It is not uncommon for many prospective home buyers who are not educated about current local market conditions to have unrealistic expectations. Often they are unaware of how quickly the market is moving. While the housing crash is still fresh on the minds of many consumers, the lower prices and higher inventory levels of the past are no longer prevalent in most markets today. In fact, the majority of Realtors® participating in a recent REALTORS® Confidence Index indicated that their average home transaction price is higher than the previous year. Also, properties remained on the market for an average of 44 days in June 2014, according to the survey.
So, how can real estate professionals prevent lost sales from unrealistic buyers with limited inventory? As it turns out, education is the key. Do your homework, show buyers the market data and provide them with options that will help them to reset their expectations. For example, if a prospective buyer wants to buy a mansion in one of Chicago’s tony suburbs for $150,000, agents need to show the client that this is unrealistic based on current market conditions. It’s important to consult with the buyer and have them prioritize their wish list and give them realistic options based on what they can afford.
Real estate agents should also have the buyer focus on getting their monies together and putting them in touch with a mortgage broker so they will know how much home they will qualify for and the amount of down payment they will need. This way when you do show them a home they like they will be able to act quickly to make an offer on the property. Otherwise, the home could be sold to someone else before they are qualified for a mortgage leaving the prospective buyer disappointed.
One of the advantages of being a real estate agent is the vast amount of real estate resources available at your fingertips. When you use these resources to educate the buyer about the reality of current market activity and help them explore alternative options based on availability of current inventory you will increase the chances of not only completing the sale, but helping the buyer to find a home they can afford and will truly enjoy.
Photo Credit: Anna Langova