with that monthly expense. Usually home ownership will cost $500 more per month because you will have new expenses that you probably don't have now like taxes and additional insurance. Also factor in new purchases like a refrigerator, washer, dryer, and lawn mower.

 

When you think about purchasing a new home, we often forget about expenses it takes to actually purchase the home. Be prepared to get out your checkbook and write out 5 checks once you have an executed contract.

1. The title/escrow company for the earnest deposit

2. The seller for the option money

3. The inspector

4. The appraiser

5. Cashier's check for the remaining balance of down-payment prior to closing

 

When it comes to buying either Denton County real estate or the much sought after Collin County real estate the first 2 checks you will write will be for the earnest money and the option money. The earnest money is the money you deposit into an escrow account with the title company when you have found the home you want to purchase. The amount of the earnest money is usually around 1% of the purchase price. Treat earnest money as showing good faith to the seller that you have the money to purchase their house. The next check you will have to write is to the seller for an option period. It's usually anywhere from $100-$250 depending on the price of the home. That is the money given to the seller for them to take the house off the market while you get the home inspected. During the option period you decide if you want the home based on the inspections and remember, you can walk away if you don't like the house any reason; the seller keeps the option money.

 

As a buyer of Tarrant County Real Estate treat that money like your down-payment. Your loan officer will tell you how much money to bring to closing. The next check will be for the inspector. The inspector will inspect the house inside and out telling you if there are any major defects with the house. The cost of the inspection can vary based on the size of the house and costs around $400. The next check is for the appraiser. The appraiser works for the bank and will determine if the house is worth what you are purchasing the house for and costs about $400. Lastly, once you have determined you are moving forward with the purchase, you loan officer will tell you the amount of money you will need to bring to closing to make the actual purchase of your home.

Buying a house is exciting, but also scary when it's something new. Your real estate agent will guide you through the process, but it's nice to know ahead of time what to expect and how much you will have to pay during the process, so you can budget and be less stressed during the home buying experience.

~ Jennifer Clark VIP Realty Platinum

Ways to Get Found by Home Sellers

The year is more than halfway over, but there’s enough heat left in the market to make this the year that you take your real estate business to the next level. To do so, you will need to provide great client service and a great lead plan. Before you can put either of those into action, you need to make sure you are getting found by the seller clients that mean the most. A serious seller prospect is one of the most sought after commodities there is. Here are some strategies that can help land you your next listing. Even if you are just looking at DFW real estate careers you will find these ideas helpful in any business.

1. Get Vocal:

Potential home sellers aren’t just looking for signs that you are in the business. They want to know you are an expert in the business. Only having a profile, license, or website is not enough. Sellers want to see your expertise in action. Every day prospects are posing real estate questions that signal they’re serious sellers asking real questions like “Who is a Good Realtor?“.” and “How much should we spend renovating?“ That’s why you should study the neighborhoods you want to grow your business in.

2. Get Focused:

Sellers want to work with the agent they know who knows their market and the places where consumers realize they need an agent are many. Many times it’s an offline experience that makes them go online to find an agent. The reality for agents is that you have to live on multiple platforms. But, multiple platforms certainly doesn’t mean you should have multiple personalities. Having a focused presence online can give the same effect as the 25 yard signs and a billboard offline. I am talking about multiple placements, but only one personality. A good would be those We Buy Houses companies. Here are some target areas to make sure stay consistent everywhere you market:

Specialties – We know you can do it all, but show prospects the ones that reflect the business you’re after.

•             Service Areas – Make sure these are where you actually want to work. Whether it is selling Tarrant County homes or otherwise, you will end up with leads and prospects that ultimately need another agent, one that has expertise in their area.

•             Your Message – If you truly want to take over a neighborhood or niche, being repetitive is the best way to go about it. Research shows that people only retain about 10 percent of what they read and about 30 percent of what they hear. Say it, say it again, and then say it to the same audience some other way.

3. Real Information:

You should never just send a bunch of numbers out and assume your perspective clients will know how to interpret them. The right formula is to offer important data points and helpful analysis. While sharing, marketing, and creating information to generate new business, remember to add some color for your sellers. Don’t just add market data. Think about the key data points that provide key insights that are really going to motivate your sellers to list with you, like

·         Do your listings sell for more than other listings?

•             Do you sell homes faster than other agents?

•             How many transactions have you closed with similar homes?

4. Provide Proof:

Sellers are searchers of information and what they find will make or break your opportunity to list their house. Dollar figures, awards, and client accolades are great resume builders, but the key indicator that matters most to the one client looking for help with that one transaction is: “Can you close my transaction?” You can answer the question before you have your first client meeting.

5 Power Moves to Attract Your Next Sellers

How do most real estate agents ask what does it takes to win seller clients in real estate? The answer usually involves effective marketing, commitment to being the best you can be and confidence in your abilities. But there’s more. To really succeed, you have to be a self motivated self promoter. If you learn to do it right, there are many opportunities to take your business to the next level in your local market to make sure the pool of home sellers never dries up.

