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Virtually everyone has a challenge with their home. Maybe they wish it were just a little closer to town, want a soaking tub in the primary bathroom, have less upkeep, or more energy-efficiency. Most people will live with a few of these issues until it just becomes too much and they see another option that meets their needs better than their existing home.
The challenge we have right now is that second part of the equation - seeing another option that meets their needs better than their existing home. Little inventory available means that the market is being squeezed. Even if they do have a home search of some kind set up, they aren't seeing inventory that meets their needs and even if they did find something that met their needs, they wouldn't necessarily want or be able to trade in their current mortgage payment and interest rate for what they would need to buy.
I was selling real estate when interest rates were WELL above where they are right now and I can tell you there were a number of sellers who had been dealing with a home that no longer met their needs. They were frustrated. They were tired. Some had multiple kids crammed into two-bedroom townhomes. Some had homes that were too large for their current living conditions. Some wanted to move out of the area completely but they felt stuck, stuck, stuck.
Most of these sellers won't even pick up the phone or send an email to talk with you because they assume that nothing can be done about their situation. In many cases, this may be true. But it is also true that you probably have some tools that your potential clients don't even know exist. In fact, you can likely help them pinpoint their Move Mark - that point in which it makes sense for a homeowner to sell.
Think about your own situation as an example. Unless you have very recently moved, your home probably doesn't fit all your needs. What if a home was available to buy that did fit all your needs? From there, you only need a few more pieces of information:
Once you have this basic information, you can weigh the pros and cons of moving. For example:
You can see once you do the exercise for yourself that by looking at the points and taking the emotion out of the situation, you can easily weigh the benefits of moving versus the benefits of staying. In this case, it is really about determining:
In this case, the monthly payment is higher, but the chances of greater annual appreciation are also greater.
Now that you are weighing your options, you might think to yourself, "Hmmm…I am not really comfortable with a monthly payment increase of $550. But I am okay with $300."
Hooray! You now know this homeowner's Move Mark! Now that you have this number, now you get to be creative! What tools do you have access to that can help with that? What about:
I encourage you to check with your lenders to learn more about the different loan options for your clients to explore so you have the tools ready to help.
Now, what if this seller's Move Mark was more about downsizing to something like a condo but they didn't want to spend more than their mortgage payment taking into account an HOA fee? Now that is a different type of conversation to have and problem to solve.
The key point to remember here is that in this market, you can't just be an order taker and expect to thrive. You need to dig in, have what-if conversations with your homeowners and buyers, learn about their pain points, and get real about what it is going to take to move. Talk about things like the Move Mark because, when interest rates come down, that might be enough of a dip to get their Move Mark in target range. However, what if that gets more buyers to come back into the market, prices may go up, there may be multiple offers, and they are still missing the Mark? In this case, it may make sense to find a lender that offers a free or low-cost refinance program as indicated earlier.
Pick up the phone and schedule some Move Mark conversations with would-be home sellers today!
By Denise Lones CSP, CMP, M.I.R.M. - The founding partner of The Lones Group, Denise Lones, brings nearly three decades of experience in the real estate industry. With agent/broker coaching, expertise in branding, lead generation, strategic marketing, business analysis, new home project planning, product development, Denise is nationally recognized as the source for all things real estate. With a passion for improvement, Denise has helped thousands of real estate agents, brokers, and managers build their business to unprecedented levels of success, while helping them maintain balance and quality of life.