It appears that the mortgage rate hikes have resulted in first-time buyers and others on tight budgets getting priced out of the market.
But there may be a way around this challenge.
Even though fixer homes aren’t as rock-bottom cheap as in the past, they can still present value to this pool of buyers.
And there are various loan programs that support the fixer home purchase. Let’s take a quick look at the two most popular: FHA’s 203(k) loan and Fannie Mae’s HomeStyle® Renovation Mortgage.
The FHA 203(k) Rehab Loan
If you haven’t had an opportunity to work with FHA rehab-loan buyers recently, there are a few changes you may not be familiar with.
The FHA 203(k) product, for instance, has new names for its two tiers:
The 203(k) Full loan is now known as the 203(k) Standard.
The 203k Streamline is now known as the 203k Limited.
Along with the new names came some small changes to each product. For instance, “Repairing or removing an in-ground swimming pool is allowed on both 203k Standard and 203K Limited loan programs with no dollar limitation as to bid amount,” according to the pros at Amerifirst Home Mortgage.
Other notable changes include:
The 203(k) Standard now allows for foundation work to take place even when the home isn’t going to be razed.
The Limited program now requires that the buyer submit a work plan wherein “… one or more contractors will provide the cost estimate or bids.”
Other changes were also made, and you can review them at Amerifirst Home Mortgage’s website.
Fannie Mae
Fannie Mae’s HomeStyle® Renovation Mortgage is a conventional loan backed by the GSE. The advantage this presents for your struggling clients is that “As a government agency, Fannie Mae exists to help make housing more affordable to mid- to low-income borrowers …” and those with “… poor credit histories and scores,” claims Lauren Bowling at Rocketmortgage.com.
This product is also ideal for those clients seeking a multi-unit home, such as a duplex, triplex, or quadplex, Bowling adds.
Naturally, there is a lot more to learn about these loan products, and you’ll find this information online at:
PLUS: When you have time…below are some marketing tools to help support your success.
1. Put Your Real Estate Business a Step Above with Your Own Branded Magazine
Homes & Life Magazine is a customizable magazine with rich, full-color content and a sharp, professional aesthetic. It includes compelling, direct response-driven articles written by real estate industry experts and engaging lifestyle content. Send out Homes & Life Magazine in Just Minutes – No Minimums Required. Or we’ll ship it to you. Homes & Life Magazine is the ultimate “Coffee Table Lingerer”! …and it costs less than sending a greeting card! – Click Here
2.The Free 6-Month Done-For-You Strategic Marketing Plan
The Real Estate Marketing Planner is a powerful 6-Month Guide that strategically defines what marketing to do and when. Four key market segments include niche Markets, geographic farming, sphere of influence, and past clients. – Click Here
3. The Free Interactive 6-Month Real Estate Business Review
The Free Interactive 6-Month Real Estate Business Review allows you to enter your business goals for the remainder of the year and get a breakdown of how many prospects, listings, closing, and so on are needed to reach your goals. – Click Here
4. The Become a Listing Legend Free eBook
Ready to take a vertical leap in your real estate career? If you’re looking for inspiration…and the tools and methods to dominate a market and go to the top in real estate…you’ll find them in this free book. – Click Here
As a new buyers agent, you may still be learning the ropes. Now is the time to cultivate good habits and avoid making the mistakes that many other agents make.
One of the most prevalent among the latter is assuming that your clients know what they need to know during the home buying process.
In reality, most first-time buyers know little, if anything, about buying a home and are counting on their agents to guide them through the process.
Do them a solid and share with them the following 3 warnings.
1. Getting preapproved for a mortgage is non-negotiable
“For 41% of recent buyers, the first step that they took in the home buying process was to look online at properties for sale,” according to the NAR’s Profile of Homebuyers and Sellers.
Yes, the prospect of buying a home is exciting, and without knowledge of the process, some folks jump right over the baby steps of shopping for a lender, loan preapproval, and interviewing buyers’ agents. They hop in the car and start looking at homes for sale without even knowing how much home they can afford.
It’s a recipe for disappointment
Knowing how much they can spend is paramount, both in avoiding wasting your time and theirs.
Then, there’s the fact that sellers and their agents want to see a preapproval letter.
