A Buyers' Market?????

Everyone seems to agree that we are in a buyers' market. Well, if that's so, where are all the buyers and why aren't they buying? In his great new book SHIFT, Gary Keller says, " It's not a fence sitting, waiting, loitering, delaying, dawdling, postponing, vacilating, hesitating, wavering, faltering, pausing, foot-shuffling market. .....by its very name it means buyers should be doing one thing and one thing only--buying". It's really incredible to think that not very long ago when it was a sellers market, buyers were so excited to buy that they were willing to pay asking, and even above asking price, and that was considered a sellers' market! "Buyers were afraid of losing out by not buying even though the advantage was all to the seller," Gary says.

I believe that buyers and homeowners view homes as an investment rather than a home. Instead of saying it is a place to live, a neighborhood, a school district, proximity to work or recreation, a place to entertain family and friends, a backyard, etc., they see only the dollar sign. I am not trying to say that price is not important, of course it is. That is why, right now, when prices are down, when interest rates are low, it is a buying opportunity. Once gone, it won't come back again until we go through the next cycle, at which time prices will go up and houses will be higher priced. Honestly, there are some great buys out there right now!

Our customers/clients, are listening to much to the media or friends and family members. The friends and family members are well meaning but, when was the last time they bought a home? This is a unique market, unlike any other buyers' market in the past. So all the experiences in the world over the last 20 years are not relevant to todays' market.

The media, that's another story. Has anyone sat down and analyzed what they base their data on? The information they report is usually old and dated. When they report quarterly they are basing their information on old data. For example, a report in May for the first quarter of the year, is reporting on sales that occurred, January through April. The sold properties usually were listed in the later part of the previous year for closing in January and possibly February. The sold reports for March and April are usually reflected back anywhere from the previous year into the first couple of months of the year being reported. This is already old information and as we have seen this past year, the market data keeps adjusting and dropping in price while inventory keeps going up. Even more importantly, much of what is reported by the media is on a national basis. Haven't they heard that real estate is local? What is more pertinent to us and our buyers and sellers, is what is happening locally. Even then, locally can be misconstrued when you have a County that covers high end and lower socio-economic areas. This is why we do Comparative Market Analysis' on specific Towns and School Districts. We do try to paint the right picture for our buyers and sellers. Meanwhile, they are reading the news that may be saying something else.

We as Realtors, need to become the "Professional Voice" of our local business and for our clients. Our clients come to us for our guidance and our experience to guide them accordingly. We need to be their economist of choice, providing useful and accurate information, giving them a more balanced perspective of the local market. We need to help them see that this really is a good time to buy, not because it benefits us, but because it truly benefits them!

No one knows for sure when the market has or will bottom out. We find that out when the market has already made the turn upward. If buyers wait for the media to tell us that it has turned, it is already one ,two or three months into the up swing. Valuable time has been lost and they will not see that lower level again. Once it has turned the corner it won't be back until the next cycle. We have to alert our clients about the market trends that we say daily on our MLS's. How many of you now are seeing less New Listings and more price reductions? This is the first sign. Next the Contract and Pending reports will pick-up, then the solds. Real Estate is cyclical and there is no way we know ahead of time when the cycle will turn, but if we are observant we will see the tell tale signs of the changes, as minor as they may be at the time.

Like the buyers, sellers realize that the prices are down, and that the inventory is high. If they are truly motivated sellers they are cognizant of the fact that although they may be selling lower than they had hoped for, but on the other hand, if they are buying (stepping up or down) they will pick-up a significant reduction on their purchase. It all balances out. When the prices are up there and you sell, you do get more, but if you are also buying you pay more. It is up to us to educate them regarding the processes. They shouldn't reject any reasonable opening offer and be willing to negotiate with a ready, willing and able buyer. Since the buyers are so few and in-between, usually your best offers come in right away. You do not want to wait for a better offer, it may never come again. My experience has been, that when I have a seller turn down what they believe is a ridiculous offer, they regret it later, they wish they had taken it or negotiated it. The next offer was always much lower. Once the market does start to turn upward the opportunities for buyers will diminish. Sellers will no longer need to make concessions is price or otherwise.

Gary says that we should, "....share the success stories of people who have recently made the decision to buy and are very happy that they followed through with their purchases". We need to let our "sitting on the fence" buyers know that there are happy buyers out there that took the plunge and bought, and that they are happy they did. These buyers have made the best decisions for themselves their families and their circumstances.

"At the end of the day", Gary says, "building buyer urgency is about expert knowledge of the market, careful consultation on their personal wants and needs, skill at communicating the opportunities of the market, and assertiveness in challenging their thinking". This is the market where the true professional Realtor will be at his/her best.

I have been arranging pizza parties for my "on the fence buyers" to meet with my happy and content recent homeowners that know they did the right thing at the right time. They are happy to help because they believe that we found them the perfect home at the perfect price. Had they waited they could never had afforded that same exact home. They are all young couples, a couple with children and some without but the bottom line is that they can't say enough about how we kept them informed, found the right homes, even when they lost out on some because they wouldn't go higher in bidding, they ultimately got what they wanted and needed. They are gratefull, happy and our best advertisement.

You don't have to do pizza parties, but you could get endorsements, letters saying the same thing. It can't hurt your credibility and your timeless efforts with the buyers that are sitting on the fence.

Good Luck...I'd love to hear your ideas, I am sure there are alot of success stories out there, please share we can all learn from each other.