Spring is a busy season for home buyers and browsers. Warm weather, longer days, and a surge of properties on the market spark interest among serious and prospective home buyers. Weekends are ideal for open houses and exploring neighborhoods. Your time is precious, and serious home buyers–and sellers–need your attention to tour properties and negotiate contracts. So how do you prioritize your clients, while providing the best service possible?
First-Time Home Buyers
According to a 2003 study by the National Association of Realtors, 40 percent of home buyers were first-time purchasers. With this, buyers often feel a degree of uncertainty with the process and decisions related to cost, location and their long-term needs. Buyers in this group are looking for a real estate agent who can remove the intimidation of buying a home and instead provide their clients with a thorough understanding of the buying process. Depending on their motivation, first-time buyers will join either the category of home browser or home buyer.
The Home Browser
Home buyers often have several different motivations: a growing family needs more space, increased financial power affords a more expensive home, employment relocation, or downsizing for empty-nesters and retirees. Some buyers just want a change. The latter group is most likely to become home browsers–those clients browsing properties with no motivating factor other than a potential change in their lifestyle.
The savvy Realtor will not discount home browsers. Rather, establish a strong rapport with the clients and help them to:
- Create a wish list of features they want in their next home.
- Select neighborhoods to target in their search.
- Identify a realistic timeframe in which a move can happen. This may require planning for the sale of their current home.
Home browsers typically enjoy attending open houses where other Realtors are anxious to gain their business. Encourage your browsing clients to visit open houses on their own time, yet ask that they communicate to other Realtors that they are currently working with an agent. This response also removes any added sales pressure on your clients during the open houses. Follow up with your clients for feedback on their visits. This data will contribute to the client’s wish list and your effort will create a valuable client touch point.
The Internet is another way your clients can browse current home listings at their leisure. According to the National Association of Realtors, 42 percent of buyers use the Internet frequently as part of their home search. This trend is growing and empowering clients during the pre-sales process.
The Home Buyer
Home buyers have a specific task: to purchase a home. They are committed to the process and look to the real estate agent to find the right home within their budget. This relationship requires time, and is a good investment for the agent. Patience is key, as the typical buyer will walk through 10 homes and search for eight weeks before finding the home they ultimately purchase.
The Buyer’s Agent as a Trusted Adviser
The agent-buyer relationship is based on trust. With this in mind, it is the role of the real estate agent to:
- Advocate and plan according to the buyer’s needs, beginning with an analysis (and wish list) of the buyer’s complete home needs, neighborhood requirements and price range.
- Listen to buyers’ comments when previewing properties. The result may be an adjustment to the client’s list of preferences and may lower–or raise–their price range.
- Encourage clients to use the Internet to browse new properties before a visit; however, do not rely on the client to perform the research alone. While most buyers (more than 65 percent) will use the Internet as a source, agents have access to the more-detailed MLS (multiple listing service) listings and are expected to advise on those listings. Combine your research efforts for a stronger presentation of options and reassure your client that you are continually looking for new listings that fit their requirements.
- Offer negotiation is the final, yet possibly the most important, step in the buying process. Look for ways to negotiate in your client’s favor, keeping in mind competitive, financial and timing factors.
Financials of the Committed Home Buyer
Clients preparing to purchase a home will want to put the following financial items in order prior to submitting an offer on a new home:
- Pre-approval of mortgage: Mortgage rates are fluctuating. It is important for buyers to find the right combination of mortgage rate and house price that fits their financial capabilities. Most mortgage lenders are making it easy to receive pre-approval on a loan, even through a 15-minute telephone call. Pre-approval does not commit the buyer to working with a specific mortgage lender, but it does create confidence that the buyer is qualified to purchase a home within a specific price range. Buyers who are pre-approved typically represent stronger offers.
- Sale of existing property: For home buyers who also need to sell an existing home, the process can feel complicated in terms of timing and financials. Buyers in this scenario look to their agent(s) for a plan that reduces the risk of time on market and overlapping mortgages. In this case, agents will need to provide objective data and set honest expectations on price, timing, financials and offer contingencies. Time of year is also important. Spring/summer is an ideal time to take on the feat of both selling and buying.
The lines between home buyer and home browser are not always clear. By remaining flexible and dynamic with objective ideas and suggestions, the buyer’s real estate agent will strengthen the relationship and help clients find the home of their dreams.
Howard Brinton is a real estate sales motivational speaker and the founder and CEO of Star Power Systems, a sales training organization that offers tapes, books, videos, conferences and a club that distributes selling techniques from the nation’s top producers.