Steps to Remaining Competitive in a Failing Market
Real estate has been such a hot market for such a long time that quite a number of agents entering the industry at that time have yet to acquire experience working with the buyer's market. Certainly, until the recent crumbling of the market, sellers were definitely favored. Homes were sold quickly and often even above the asking price. As such, buyers discovered that they needed to act quickly; so quickly, in fact, that it became quite the norm for buyers to grant a waiver of property inspections among other basics to allow the process to progress as rapidly as possible. Buyers knew very well that sellers during this time often received multiple offers and this could often easily escalate into somewhat of a bidding war.
With the housing market continues to decline, however, there has been a shift in the rules now giving buyers the power. They now retain the luxury of being able to take as much time as they need in the process instead of having to rush through just to get the property they want. As such, an agent's success in the market hinges on their understanding of the elements of current market conditions.
Whereas it was once possible to earn a significant amount of money by showing just a few properties during a seller's market, agents must now prepare to accept that this is no longer a reality and so surviving the current market requires a full understanding of the realities involved.
One such reality is that, in this current market, homes will take no less than six months to be sold and in fact, some properties may take a significantly longer time to sell. When compared to the previous seller's market where hours or days was all the time it took to sell a home, the changes in the market become very clearly apparent. This problem can be combated by some simple steps which include making sure that properties receive the highest level of exposure possible, particularly as it relates to the internet. Virtual tours a multiple high-resolution photographs are useful tools in the process. It may also be a good idea to offer increased commission fees for buyer's agents that list your properties as priority.
While facing the realities of this housing market, you must ensure that sellers also face those realities. Many will continue to operate on the basis that will still be able to attain prices comparable to those that existed not long ago and as such, many buyers remain unrealistic in the prices that they hope to obtain. It is imperative that sellers are gently introduced to the current realities of the market. For instance, one must be aware that at any given point during the current market conditions, there is likely to be an inventory back load of about six months. Even in markets that have not been as severely affected, properties need to be accurately priced to avoid lingering on the market unnecessarily.
It is wise to try shifting your marketing plans along with shifts in the market. It should be specifically understood that the majority of areas will now be a buyer's market. As such, more time needs to be allocated to the development of buyer leads so as to achieve liquidation of most of the inventory currently up for sale. This does not by any means mean that new listings should be avoided; nevertheless, you will need to work diligently at attaining new buyers in order to balance out these new listings. A great buyer lead source, particularly for first-time buyers, can be found in rental properties. A down market will provide significantly more renters than buyers.
Most renters do not do so because of choice. If buying is clearly to their advantage and they are provided with all the necessary information to help them make it a reality, most persons will opt to purchase a home rather than rent one. Consider offering free seminars on home ownership which you will advertise in the local newspaper as well as by posting flyers.