We need to take a minute and talk about the news we hear and the reaction there might be from it. We also must be very careful to look at the facts and the analysis by a variety of sources to be sure we have a clear view of what things actually mean and how they might impact the markets we serve.
I say this because we all know there is a significant media bias against the housing market. No matter what happens, there is always some outlets who are going to frame everything in the most negative light, even when an obvious upside is staring them in the face. The best example continues to be the complaint about inventory of homes for sale. YES, the number of homes on the market is falling, but that hasn’t stopped record numbers of home sales in 2018, 2019, & 2020. How can there be record breaking sales if there isn’t any inventory? Just yesterday there was a number of articles about falling purchase mortgage applications and a 3% drop in those mortgage applications accounting for lower home sales. Well, that may be true, but in this case, it isn’t; there were actually more contracts last week as there was a HUGE increase in the number of homes sold for CASH! Cash buyers don’t apply for mortgages!
Now, there is some pending data that will be reported tomorrow, June 4th, and next Thursday, June 10th, that you just need to be aware of. June 4th we will get the May jobs report and June 10th we will see important inflation data. These two reports could impact the interest rate markets either good or bad, depending on the news and how that news is viewed. I say this not to create fear or to say what will or won’t happen, I say this because you need to be prepared if any or all of the data puts pressure on interest rates, the possibility of wild fluctuations could be very real. So be prepared, and as always, if you like it, lock it; if the customer wants to gamble, get it in writing that they chose to float and accepts the outcome of doing so.
As always, questions or comments can be directed to: This email address is being protected from spambots. You need JavaScript enabled to view it.
“One of these days, you are going to wish you paid more attention to me. Sincerely, Terms & Conditions” someecards
Real estate sales are still running hot in May of 2021, pushing the national median home price to $372,400, up over 16% from $310,100 a year ago. Low inventory of homes for sale continues to cause buyers to compete with other buyers for the same house. Buyers have to think fast and make their highest and best offer. The saying goes, “if you have to sleep on it, someone else will be sleeping in it.”
On one end of the see-saw, you see rising home prices. On the other end of the see-saw are low mortgage rates and high wages attempting to keep everything balanced. New homes hitting the market help maintain a balance between homes for sale vs. high demand from homebuyers.
Watch out for rising mortgage rates, though. Rising mortgage rates along with higher home prices could cause a correction in the rate of increasing home prices, even though prices are expected to continue to rise over the next year or two.
Other costly mistakes to avoid on the home purchase contract:
1. Carson and Casey thought they knew the neighborhood and made a competitive offer to pay $10,000 over the appraised value. They thought the house would appraise for $175,000, but it appraised for $225,000. Oops! The unexpected higher price took Carson and Casey way past their budget, and they did not have enough money to close without pulling money from a retirement account. Expensive!
2. Stay clear of clauses like, “seller to pay a $10,000 decorator allowance to buyer at closing.” Traditional mortgages prohibit the buyer from getting cashback from the seller in this manner. There are other solutions to appease both parties without giving cashback to the buyer.
Real estate and mortgage professionals bring value to home buyers and home sellers when they can apply their knowledge to avoid costly traps to these customers. When you save a customer from a bad experience, they reward you richly with referrals for years to come.
Memorial Day weekend has always held special meaning to me. As a young boy it was about parades, ballgames, and barbeques. Times when friends and families would gather and share stories. Mine was a generation of boomers, born in the 50’s, fresh out of the Korean War, WWII, and with plenty of those still around from WWI. As I grew up, the country faced Vietnam and as an adult, a number of conflicts around the globe in which brave men and women risked their all for their country. For this, we must take the time to remember those who gave their all.
I think it only fair to share that my belief is many will enjoy parades, games, barbeques, and family gatherings, but so many of the stories are either gone or will not be shared; some stories will not be heard. It is important to acknowledge the events of the past, not as if they were right or wrong; but that they were entered, people were called to duty and responded.
This weekend is about remembering and reminding us that we have the ability or disagree, get along, do what we please when we please, all because for 245 years, brave patriots have responded to the call freely and were willing to give their all for us to do as we do.
Have a safe and sound holiday weekend, be sure you take some time to remember those who have come before us and gave the last full measure of devotion. God bless the United States of America!
Questions or comments: This email address is being protected from spambots. You need JavaScript enabled to view it.
1. First, do a “Current Assessment” of strengths, weaknesses, opportunities, and threats that exist in your chosen career path. Dr. Peter Drucker used to say “To make measurable progress you have to know where you are starting from."
2. Consider (or set) your goals for the next five years and ask yourself what you need to learn to advance yourself. Consider what the person you want to become is learning now! This will help you target your learning goals so that you can stay on track for positive outcomes. You may want to ask your boss which topics you need to advance your learning on. They will be impressed with your focus on self-improvement.
3. Start making a list of books, periodicals, industry magazines, etc. you need to be reading and get started on them. You may want to keep a journal of what you have read with a listing of the “Key Takeaways” you gain. Another recommended activity is to think about what unproductive habits you have that you could replace with more learning time.
4. Develop some solid new habits that will help you achieve your new learning goals. Behavior change can be tough, but it is the only way to ramp up the knowledge we need to prosper in the coming times.
