What a year, right? With 2019 pretty much in the rearview mirror, the experts are whipping out their crystal balls to prognosticate what we can expect from the 2020 real estate market.
The only problem is that the future seems foggy to most of them
On a national level, “The housing market is in the midst of a normalization period, one that is characterized by slowing price growth, moderate sales and new supply that is slow to market,” Ralph McLaughlin, deputy chief economist at CoreLogic, according to Suzanne Da Vita at RisMedia.com.
“Hey, that doesn’t describe my market!” we hear ya’all yelling.
And, for good reason. The “location” 3x thing isn’t just a mantra but a rule when it comes to discussing the real estate market. It’s the hyper local that matters to the ones asking the questions.
Then there’s the fact that home prices have slowed their upward trajectory, “but could potentially resurge, as demand picks up,” claims Da Vita. Notice the hedging of the bets there.
Another guy says we’re approaching the “end of the cycle,” but he doesn’t foresee a collapse or even a strong correction.
See what we mean by “fog” in the crystal ball? It’s more of a looking glass in many ways.
So, regardless of whether the economy contracts (no surprise there; we’re overdue), the yield curve inverts or the real estate market corrects, who will you be working within 2020?
Your 2020 listing clients will, hopefully, come as a result of your 2018 and 2019 marketing efforts.
Who was your target? Aside from buyers and sellers in general, if you leaned more toward one than the other with your 2019 marketing efforts, concentrate on that group now until spring.
The same goes for the agent pursuing referrals from past clients and their sphere, those with a specific niche and agents who farm.
Looking for listings?
If it’s potential sellers you’ve been pushing down the sales funnel (with consistency, we hope), 2020 may be the year a lot of them pop out of the bottom (one can only hope, right?)
NAR studies find that the average age of a home seller is about 45 (a 25 percent share of the seller pool).
“Sellers age 64 to 72 made up the second-largest share of sellers at 22 percent with a median age of 68,” according to the 2019 Home Buyer and Seller Generational Trends report.
Baby boomers are aging out of homeownership in increasing numbers, so it wouldn’t be surprising to see the share of older sellers increase in 2020.
Whether the move is to senior living communities, managed care or a desire to downsize or be nearer to the grandkids, many of your potential sellers in 2020 will likely be in the 65 and older age group.
Since the majority of real estate agents are in (or very close to) baby boomer age, you’ll have no problem appealing to them. If you’re younger, read up on generating baby boomer real estate leads and how to work with them.
Don’t let iBuyers woo your seller leads
After a lifetime of living in the same home, the thought of the work required to prepare the home for the market may be daunting, so many would-be sellers are getting letters from iBuyer companies on a weekly basis.
Steer them from these disrupters by letting them know that:
- They’ll lose a pretty significant chunk of their equity. “In all, the typical cost to a seller [using an iBuyer] appears to be in the range of 13% to 15% depending on the iBuyer vendor,” according to research by Collateral Analytics.
- Show them proof:
- You may also want to debunk the iBuyer claim that selling with them is quicker. Last year, it took 64 days, from listing to close (national median) to sell a home with a broker (probably quicker in 2019).
Most iBuyers promise that the longest their process will take is 70 days
It’s also time to remind potential sellers that inventory is still squeaky tight and demand high and they should strike now, while interest rates are still attractive to homebuyers.
Let them know that some housing industry experts believe that the market will shift away from seller-favorable to a more beneficial buyers’ market sometime later in 2020.
“We anticipate 2020 to continue to shift away from a seller’s market, especially if GDP slows and inventory ticks up,” McLaughlin says.
Urgency – that’s the ticket
Now is the best time to go through your CRM and pick out your seller leads in the older demographic. Drip on them from now until spring, with valuable and urgent information on selling.
Don’t discount the Gen X upsizer
Remember that the average age of a home seller is 45, putting that group in gen X (age between 44 and 55 in 2020).
This group of around 62 million made up the largest group of sellers last year and 60 percent of them were looking to upsize, according to a Value Insured study.
Many of these folks are still raising families, believe it or not. The Pew Research Center finds that “In 2014, 80% of women ages 40 to 44 with a Ph.D. or professional degree had given birth.”
Meaning those highly educated moms have 6-year olds. But having little ones in the home isn’t the only reason this cohort is looking to sell and buy a home.
Members of Gen X make up the largest pool of larger and multi-generational homebuyers. More than half of them did so to accommodate adult kids who are moving back in with Mom and Dad, according to NAR.
No, we haven’t neglected our ProspectsPLUS! buyer agents. We’ll have a rundown of what you can expect in 2020 soon.
Send at least 100 The Best Time is Now postcard from the Get More Listing Series to an area where you want more listings.
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Need help targeting the perfect niche of buyers or sellers? Use our mailing list tool to create the ideal list (it’s easy) or call our support team for assistance at 866.405.3638!
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