Below are five things that you can do right now to connect with your next seller clients.

 

1. Follow up, Follow up, Follow up:

There are too many agents, clients, title officers loan officers, and other partners who wash their hands of one another once a deal is closed until it’s time for the next closing. A great post closing follow up program for our clients goes a long way toward connecting with new clients and developing repeat business. This is at the top of the list when it comes to Dallas real estate careers. Focus on the following points:

 

1. If you really want to be someone’s real estate agent for life take a few minutes to follow up via phone to see how they are enjoying the new home. While talking with them never fail to remind them that you are happy to help any friends or family they know who are looking to sell their homes.

 

Congratulate them on the internet. Buying or selling Plano real estate is big news. You can give them their own headline on social media or your website. Check your seller’s social media comfort level, and if they are savvy and comfortable sharing, doing so is a great way to expand your network.

 

2. Separate yourself from the rest of the pack:

If you can’t answer why you are in real estate, your prospects won’t be able to either. This is what sets you apart from the rest of the agents in your market. Knowing “why” it is critical for creating your niche and becoming a powerful agent. It also makes marketing much easier. When you answer the “why” question, you can make the call on what your ads, billboards and online marketing should say. Don’t just focus on the clients you want. Figure out who is in the clients you already have. Growing an existing audience is much easier than building a new one.

 

3. Sell your success:

It’s easier to convert a potential seller into your client when they’ve seen the proof that you can sell. Make sure your sold listings are seen online by as many people as possible. If you are an expert in selling Dallas foreclosures let everyone know. If you’re not showing your transaction history online, you’re just giving buyers and sellers a reason to pass you up.

 

4. Be careful what you post on the web:

These days a big portion of business comes from social media. Even direct messages and Facebook chats about doing business, eventually most people will end up on your website.

 

Look at your website and online profiles to find out if you are saying the right things. Make sure that the contact forms and buttons aren’t hidden throughout your site A little bit of time spent improving your presence online can go a long way toward bringing in new business.

 

5. Find the next hot real estate niche and market to it now:

When it comes to attracting clients, it’s not always about what happening now. Thinking and being ready for what’s next is one of the best business investments you can make. What are some trends going forward? Multiple offers today means the market’s making way for previously reluctant sellers to jump in.

 

Ask yourself:

•             Who in my market is “not quite ready” to buy or sell? And, why?

•             What’s the biggest trend in the market right now and what’s the inverse?

Finding needs and marketing to those niches has been a great way for us to generate new business both in the short and long term.

 

6. Connect with the busiest real estate agents you know:

In this business, no agent starts out a power agent. If you’re new and/or find your seller pool is starting to dry up, connect with the busiest agent you know and ask about referrals. When we’re busy and can choose which clients we work with, the ones we don’t have time for still need an agent. If you really want to build more business, don’t be afraid to be an understudy for the movers and shakers in your market.  

Getting Your House Ready To Put On The Market

Today's buyers are very savvy and want to see homes in near perfect condition. Thanks to many shows on HGTV, buyers have come to recognize and appreciate homes that are move-in ready. With inventory on the low side, sellers think they can put their home on the market without doing anything to it. Although, if priced right their home will sell, but if it's properly staged it could sell for more than what it was listed for.

In the DFW real estate market we are seeing multiple offers and bidding wars on good homes that are well maintained. If that is any indication to potential sellers, it's worth the extra time to really get your house ready prior to putting your house on the market.

Here are the first 5 things you should do first before putting your Collin County home or Denton County home on the market.

 

 

1.Clean and de-clutter the house. Start 3 piles. 1. Keep, 2. Donate 3. Throw away. The garage is the best place to start. Have a garage sale.

2.Are there things that are seasonal or things that you are not going to use? Pack them up and start staging the garage with all your boxes. The potential buyer knows a garage is a garage without needing to see the open space unlike a cluttered living room that you are hiding the fireplace with your big furniture and clutter.

3.Complete unfinished projects. Did you finish painting the room you started 2 years ago? Are all the cracked tiles replaced that you had planned on replacing? How are your carpets? A good steam cleaning will make a huge difference. Hire a handy man if you aren't good with home improvement projects.

4.Take down or put away all your valuables and things you plan on keeping. If a buyer sees it, they will want it. Swap out those more expensive appliances with something else if you don't want there to be any confusion about what is staying or going.

5.Focus on the outside curb appeal. Are the weeds pulled, are the trees trimmed, is your garden planted, and is your walkway clear from debris? Also, clean all your exterior windows. That makes a huge difference especially right before getting photos of your house to start marketing it.

 

 

Once you have completed those 5 steps, then you can have a professional stager and real estate agent help you with getting your home on the market. Don't get too eager to put your home on the market when it's not ready. Homes sell fast when they are polished and shiny. Get top dollar for your home and create demand among buyers.