Experienced agents know well the couple that fell in love with a house they found open on a Sunday afternoon only to learn later that it was way out of their price range. Nothing you show them after that will stack up.
2. Help them understand the home loan process
Check this out: “41% of Americans who’ve never owned a home believe 20% down payments are required,” according to Maggie Davis at lendingtree.com.
These people are first-time homebuyers who are absolutely clueless about down payments. Yes, 20% down is best for the borrower, but a smaller down payment certainly doesn’t prohibit them from buying a home.
The First Time Buyer Series is shown above. To see more designs, Click HERE.
So, although it’s a given that agents should counsel their buyers that they need to see a lender before looking at homes, they also need to warn their clients about the out-of-pocket costs involved in the purchase of one. Then, give them the good news about low-down loans and down payment assistance programs.
3. About that final credit pull
Because they aren’t fully tutored on the mortgage process, many newbie homebuyers rightfully assume that once they’re approved for a mortgage, they will remain approved.
They can relax.
Many are so eager to get started shopping for furniture, new appliances, and other items for their new home they run up hefty credit card tabs. Additional credit changes their ratios, and they may find themselves without a home to fill with all those purchases.
Remind your clients that it’s not a done deal until it closes. Changing jobs, making large purchases on credit, and allowing credit inquiries after loan approval have all proven detrimental to many buyers. The lender’s soft pull just before closing should be explained fully to your buyers.
Yes, we all wish that mortgage professionals would pass these warnings on to your clients, but they typically don’t.
Just consider these warnings as part of what we know will be the amazing customer service you will provide all of your buying clients.
PLUS: When you have time…below are some marketing tools to help support your success.
1. Put Your Real Estate Business a Step Above with Your Own Branded Magazine
Homes & Life Magazine is a customizable magazine with rich, full-color content and a sharp, professional aesthetic. It includes compelling, direct response-driven articles written by real estate industry experts combined with engaging lifestyle content. Send out Homes & Life Magazine in Just Minutes – No Minimums Required. Or we’ll ship it to you.
Homes & Life Magazine is the ultimate “Coffee Table Lingerer”! …and it costs less than sending a greeting card! – Click Here
2.The Free 12-Month Done-For-You Strategic Marketing Plan
The Real Estate Marketing Planner is a powerful 12-Month-Guide that strategically defines what marketing to do and when. Four key market segments include niche Markets, geographic farming, sphere of influence, and past clients. – Click Here
3. The BusinessBase, SOI building system
The most effective thing you can do to build a real estate business is to become more visible, more likable, and remembered more often. The BusinessBASE™ not only checks all of these boxes but is also a business-building machine. In two easy steps, you can begin to build a robust sphere of influence that will provide you a lifetime of repeat business and referrals. –Click Here
4. The Free Interactive Real Estate Business Plan
The Free Interactive Real Estate Business Plan allows you to enter your business goals for this year and get a breakdown of how many prospects, listings, closing, and so on are needed to reach your goals. – Click Here
5. The Become a Listing Legend Free eBook
Ready to take a vertical leap in your real estate career? If you’re looking for inspiration…and the tools and methods to dominate a market and go to the top in real estate…you’ll find them in this free book. – Click Here
6. The Take a Listing Today Podcast
Watch the ProspectsPLUS!, Take a Listing Today Podcast for actionable content to help you get more listings. – Click Here
Have you ever had something bad happen to you only to find out later on that the event was actually a blessing in disguise?
Jackie, for instance, was fired from her job. Sure, she panicked during the first few days of unemployment, but a month or so later, she was doing something else for a living. Something she dreamt about but never had the courage to pursue.
Had she not been fired from her previous job, she may have never gone after her dream.
The transitional real estate market is a lot like that. What appears to be a time of challenge or, at the least, discomfort may turn out to be an amazing time for real estate agents.
Coming back down to earth may mean “crashing” for some clients
Home price gains are shrinking, and sellers are starting to come back down to earth. However, coming back down to earth doesn’t happen overnight, as you seasoned listing agents know.
After years of media reports of rapidly escalating home prices, multiple offer situations, and uber-quick sales, those sellers who choose to wait until the tail end of the sellers’ market to jump in are hard to convert.
