My monthly state of the real estate market story typically starts with Jay putting together an economist’s perspective on the market in general–nationwide, regional and local. I then jump in and personalize it with how the market is going based on what I’m seeing day to day, and how the buyers and sellers are reacting to supply, rate changes, etc.
However, Jay has been busy writing a story about dogs, so I told him I’d take care of this month’s state of the real estate market update.
Now that it’s August, I’m reluctantly referring to the ‘upcoming school year’. A pet peeve of mine is when the kids have barely gotten off the bus on the last day of school, and next thing you know backpacks hit you in the face when you walk in to Staples before we’ve even had a chance to step foot on the beach. *Side note: If you have kids in any of the local Central Massachusetts schools, don’t miss my school calendars and bus routes story.
The reason I mention schools is because a keyword when you hear someone talking about schools is ‘behavior’. Schools are full of behavior issues. We have a lot of behavior issues in the real estate world, too, and with inventory being as tight as it is, I’m seeing some of the same behaviors over and over again. Without naming names, or divulging addresses, here’s a few thoughts I have regarding some recurring buyer and seller behaviors in the current real estate market. *Actually, now that I am proofreading this story, it’s a lot of buyer behavior–maybe next will be a seller behavior story.
All of the scenarios below have crossed my desk in the last month at least once, sometimes three or four times with different buyers, sellers and properties.
If you have a buyer agent, that person IS your point of contact for all real estate questions.
If you’re in the home search process and are working with a buyer agent, that person is your point of contact for all real estate questions. Once you have an accepted offer, there will be more people who jump in to help with your loan, appraisal, inspection, etc., but until then, please go directly to your buyer agent for all questions and showing appointment requests. I had someone reach out to me regarding a new listing I have with first showings at the weekend’s open houses. Between now and then, the sellers are packing, cleaning, and making last-minute cosmetic improvements, and need that time to get ready for the open houses. This person who reached out to me wanted to get in to see it ahead of the open houses, due to an alleged very specific spouse work schedule. At the same time, a local, well-respected realtor texted me and asked if it was possible for her clients to get in to the same property to see it ahead of the open house, due to her schedule that weekend. I explained to her why that wasn’t possible, which she understood. I asked for her client’s name just so I’d make sure to reach back to the buyer agent for feedback after the open house, and I recognized it was the same person who is already texting me! I told her that, she checked back, and it turns out her mother had messaged me, pretending to be the daughter. This behavior will not help you as a buyer. Luckily the buyer agent assured me that she’s got control of the situation now, and I believe her. But you’re not helping your case if you’re going rogue on your realtor, even if it’s only in the name of ‘helping’. To me, that behavior is an indicator that you could go any direction during a transaction.
If you don’t have a buyer agent, you should!
A good buyer agent will keep up to date on active listings, new listings and sometimes they have access to intel on upcoming listings that aren’t active yet. This person will help you strategize as a buyer, so that you have the best chance of getting your offer accepted. There are many strategies that are used by buyer agents, based on their experience. Unless you’ve already bought a house in the last 6-12 months, you aren’t likely going to come up with those on your own. Do you think you could be best served by connecting with a buyer agent who can get you ready-ready for the current real estate market conditions? Connect with Lisa Saulnier. Lisa works with me on my team, and she’s a 7 day a week buyer agent, with a great success rate of having her clients’ offers accepted throughout the past few years, continuing through now.
Lisa Saulnier, Keller Williams North Central
lisasaulnier@kw.com
978 790 7591
Throwing out low offers isn’t typically a winning strategy.
I was meeting with a potential seller yesterday and she asked me what we’d do if they get a low offer on their house, under their reasonable listing price. I explained to her that with the number of buyers out there looking for homes now, and because there aren’t enough realtors for a 1:1 ratio of buyers to buyer agents, it’s possible we’ll see the same buyer agent listed a few times with different buyers when they sign in at our open houses. When my team meets with a new potential buyer client, we talk about the current real estate market conditions. If a buyer tells us that their plan is to roam around and throw out low offers, we suggest that they pay attention to current active and under agreement listings in the price point and location they are searching for a home in. We encourage them to keep track of listing price, what they think the house will sell for, and then the eventual sale price. If someone insists on putting in a very low offer, we call the listing agent to get a gauge on quantity and quality of offers on that listing. We talk with the buyer, and most times they will recognize that their proposed offer wouldn’t compete.
An alternative to that is buyers who just don’t want to pay more than they are comfortable, could take a look at properties in their general price range that have a mounting number of days on the market. They still aren’t going to steal the property, but maybe this is a chance to get an accepted offer with some contingencies that they wouldn’t likely have success with on a ‘just listed’ home. For instance, if they have a home sale contingency, or a loan type that has additional requirements, these buyers often have more success with homes that have been on a little longer.
Work with an awesome lender, and ask them to get creative.
My oldest stepson is currently in the process of buying his first home. Paying 100% in rent finally got to him, and we found a sweet property for him. He’s working with the world renowned Denise Peach of Total Mortgage, who was immediately recognized by the listing agent, which made getting his offer accepted that much easier. Denise crafted a scenario for him that includes a buy down of his interest rate, so that he doesn’t have to plan to refinance the mortgage when the rates are lower. He knows they aren’t going to be in the 2’s again, and is now comfortable with his payment and his interest rate and he understands, from working with a top-notch lender, exactly what his options were, so that he could make an informed decision on how to move forward.
Denise Peach, Total Mortgage
dpeach@totalmortgage.com
978 807 3370
Don’t throw everything including the As-Is Kitchen Sink in to your offer unless you mean it.
Waived inspections, offers to pay seller closing costs, buyers bringing extra money to the transaction if the appraisal comes in low…it’s unfortunate for buyers who offer with normal contingencies that there are also high dollar, no inspections, etc. buyers who get to the front of the line. However, I recently had a listing where the buyer come to the final walk through of a home she was in contract to purchase, ON THE DAY OF THE CLOSING, and decided she wasn’t buying the house. If you choose to waive contingencies, know that this isn’t something you can arbitrarily walk away from if you change your mind midway, without the risk of financial consequences. Again, there are strategies you can use to assure the sellers that you will be a reasonable buyer throughout the home purchase process if you aren’t comfortable throwing everything in.
It’s still a great time to buy, and for sellers who have a plan for where they will be going, it remains a great time to sell.
I recently saw a post on Lana Kopsala’s social media, sharing news that her son had just bought a home in Westminster. If you don’t know Lana (impossible), she is a local rock star of a realtor, and I love working with her. So, her son just bought a house in Westminster, and my oldest stepson is in the process of doing the same. Clearly, we both think homeownership is a great investment, or we wouldn’t likely be encouraging our own kids to do it right now.
I’m always happy to brainstorm the state of the current real estate market. There are always people buying and selling. When’s the best time to move? When you need to–and there are always people in that position.