Record-low interest rates. Record high inventories. Current incentives for first-time home buyers. Anticipated incentives for all home buyers. There should be a feeding frenzy of buying going on right now....but there's not. Why?
Daggone it. I wish I wrote this article. It explains it all and very well. The title is "Turning Buyers Around" by Gary Keller, the founder of Keller Williams Realty, and it appears in the January 2009 issue of Realtor magazine.
[NOTE: I'm actually a little bit confused because the web article is titled "Overcoming Buyer Reluctance" while the hard copy magazine article is the "Turning Buyers Around." But it appears to be the same article. So, moving on....]
In any event, the article, and the magazine, are directed at real estate professionals, but there is some GREAT advice and perspective to share with, or use ON, your buyers. My favorite of all is the advice to take a piece of paper, to start drawing a line representing "the market" going down the page, and to have your buyers tell you when "the market" has hit bottom. Of course they won't stop you until you start that line heading back up! Then, when you ask them to tell you when the market has peaked, they will tell you to stop once you have turned the line back downward. The moral, according to Mr. Keller:
Buyers cannot perfectly time a market - no one can. The smartest people know this. They play in the safe zone. The safe zone is where smart people plan to buy and sell. Anyone who buys at the top of a market is just unlucky and anyone who buys at the bottom of a market is just lucky.
Another way of saying this, one of my favorite real estate-isms: Smart buyers are looking for a deal, not a steal.
Another very apt point, that to me sums up some of the frustration of being a practitioner in this market, follows:
The great irony of a buyers' market is that even though the opportunity to buy is high, buyer urgency tends to hit an all-time low. The media becomes the excited purveyor of negative news and uninformed advice, and buyers buy it all. ..,.Their reluctance is ironic since not so long ago buyers were incredibly excited about buying - and it was a sellers' market. Prices were escalating and it was perhaps one of the most difficult times to buy value and yet people were buying like there was no tomorrow. Buyers were afraid of losing out by not buying , even though the advantage was all to the seller.
Now a shift has occurred. Fear is still in the driver's seat but the tables are turned - the fear of paying too much seems to stop most in their tracks and immobilizes them. When they should have been afraid of paying too much they weren't, and now that they shouldn't be afraid of paying too much they are.
So on-the-fence buyers, read what Mr. Keller has to say. Don't take my word for it. This guy knows his stuff. And feel free to give me a call - I'm happy to find you a DEAL any day of the week.
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