They’re not going to get that their home is no longer the belle of the local real estate market, that their hoped-for price is now a fantasy, and that it may take longer than 24 hours to get it under contract.
And, those sellers who put big bucks into the house to ready it for the market are going to be more than a bit upset
Especially when buyers start nit-picking them over price, terms, and more.
The Call To Action Series is shown above. To see more, click HERE.
Then, there are the buyers
If you’ve been a listing agent for more than a minute, you can recall the last buyers’ market. Newbies, on the other hand, are in for a rude awakening.
No longer can you chuckle over seemingly stupid requests in an offer because you have three others that are cleaner-than-clean. You will actually be expected to negotiate on your client’s behalf.
“Good grief, how do I do that?” you may ask yourself as a new listing agent.
Very carefully.
While price is the typical hot button in a contract, “the devil is in the details”.
Details are important
“Details” when it comes to a real estate purchase agreement are the terms. If this turns into a full-blown buyers’ market, contract terms are where listing agents can work their magic during negotiations.
And, if you have examples of how you’ve done this in the past, use them for all they are worth. From your clients’ testimonials to full-blown case studies, let potential listing clients know how you’ve met with success in the buyers’ market.
Now is the time for all good listing agents to figure out how they are going to deal with the oncoming buyers’ market. Don’t put off your planning. Face it and go for it.
We’ll be with you all the way, so keep checking back.
PLUS: When you have time…below are some marketing tools to help support your success.
1. Put Your Real Estate Business a Step Above with Your Own Branded Magazine
Homes & Life Magazine is a customizable magazine with rich, full-color content and a sharp, professional aesthetic. It includes compelling, direct response-driven articles written by real estate industry experts combined with engaging lifestyle content. Send out Homes & Life Magazine in Just Minutes – No Minimums Required. Or we’ll ship it to you.
Homes & Life Magazine is the ultimate “Coffee Table Lingerer”! …and it costs less than sending a greeting card! – Click Here
2.The Free 12-Month Done-For-You Strategic Marketing Plan
The Real Estate Marketing Planner is a powerful 12-Month-Guide that strategically defines what marketing to do and when. Four key market segments include niche Markets, geographic farming, sphere of influence, and past clients. – Click Here
3. The BusinessBase, SOI building system
The most effective thing you can do to build a real estate business is to become more visible, more likable, and remembered more often. The BusinessBASE™ not only checks all of these boxes but is also a business-building machine. In two easy steps, you can begin to build a robust sphere of influence that will provide you a lifetime of repeat business and referrals. –Click Here
4. The Free Interactive Real Estate Business Plan
The Free Interactive Real Estate Business Plan allows you to enter your business goals for this year and get a breakdown of how many prospects, listings, closing, and so on are needed to reach your goals. – Click Here
5. The Become a Listing Legend Free eBook
Ready to take a vertical leap in your real estate career? If you’re looking for inspiration…and the tools and methods to dominate a market and go to the top in real estate…you’ll find them in this free book. – Click Here
6. The Take a Listing Today Podcast
Watch the ProspectsPLUS!, Take a Listing Today Podcast for actionable content to help you get more listings. – Click Here
A new Joint Center for Housing Study from Harvard University calculated 12 million American’s spend more than 50% of their earnings on rent.
This reality is probably why more renters are waking, up fed up that their rent checks are lining their landlord’s pocket and are ready to considering buying.
Renter Scheduled Campaign
In the past, Americans in the nation’s most expensive cities have chosen to rent because it appeared to be a feasible solution. In San Francisco, for instance, where the median starter home costs about $895,000, there are more high-income renters than homeowners, according to the U.S. Census Bureau.
As rents rise, however, they’re realizing that perhaps a fixed-rate mortgage payment is far better than the wildly accelerating rental rates of late.
Yet, some people still choose to rent. Why?
Many are cash poor and don’t understand that they don’t have to have a huge chunk of money for a down payment and closing costs. Others assume they can’t afford to purchase, despite having a decent income.
To successfully pursue this real estate audience requires targeted marketing that dispels myths and speaks to their pain points.
Renter Scheduled Campaign
Here are some suggestions on topics you may want to use to attract these tenants.