5. Consider other areas of education you might pursue. Have you thought about going back to school, or taking select courses that will help you become the person you want to be? Online courses are readily available on just about any topic you want to pursue.
6. Take action. Write down your new goals, stick to your plan, and make some great strides in what you learn. The depth of our knowledge becomes apparent to those around us, and we start to get blind-sided with new opportunities for career growth. I love it when that happens!
As you learn new things, you can convert them into new skill sets that will help you do what you do better or with greater efficiency. Concerning your current learning process, who are you becoming? What could you become if you knew more? Can you glean some positive actions from this newsletter to expedite your trip to the next level? Good luck!
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Almost every buyer in today’s market has faced the challenge of the seller’s market. Homes selling the moment (or even before) they are listed, homes with multiple offers, and of course, the dreaded multiple offers, sold over asking with appraisal and inspection waivers! Just to name a few!
Never before has it been so important to set the proper expectations with your buyers and arm them, and their buyer’s agents” with all the strategies at their disposal to make the odds move in their favor. This also includes defining for each buyer all the things they can be doing every day to improve as buyers.
We have talked a great deal about this before, but we are seeing solid results from people who are on the ground and getting deals done because they used one or more of these strategies:
• The quality of the offer is stronger because of the fully documented preapproval.
• The speed at which we can close can make our offer stand out over others.
• Working to bank as much money as we can to make stronger offers. Additional part-time work is available in most of the country.
• Using stimulus money, tax refunds, gifts, retirement funds, and even selling off other items to improve cash position.
• Considering paying off outside debt to improve scores or increase purchasing power.
• Lowering the down payment to free up cash so if the house doesn’t appraise, cash is available if the buyer chooses to do so. Even if that means accepting PMI to make it work.
• Increasing down payment to improve loan program and/or to lower borrowing costs.
• Getting really clear about the child tax credit that starts July 15th 2021 for most families with small children. Up to a $300 payment each month per child from July through December could really help the situation during the looking process, or for those who begin the search soon.
There are many challenges in today’s housing market for buyers. However, everyday people are getting offers accepted and families are winning the home of their dreams! The key for us in helping our clients and referral partners is to be certain we are helping our buyers buy better, by having all the tools and strategies at hand to help them win the deal!
Questions or comments: This email address is being protected from spambots. You need JavaScript enabled to view it.
In today’s world of dealing with unproductive Internet leads, it is time to cultivate the tried and true methods of yesteryear, the referral. A referral is often a warm lead from a trusted source. But have you ever sent a referral to another broker, and then never heard from that broker again? Join the club.
What is your conversion rate on getting or giving referrals? With over 2500 referrals given each day in the US between agents, you may want to focus on building a stream of income from this underserved resource. But when you are actively giving or receiving referrals, keeping track of status might be a challenge.
The communication of status and updates might be consistent or ,all too often, you never hear what the status is. Did the client have a good experience? Did the referral result in a sale? With the success or failure of the transaction, would you ever refer to that agent again?
Statistics tell us that people are moving to many different areas, and when they are referred to a professional by another professional, confidence levels raise to a more comfortable level.
However once referred, the referring agent is often not compensated with future referrals. Losing the contact, or infrequency of prospects wanting to buy or sell in a given area, can block getting a steady stream of future referrals going forward.
Want more referrals? Here are a few tips to increase the flow of referral income to your bottom line:
1. Have a referral marketing plan in place to intentionally solicit and offer referral reciprocity. Include in your current marketing messages an offer of specific relocation resources to target groups of prospects that may be in a position to give you referrals. Tailor your messaging to engage other real estate professionals in neighboring states that you are a resource for anyone coming to your destination area. Follow up with your sphere of influence and update them on migration trends for second home destinations. Poll your past clients with a non-solicitive checkup/check-in and remind them that you can leverage your services all over the country through your network to help their friends and family.
2. If you are located in an area with close proximity to other states, consider contacting top producing agents and companies of your offer to help their agents and their prospects that might be coming your way. Be consistent with updating this group with recent changes in your area that may be a new asset to those considering moving to your area.
3. Check out a new referral platform that organizes the referral process. Created by a practicing agent from Nevada, Todd Miller saw the need for a more systematized process for giving and getting referrals. He and his partner, Oana Sterlacci, developed ReferralCloud.co. (Note: Not .com- www.ReferralCloud.co)
This system acts as a referral coordinator for any real estate agent client referral and rewards those agents using the platform to more referrals acquired from inbound resources.
They addressed the fragmentation of the referral process by streamlining the online platform that shares real clients, not just a “lead”. With no monthly fee, ReferralCloud.io includes other strategic partners for referrals like lenders, to promote their services. With their position as a directory, agents who want to increase referral business may want to consider a platform that supports the referral process.
For more information about ReferralCloud.co,visit their website and click here for our video interview with this dynamic team.
Todd is the owner and broker of Nevada Realty Solutions, with his partner Oana Sterlacci. In 2009 Todd and Oana sold over 1,100 houses and were the #1 team in the nation as reported by the Wall Street Journal. Todd lists properties for banks, and regular sellers, including short sales. Todd also works with investor buyers and regular home buyer with his team of highly talented agents.
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