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This week's article is a recent blog by Paula I. Hathaway, SVP, Prudential Douglas Elliman Real Estate, Southampton, NY; all content & information is original to Ms. Hathaway.
In this very challenging real estate market, I thought it would be interesting to look at which agents are making deals come together and which agents are failing to make it happen. This is the most difficult time to make deals come together in this profession; so lets look at the facts. "Sifting the chaff from the wheat"...that's what I call the latest trend in real estate sales. In my opinion, there are 2 kinds of agents out there: Those who do not fully understand what is really going on, who are still wallowing in the housing crisis; and those who have seen select segments of the market improve and have taken the position of informing anyone they work with--either buyer or seller, of these improvements. These agents have developed a system of what I call "Inform/Perform" and it is the way to get deals done now.
Those thinking that it is still a "Buyers Market" seem to think that National reports on falling prices applies to all markets--not so! In many markets, prices are slowly inching up and if a buyer doesn't step up and pay the price, someone else will surely do it! THE FACTS: Prices have stabilized in many segments of the real estate market and are starting to shift upwards....Inventories are narrowing as prices have reached the lowest levels in years and sales took an upward trend in many markets.
The older, more distressed houses that are selling right now are those that have been priced at the lowest levels in order to move them. It is working, and smart investors are fearless when it comes to buying these homes--the potential is tremendous for new development in these properties....builders are buying these homes, sometimes in multiples, in order to be in a postion to build when the market normalizes.
The areas that are still suffering are those feeling the after-effects of foreclosure--healing in these areas has been stifled by the negative affects on prices of neighboring properties. LET ALL AGENTS BEWARE: This is when you will be making a lot of money in real estate if you catch on to what is happening out there in the real world..Even though the real estate market remains shakey after the devastation of the recession, many investors and first time buyers have been buying and reaping the rewards of long term investing. These are the homeowners who will remain in place for many years and do not want to "flip" or even consider when they will be ready to move on. THE TREND RIGHT NOW (As I see it) Who has the money to buy a house right now?...All of those who have never bought one before--the Gen Y population!!...the Echo Boomers! They still have jobs--never lost theirs. They were cutting back and saving during the Great Recession. They have saved a lot of money!!! They are secure in their jobs and have never suffered from the setback in housing because they had no house to lose! THERE ARE ABOUT 51 MILLION IN THIS CATEGORY. The next part of the population who are spending their money on real estate is the Baby Boomer who never splurged during their lives --just saved and move along in the system with a modest home, raised their families and now they are alone--as a couple or single. This segment of the population has money to spend because they never spent it before! They are looking to help out their adult children to have a home for the first time; they may even want a new home themselves--with plenty of room for an extended family member, like an aging parent. This category of buyer has been waiting for this moment--when they can buy a house at a price that they know they may never see again. This is the moment--the time that homeowners look back and say:
"I should have bought that house in 2011!!!"
OR:
"I am so happy I bought back in 2011!!!"
This does not happen by accident!--You can't force someone to buy now--you must have the know-how, the experience and the expertise that is necessary to make it clear to your buyers that they must act now or they will lose out!
KNOW-HOW--a way of organizing yourself to be prepared for the objections you will face from your buyer. ANY OBJECTION CAN BE OVERCOME! EXPERIENCE--not necessarily a long time in the business; we start getting experience with each deal and the wise learn EXPERTISE--comes from your focus; your focus on the specifics of the market, like: what is selling, who is buying and what they are buying; what are the trends? Do you read every report you can get your hands on regarding the business? Expertise can be built! It takes all the above attributes in order to win in this market--if you don't have it, seek out the helpfrom the more senior agents...they know and they are making money. If they are not selling houses right now then they have no idea what is happening and should have left the business a long time ago!!! THESE ARE THE TIMES THAT WILL BE TALKED ABOUT IN PERPETUITY!!! THOSE WHO MAKE IT NOW WILL HAVE A LONG AND LUCRATIVE CAREER IN REAL ESTATE--- BE THE WHEAT!!!
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