As a real estate agent, you want to have a great year as the housing market shifts, but you're having a hard time convincing your leads to buy a house now. You will love these tips to overcome buyers' doubts about buying a house in 2022.
"I would like to wait until 2023 to buy a house. Rates and home prices will hopefully be lower."
Helping first-time home buyers understand that 2022 is an excellent time to buy a house can be frustrating. Buyers think about low-interest rates from the previous year and cringe when they see today's much higher rates. "I would like to wait until 2023 to buy a house. Rates and home prices will hopefully be lower," you hear your client say. Fortunately, you've got a few logical reasons why your clients shouldn't think that way and should buy a house this year.
Home prices may have dropped since the inflated prices we witnessed in 2020 and 2021, but there is no guarantee that prices will be significantly lower in 2023. No one has a crystal ball that can accurately predict future home prices and interest rates. The three highlights below will help you convince clients to buy a house now versus later.
- Home price reductions
- Less competition from other buyers
- Interest rates: can always refinance if they drop in the future
In most areas across the country, we're seeing housing prices drop. What clients need help understanding is that some of these price drops resulted from homes being overpriced in the first place. Seller's agents may have based the home price on home sales from 2021, which isn't realistic. Homes need to be priced at a price someone is willing to pay in today's housing market.
Is the sales price of the home based on comps over the last 2 years, and is that realistic in today's housing market?"
When first-time home buyers see a newly listed house for sale at $400,000 and 6 weeks later see the price drop by $20,000, they think they're getting a great deal. Your clients don't know that the comps used to price this house may have been from similar homes that sold at the end of 2022, which were vastly inflated prices. Simply put, the home is overpriced even with a $20k price reduction.
With an agent like yourself, who understands a home's actual value in today's market, you research the home's value and determine that it is worth $350,000-$365,000. Your client is impressed with your findings and excited to put in an offer. You've proven your value as a real estate professional by saving them a lot of money. After that same house has been on the market for 8+ weeks, making an offer closer to $350,000 might appeal to the homeowner.
Fewer Home Buyers
I'm sure you have clients who are burnt out because they made offers on houses last year and lost out to other buyers. They're frustrated and don't want to compete anymore. Reassure your clients that fewer people are looking to buy homes now, which means less competition. Waiting until next year to buy a house will likely result in more competition because of everyone who opted out of buying this year.
When home buyers tell you they want to wait until 2023 to buy a house because of high-interest rates, ask them what's the benefit of waiting for interest rates to drop. They might not have an answer, but you will. Tell them that if they buy a house this year and interest rates increase, they can rest easy knowing they're locked in at a lower rate. If interest rates go down, remind your client that they can refinance at a lower interest rate. Helping home buyers understand what today's interest rates may mean in the future will reassure them that now is an excellent time to buy a house.
If today's interest rate is lower next year, they can refinance. If the rate increases, they won't be affected because their rate is locked in.
As the housing market shifts, you're the real estate agent who will close more deals as you help first-time home buyers navigate today's housing market. Your real estate knowledge will give buyers clarity on the changes in housing prices compared to previous years. You will help clients see the value in today's interest rates and why buying now is better than waiting until 2023.