‘Tis the Season to Stay Connected With Clients

‘Tis the Season to Stay Connected With Clients

The period between Thanksgiving and Christmas can be a challenging time for real estate agents, as families focus their attention on traveling, entertaining, and other family activities. But that doesn’t mean property deals grind to halt.

Sending out newsletters or holiday greeting cards, e-mailing clients the newest properties on the multiple listing service, and emphasizing the great deals out there are all good ways to keep home buyers and sellers engaged during the holiday season.

Prospective buyers and sellers who may have a sliver of time here and there need to know that their agent is available to them.  It is important, therefore, to emphasize that even if a phone call is not answered at once, text and e-mail are other options of reaching out and any communication will receive a prompt response.

It also would benefit practitioners to show some flexibility during the holidays in terms of where, when, and under what circumstances a client can meet with them.  If that means they must bring along a young child, for instance, the agent may want to have an assistant baby-sit as a courtesy.

Source: “Sell During the Holiday Season” Realty Times (11/21/12)

First-Time Home Buyers Being Shut Out?

First-Time Home Buyers Being Shut Out?

First-time home buyers are a shrinking pool, making up less of the housing market. Typically, they represent about 40 percent of buyers, but today their numbers have dropped to about 31 percent of buyers, according to housing data by the National Association of REALTORS®.

First-time home buyers are the only group of buyers whose share of home purchases have not increased over the last five months, CNBC reports.

FHA mortgages, with low down payment requirements, are a popular choice among this group of buyers, but the recent rise in FHA mortgage insurance premiums is hampering first-time home buyers. Some sellers are also even refusing to accept offers from first-timers that include FHA financing, real estate agents report. What’s more, FHA announced it would raise premiums again next year, another 10 basis points.

“Financing of first-time home buyers with low down payments threatens to become a significant problem in the U.S. housing market,” Thomas Popik, research director for Campbell Surveys, recently wrote. “Fifty percent of first-time home buyers use FHA financing, but FHA insurance premiums are increasing and underwriting is becoming more strict. Private mortgage insurance has started to fill the gap, but the long-term status of private mortgage insurance is in question pending the publication of the Qualified Residential Mortgage regulation resulting from Dodd-Frank.”

First-time buyers also face steep competition when targeting lower priced properties. Investors have flooded the market, snagging lower priced properties in all-cash deals that first-time buyers would typically be drawn to.

Source: “Housing Recovery Is Leaving Behind First-time Buyers,” CNBC (Nov. 26, 2012)

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Home Prices what’s really driving them?

Home Prices what’s really driving them?

The Wall Street Journal recently cited five significant factors behind the rise in home prices, as numerous markets see significant year-over-year gains. The big price drives are:

1. The rise in housing affordability – which is drawing more buyers out into the market who are looking to cash in on low mortgage rates and fallen home prices compared to a few years ago.

2. The rise in household formation – which is expected to hit 1 million new households this year. That is up from an average of 570,000 over the last five years, according to data by Bank of America Merrill Lynch.

3. The rise in rents – which has prompted more investors to purchase properties to rent out and more renters to second-guess why they are paying so much in rent when they could buy.

4. The decline in distressed sales and foreclosures – which has fallen significantly this past year. While distressed sales are still high by historical standards, they have fallen from their peaks in most markets, helping to alleviate the downward pressure on home prices in many areas.

5. Inventories of homes for-sale are at their lowest levels in nearly 50 years – and builders have cut back on construction and many home owners are waiting to sell until they can recover some equity on their properties.

Source: “Five Reasons Home Prices Have Been Rising,” The Wall Street Journal (Nov. 27, 2012)

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