Whenever there’s a shifting real estate market, the agent that best explains it to their clients and community will win the most business. In today’s episode of the Real Estate Sales Podcast, Jimmy (along with Berkshire Hathaway HomeServices BPFLA member Price Rainer) explain what numbers and trends to look for in a shifting real estate market. And, more importantly, how to best explain those trends to your sphere of influence.
Determine the facts and figures about the real estate market.
- Compare data points from year to year regarding active single-family homes in a particular area.
- Analyze the average price, price per square foot, and the days on the market within the last year. (Do the same thing for pending and sold properties.)
- Look at how many sales have happened in each month of the year; you’ll notice themes that give you input to share with your community.
- Watch the pricing trends each month and share that knowledge with your clients. In a shifting market shift, clients need this information now more than ever.
The Federal Funding rate influences everything in the economy.
- The Federal Reserve intervenes in monetary policy to achieve job growth and maintain our economy, and one of their tools to accomplish this is the federal funding rate.
- That is the benchmark rate all short-term variable interest rates are based, and it drives our economy.
- We’ve been in a period of historically low federal funding rates, which has impacted every other facet of loan funding.
- Stock traders base their deals on what they believe the federal reserve will do, because stocks reflect what people think the price will be worth within 12-24 months.
- It’s essential that realtors are aware of this because these variables directly correlate with how the real estate market will be impacted.
Communicating the information to your clients:
- The first thing a client might ask now might be, “is now the right time to buy?”
- If their goal is to buy and sell in one year, maybe not. But if they’re looking for a legacy place for generations to come, there are still historically low-interest rates and increased inventory than the previous year.
- If someone is waiting for prices to drop before purchasing, the market might drop. Or, it might not. So educate people on the true price difference they’re likely to experience because it likely isn’t the savings they envision.
- For sellers, demand is still through the roof. And as we approach a level market, sellers will still have the advantage if the home is priced correctly.
- Price to the market. Determine the best price by analyzing sold prices for comparable properties recently on the market.
Remember, the most power you have is the ability to say no. Step back if a potential buyer or seller urges you to reduce commission or raise the price. Remind them that you’ll be there if they can’t find someone to do it for them.
Do you have a video or content idea that is perfect for your business? Share it with Jimmy! Connect with Jimmy Burgess on LinkedIn and Facebook and his YouTube channel. If you like what you heard today, we’d love it if you’d share a rating or review and then subscribe to the podcast and tell others about it. You can find The Real Estate Sales Podcast on Apple Podcasts, Google Podcasts, Spotify, Audible, and our website, The Real Estate Sales Podcast.