Just Some Thoughts

You know real estate is really a strange and complex commodity, yet at the same time it is extremely interesting. It is always difficult to predict where we are heading primarily due to the fact that so many variables impact its direction. Interest rates, employment, consumer confidence, gas prices, you name it and it is likely to have some influence on the real estate market. I suppose you could say that about other products as well. The demand for automobiles rise and fall on these elements too. Throw into the mix the very personal and emotional nature of a home purchase and the unique nature of the product itself and you have a different breed of cat.

Real estate is unlike anything else. You may think you just won’t survive without that red Lexus coupe that represents your heart’s desire and although you have looked everywhere you just can’t find one. Hold on a minute, they’ll order one for you. Try that with that 5 acre parcel of beach front property, where the sun sets just right behind that little grove of pine trees. Oh my, it was sold to someone else and no, I can’t order you another.

It’s that emotional aspect that makes the business such fun, while at the same time being so frustrating. You have a client with a certain set of housing parameters, initially it is invigorating, the thrill of the hunt, but soon it all turns frustrating as the prey appears illusive. Nothing is more exasperating for the real estate professional than having nothing to show a bona fide client.

You may be thinking, what’s so difficult about finding a six room split in the blah blah school district, they’re everywhere? Perhaps, but when someone looks at five homes, that to you may look just the same, and selects one of them, something tripped their switch, that’s the challenge finding the trigger. I once had a sales trainer who said to me, when we were on this subject, “I bought the trees and the house came free.” You have to be able to identify your client’s “trees.” Some of our colleagues aren’t up to the challenge, they take the coward’s way. If you are in the $120,000 price range, they will show you everything in that price range and then some, kind of the “kill them all and let God sort them out,” approach. These folks don’t get the art of it and their clients all have “house indigestion” from looking at so many homes. Who is going to be the happier client? The one who spent weekends for months in their agent’s Taurus, wondering why they are looking at two story homes priced at $150,000, when they had been pre-approved for $120,000 and specifically asked to see only ranches. OR the client who looks at three homes and buys one and leaves the transaction feeling like someone was listening to them. Real estate “sales” is really a misnomer, we aren’t selling anything, we are searching for the property that you described and when we find it, you’ll buy it. We are sort of like matchmakers. And what kind of matchmaker would we be if we just had you date everyone, no profiling, just “here’s another, give him/her a try and let’s see?”

WOW! How I do go on! This has been the world’s longest lead-in, to tell you that this spring is going to be a very exciting market for those of us in the profession. From our point of view, the stars couldn’t be in better alignment.

First and foremost, we have great mortgage rates, right around 6%, that puts your monthly payment at $6 for each $1,000 you borrow (want to borrow $100,000, that would be $6 times 100 or $600). Mortgage money is plentiful, with numerous mortgage programs available to suit most needs. There is one proviso here however, due to the near crisis situation regarding foreclosures, the Government has begun looking closely at some of these fringe mortgage programs that enable people who probably aren’t ready to purchase (but that is a whole different article). We have relatively stable employment in our market. Locally, consumer confidence is strong and why not – the Penguins are staying! The economy is generally good AND the supply of homes from which to choose is fantastic. This last feature is the one thing that separates this year from the previous four glorious spring markets; our frustration quotient is going to be quite low, as we will likely be able to find what our clients are seeking.

All of these things make housing very available and very affordable, making Spring 2007 a great time to buy your dream home. Therefore, it goes without saying that if it is a good time for buyers to be in the market it is only natural that it would also be a great time to sell. So get out there, do your deal and take advantage of the American Dream.

Gary Straub is an independent real estate consultant and real estate professional for 36 years.