That up-front cost
“I was a long-term renter because I wanted to wait to buy until I could afford to stay in my current neighborhood,” a new homeowner tells Jennifer Bradley Franklin at BankRate.com.
So, why the long-term tenancy? “I didn’t realize that there were affordable options,” she told Franklin.
One would think that with all the information at our fingertips, real estate consumers would be better informed about down payment assistance, closing cost help, and the overall long-term cost advantage of buying over renting.
It’s the assumption that the costs are higher when you buy than when you rent that keeps many of them out of the housing market. Dispelling this myth is a worthy goal in your marketing efforts.
Although many are reserved for low-to-moderate-income earners, there are some for those who earn more.
Renter Scheduled Campaign
In fact, with more than 2,000 down payment/closing cost assistance programs nationwide, you are bound to find one for your higher-earning, home-buying prospects.
Or, let them know that the FHA-backed mortgage has a down payment that can go as low as 3.5% and there are no income limits for borrowers. You would be shocked to know how few consumers are aware of this.
What demographic of renters you should target?
When creating your rental prospect list, target renters who earn in excess of $70,000 per year. Especially the 1.35 million-plus American households who earn $150,000 per year or more and who “became renters between 2007 and 2017.” (US Census data).
If you’re in a market that doesn’t provide an adequate targeted prospect list when you target $70k and up, then grab an annual salary range that better fits your market.
ProspectsPLUS! has a demographic search tool that makes it easy to build a list of high-income renters based on an annual income range you choose, under the “custom search” option.
NOW, you can convert renters into home buyers with less work
The ideal way to communicate, educate, and build trust over time with renters is to launch a renter postcard marketing campaign.
And, now, your ability to do this just got TEN TIMES EASIER with the New ProspectsPLUS! Renter Scheduled Campaigns.
In one quick sitting, you can schedule your renter postcards to go out over a period of time on a weekly, bi-weekly, monthly, or bi-monthly basis.
And, YOU DON’T PAY until each mailing goes out (change or cancel up until the night prior to mailing)!
To Launch a Renter Scheduled Campaign, Pick a Postcard Series, Then:
Choose Your Start Date (see image below)
Pick your mailing interval (weekly, bi-weekly, etc)
Then attach your renter prospect list (you can schedule as little as one postcard to go out).
To get started on your renter scheduled campaign, from a desktop or laptop computer, click the “Go Now” button, below.
PLUS: When you have time…here are some helpful resources we’ve made available to support your success.
1. Become a Neighborhood Brand
Become branded in a specific neighborhood with a 12X15 marketing piece sent automatically each month to an exclusive carrier route. Watch this video to learn more or Click Here.
2. The Free Real Estate Mailing List Guide
The Real Estate Mailing List Guide outlines the top tools for generating targeted prospecting lists including Baby Boomers, Empty Nesters, Investors, Lifestyle Interests, High-Income Renters, Move-Up Markets, and more. The Guide also defines done-for-you marketing campaigns to match these markets. –Click Here
3. The Free 12 Month Done-For-You Strategic Marketing Plan
The Real Estate Marketing Planner is a powerful 12-Month-Guide that strategically defines what marketing to do when. Four key market segments are included, Niche Marketing, Get More Listings, Geographic Farming, and Sphere of Influence. –Click Here
4. The Free One-Page Real Estate Business Plan
Treat your business like a business it is vital to long-term success in this industry. Some agents may put together elaborate business plans, yet there’s something powerful about keeping it simple. Check out our one page Online Real Estate Business Plan. – Click Here
5. Become a Listing Legend Free eBook
Ready to take a vertical leap in your real estate career? If you’re looking for inspiration…and the tools and methods to dominate a market and go to the top in real estate…you’ll find them in this free book. – Click Here
6. The Free Online ROI Calculator
Consistency and automation are the keys to success. Discover how effective direct mail marketing can dramatically increase your bottom line. Enter your statistics in our Free online ROI Calculator and click the ‘CALCULATE MY ROI’ button to see your results instantly! –Click Here
7. The Free Real Estate Marketing Guide “CRUSH IT”
The “Crush It” Guide includes easy steps to launching an effective direct mail marketing campaign, how to create a targeted prospect list, the perfect way to layout marketing materials for success, seven opportunities available to target in your area right now. –Click Here
