Like Freud's famous question regarding women, REALTORS® often ask themselves the same thing - what do buyers want? The answer to that question may tantalize you, especially if you are losing customers to other agents, the Internet, for sale by owners, or anyone else who seems to have the answer.
The questions don't end, especially if you want to know why they don't choose your services. How can you improve service so they will choose you?
If you are trying to market to buyers, especially first-time buyers, a good place to find the answers is to examine a few trends that are most affecting the real estate industry today. That will help you better understand the buyer's mindset, and enable you to provide the right set of services to meet their needs.
Here are a few cultural and economic trends that affect buyers and what they want:
The Skepticism of Generation X
Just as the Baby Boomer generation has its characteristics, so does the Generation X first-time and move-up home buyers. The Gen X'ers are children of wealth, privilege and instant gratification. Very few have been to war. But they are also the products of the highest divorce rate in history, and the first generation to attend school with metal detectors on the doors. For a number of reasons, the Gen X'er says, "Prove it. "
"Question everything," is their cultural motto, and if they don't like the answers, they do business elsewhere.
Like all generations, they are egocentric within their own culture. If you can't speak their language, or do business in the medium that they are comfortable with - namely the Internet - they will dismiss you as a dinosaur.
The solution: Forget "vanity" advertising campaigns. They don't care about you, they care about what you can do for them. Don't respond to direct questions with generalities. When a buyer asks you what you can do for them, be specific with a step-by-step outline of your services.
This is the generation that is driving open information consumerism and buyer's agency. If you try to show this buyer a home that doesn't fit his/her profile simply because it is your newest listing, you will lose. This customer wants an advocate. They aren't fooled by the old saw that the seller pays the agent. They are smart enough to know that the buyer pays the agent out of the transaction proceeds, so they want their money's worth. If buyers really believed they were represented for free, the Internet home search sites would be empty, and all buyers would be represented by agents.
The solution : Don't play the shell game with this generation. Don't have an underlying agenda. Don't serve two masters - you are either representing the buyer or you aren't. You must show clearly what value you can bring them in the transaction.
The Information Age
First -time buyers were weaned on the Internet, and most are computer literate. With the deluge of information that can be found on the Internet, buyers are obtaining information for themselves about the home buying process, leaving agents out in the cold. On the flip side, they are also being given a lot of misinformation. The result is confusion and a buyer who is reluctant to act.
The solution : Be as familiar with the Internet as they are. Head disaster off at the pass by consolidating the best sites for your buyer and sending them the URLs via e-mail before they get bogged down on the 'Net. Your helpful but hands-off approach will be appreciated. Let them shop for a loan, look at homes or learn about the process on their own time in their own way. Be there as the safety net. Deliver information and services as directly as possible. Know what they know.
Ask a lot of questions which will help your buyer sort out what they want and don't want. Don't add to the confusion by showing them loans, homes or information they don't need. Remember, this buyer is very wary of a competing agenda.
The confused buyer will also not only test your patience, but will also require you to be up-to-the-minute in your Internet/technology skills. Be prepared to communicate primarily via e-mail, and be able to send photos and listings via e-mail. Tell it like it is. Be direct. Don't waste their time.
The Seller's Market
Despite seasonal adjustments and predictions by the National Association of REALTORS® (NAR) and the National Association of Home Builders (NAHB) that home sales will not be as high this year as last years record sales, communities from Houston to Washington, D.C. are still reporting hot markets.
The result is the do-it-yourself Internet buyer is going to use any means possible to find a home, including having multiple agents work for them, calling on FSBOs, looking at new homes or having a home built.
If your community is in a hot market, perhaps what your buyers need is an education about the economics of the marketplace, and what they can do to position themselves to buy the home of their dreams.
The solution : Explain the advantages of working with one agent, that you can network with other agents for them, negotiate better prices on new homes, and help them get into the home they want faster. You can help them become buyer ready - show those sellers and builders that they are serious.
Tell them that the best indicators of buyer readiness are:
Along with the excitement of owning a home for the first time comes many fears. Buyers fear such things as choosing the wrong home, getting into the wrong school district, not being able to resell if they have to, overpaying for a home, discovering the need for expensive repairs, and not being able to make their payments. Like the confused buyer, the scared buyer is often reluctant to act.
Buyers think the largest purchase of their lives is their home. It isn't. The loan is.
The solution : Putting the home loan in perspective will go a long way toward building your credibility with the buyer. Helping your buyer get pre-qualified is not just a convenience for you so you start showing them homes. It can also be an opportunity for you to build your buyer's confidence.
Ask your buyer what their concerns are. Be ready with school reports, crime statistics, neighborhood profiles or whatever it takes to ease their fears. Offer the option of a home warranty if the seller hasn't provided one.
With the first time buyer, hand-holding is part of the job of the Realtor, even if the customer thinks they don't need it. A clever agent will find a way to hold the buyer's hand where the buyer never feels a thing.