Doesn’t it always feel like the first time every time you sell to a first-time homebuyer? In many respects your job is to shepherd them through the purchasing process and hold the door open to their new home. To take your first-time buyer from shopping to purchasing requires a lot of investment, a bit of armchair psychology, and a lot of research, and you absolutely must stay on your toes. To help REALTORS® make the sale, we put together 10 tips to help you close the deal with first-time buyers.
1. If they’re on the fence, push them off: The national average in cost of rent rose significantly from 2009 to 2011 and trends indicate that those rental prices will keep rising at least through 2013. The long-term cost of renting is much more expensive than the cost of buying home. Make sure your buyer is aware of cost-savings associated with buying and owning a home.
2. Mortgage rates are at near-record lows right now: First-time homebuyers are seeing unheard of rates. The 30-year, fixed rate fell to an average of 3.87% and the 15-year fixed dropped to 3.14% for the week ending February 2, both the lowest rates ever recorded in 40 years. Point your buyers to this CNN Money article on the Freddie Mac Primary Mortgage Market Survey.
3. Be the bearer of good news: The news is good right now for first-time home buyers. Why not garner some goodwill by being the person to share the good news. Let your buyers know the reasons why now is a good time to buy, and provide valuable context to your potential clients. Part of your job is to be a cheerleader for the housing market and turn your clients into believers.
4. Today’s first-time buyers are smart: Today’s buyers are much more savvy than they were 10 years ago, when online listings were nearly non-existent. Now buyers have already done their shopping, and because the housing market has been in the news, they’re much more familiar with mortgages, property values, market conditions, short sales. Assume some level of knowledge on the part of your client, and talk up to their level.
5. Today’s young buyers grew up online: Many young buyers haven’t even used a phone book. If you want to be found, you’ll need to be online and engage in social media. Set up a website, index your business with Google, and be active on Facebook and Twitter.
6. Be responsive and ready to engage at all hours: Speedy responses are essential. Because your clients exist online in the world of instant information, they expect the same speed of response from their real estate agent. Move fast, and be on-call.
7. Distressed properties are appealing: Nine out of 10 first-time buyers are interested in distressed properties, short sales and foreclosures. Eighty-nine percent of first-time buyers are interested in distressed properties because of the perceived savings and trends in working with older properties in gentrified neighborhoods.
9. But distressed properties are intimidating: Though many first-time buyers think they want a distressed property, after viewing a few they may realize the work and money involved in fixing the property might be more than they’re willing to take on. Many buyers grow frustrated at trying to purchase distressed properties. Try showing them a few, then have a reevaluation conversation about what they’re thinking.
9. Offer a home warranty: If your client is coming from a rental property they’ll be used to calling a landlord to fix any problems that may arise with their home. Taking responsibility for home repairs can be a scary proposition. You can alleviate those concerns by offering to purchase a home warranty for them. This small out-of-pocket cost could be the final nudge they need.
10. Always remember that buying a home is emotional: Despite all the technology, all the available homes, and all the real estate know-how of your clients, buying a home is still about feel. Listen to your clients needs, and try to be truly helpful. Young buyers especially will appreciate your candor.