Wanted:  Creative, flexible Realtors for an indifferent, misinformed real estate market. 

Both home sellers and home shoppers will have unrealistic expectations. They will prefer a resale and buy new construction, and vice versa. 

Expect low-ball offers from home shoppers that insult the seller.

Your goal: Become the trusted somebody in a ‘nobody’s’ market with every prospect you serve. 

Compensation: More sales to fewer prospects

 In her outstanding 2023 Housing Forecast, Danielle Hale, chief economist for Realtor.Com, says that “next year's market could become a ‘nobody's’ market, not friendly to buyers or sellers.

"If home shoppers and sellers have unrealistic expectations, they could find themselves in a stalemate in the year ahead.”

Question: If Realtors don't help consumers approach the market in a 'realistic’ state of mind, who will? 

"Consumers ready for the challenge will need up-to-date information on market conditions, creativity and flexibility to adjust, and a healthy dose of patience to create success." 

So will their Realtor.

"Home shoppers will enjoy advantages such as a growing number of homes for sale, but costs will remain high, challenging affordability at a time when overall budgets continue to be squeezed.” 

Here’s the problem amid a growing number of options," according to Hale's December 15 weekly report. 

"A robust jobs market is pushing up incomes but not quite as much as inflation. Thus, home shoppers are taking longer to consider effectively leveraging their smaller purchasing power.

What must Realtors do to help their clients understand their current market? 

For one, understand your local builder forecasts and what they mean to your resale clients. It could matter greatly. 

Prove your market knowledge. Stay abreast of the changes. Here’s a current sample. Notice the link to your local market. 

NAHB's latest estimates show that, nationally, 87.5 million households (roughly 69% of all U.S. households) are already unable to afford the median-priced ($412,505) new home.

"A $1,000 increase (to $413,505)  in that median-priced new home will further price 117,932 U.S. households out of the market. Based on their incomes and standard underwriting criteria, these households would be able to qualify for a mortgage to purchase the home before the price increase but not afterward.  

"Similar priced-out estimates are available for individual states and over 300 metro areas."

 What does this mean to sellers? It means their resale home and home buyers could be competing for new home prospects. . Not an easy task for the homeowner when builders offer to pay down the mortgage interest rate and include contributions to mortgage closing costs, among other incentives.

If you are listing a resale around the same price as your market's new home price point,  show the NAHB data. The higher the price, the lower the number of qualified buyers. 

Be creative. Understand what is happening with your clients. If they are making but losing good-faith offers and failing, or they don’t seem ready to buy,  don’t lose confidence in them. Find another way.  

For example: 

If a renter comes to you with a lease that expires in 4 months and they want to look at resales, what do you do?

1. A. Tell them to come back within 60 days of the lease expiration because resales close in 30 to 60 days.
2. B. Put them on a mailing list and keep in touch.
3. C. Ask them if they would move in 30 days if the builder agreed to pay the remaining lease payments. 
4. D. Other

Answer: D. Other 

Call builders in the home shoppers' price range and location preference. . Ask if they have available any partially built homes that will be ready in the next four months or so. They may have homes under construction that the buyer may have canceled. 

While on the phone, ask if they are willing to take over lease payments as an option if your prospect is willing to move at any time.  

Prices are not based on MLS comps alone, but 

Expect buyer incentives to increase and become more negotiable if the market softens. 

Stay informed. Don't overreact if prices increase. It could happen. 

The higher the interest rates, the smaller the market share and the more the homebuilders will reach out to Realtors. Builders know that Realtors control 90% of the resale market and sell between 65-70 percent of all new homes.

Qualify resale shoppers for new construction. 

Resale shoppers who prefer resales but buy new homes are becoming a sub-market segment. According to NAR and others, this is one reason recent new home sales were up 6.7 percent in October over last year. 

A short checklist:

1. 1. Make it your business to know the new homes inventory in your market. Check MLS and newhomesourceprofessional.com, an excellent and popular resource among Realtors.
2. 2. Check out new home builders in the zip codes you like to work. Call a few builders about mortgage rate buy-downs,  commission policies, and online registration policies. 
3. 3. Be intentional about working with onsite agents. Stop by new home sales offices.
   4. Ask them what is and is not negotiable. They will tell you. 
4. 5. Never try to negotiate in front of your buyer unless you know what is negotiable. 

2. Take an online new home sales training course. There are some good ones out there.

Once you find a builder that qualifies for saleable inventory and an affordable mortgage payment,  you are more than halfway home.

Add this builder to your ‘preferred builder’ list.

Buyers and sellers don't need just any Realtor. They need somebody in this nobody market they can trust to provide services and advice that helps them make decisions based on realistic expectations. 

Remember, you must understand the market, be creative,  be flexible, and be more patient than ever.  

To thrive or even survive, you might not have a choice. .