What are some things we can tell buyers to convince them to buy?

Asked by Eager Buyer, 29401 Wed Mar 4, 2009

I was thinking about telling them stuff like (1) interest rates are low (2) inventory is high so there is great selection and (3) that RE never goes down in value. Not sure how to get around the fact that prices are going down, the economy is terrible and nothing is selling. Any ideas would be helpful.

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37
Jeff, , Virginia Beach, VA
Thu Mar 5, 2009
BEST ANSWER
Wait 6 months, save another 20%.
1 vote
Mirela Monte, , 29582
Sun Mar 8, 2009
Religion, sex and money are all deeply personal decisions. A coined answer to the original question is almost impossible. Having sold and invested in Real Estate for the past 20+ years, here is MY view on the subject:

An improperly trained agent is as dangerous as a Buyer or Seller transacting Real Estate without proper representation; maybe even more dangerous…

A good Realtor is worth his weight in gold, or at least silver. A good agent:
1. Cares about his clients and watches out for their money as if they were his own.
2. Is extremely well trained and up to date on Real Estate Law, Methodology, Trends, Statistics, Economics, etc.
3. Is ethical and has a good moral compass.
4. Is a good reader of people and knows how to debrief his clients. He asks the right questions in order to determine the exact, unique needs his clients have “right now”.

Things to consider about Real Estate and today’s market:
1. Plenty of inventory with a plethora of Bank Owned properties available for sale in many markets. Banks are not subjective sellers; they are not in the business of owning Real Estate and want these properties off their books asap, which COULD mean exceptional deals for the savvy investors. My investors have bid as low as 33% below fair market value (which may be different from “appraised value”… appraisals are still coming in too high) and got the deals approved. (Now you understand the value of a good agent… What I can do to present these offers correctly, stay on top of them and garner bank approval, no one else can do, unless they have 20+ years of experience and an enormous amount of training, not to mention the ability to think outside the box and be a “dog with a bone” as I’m often referred to).
2. Although it is now a lot harder to obtain a loan, those few fortunate investors who qualify can get money at a very low cost.
3. Instead of speculating where the prices are going next, I endorse a different approach: do your analysis of the particular property you are considering buying. Add up all the costs involved: Principal, Interest, taxes, insurance, hoa dues, property management costs and any other expenses associated with that property. Figure out how much rent you could charge for that property. Establish a realistic fair market rent. Subtract all your expenses from that figure. If you come out close to even, or you make a bit of money on it, go ahead with the transaction. When you figure in the depreciation on your taxes, your actual figures will be even more glowing… Someone else will be paying for your asset, while the value of your asset is going up (you have to look at it long term, not as in next month, or even next year).
4. If you are concerned with buying at the very bottom of the market dip, you have to be very much in tune with the market. Quarterly absorption rates are a good indicator of these, but there is true danger of missing the boat on the lowest prices, for no matter how careful or analytical you are, by the time the figures present themselves, it may be too late.

I hope this helps. BTW, I am not available for hire, as I am fully booked for the foreseeable future. I will, however, answer your questions, whenever the time permits. There is a reason they call it REAL estate: all the data is public; you don’t have to rely on BS from CFO’s spewing “doctored” data about their corporations… Also worthy to note:
1. The richest people in the world are deeply invested in Real Estate.
2. Everyone needs a roof over their head.
3. Real Estate is cyclical and we are currently in a dip.
6 votes
Alan May, Agent, Evanston, IL
Tue Mar 10, 2009
I never try to tell my buyers ANYthing that will "convince" them to buy.

The entire concept is that I don't come into play, UNTIL my clients have already made the decision to buy. Then, and only then, I try to help them with the process and transaction. If they're not already convinced that they want to buy a home... it ain't my job to pressure them, convince them or otherwise coerce them.

Period.
3 votes
J R, , New York, NY
Sun Mar 8, 2009
Please don't feed the trolls.
3 votes
Thomas Cunni…, Agent, North Myrtle Beach, SC
Wed Mar 4, 2009
Eager,
Have you considered the idea of expressing that Prices on most homes and properties out there have reverted back to 2001-03. Prices. That with the influx of Short-sales, REOs ( Bank Owned ) properties, prices are dropping to amazing a point where it's a huge Buying opportunity?
Nobody is going to be able to predict how much further prices will continue to fall, if they continue to fall at all. Yes, your statement of "Interest Rates at an all-time low" "inventory is High" are both true and provide an opportunity! But, the comment on " RE never goes down in value" is just plan silly!! This economic situation we're all facing is new and unique. We have never really seen an RE market like this and because of that, it makes it impossible to predict which way it will continue to go.
My strategy is simplistic, Be honest, Be current and more importantly, be helpful. Nobody wants a " Used Car Salesman" The new consumer is Educated and in most cases, more up-to-date then most of the Real Estate Agents out there now!! The concept with any investment is simple, buy Low and Sell High..... So, with that being said, if you have buyers that have interest but are sitting on the fence; First quiz them and see if buying is even financial possibility for them and understand why they want to buy right now. Second, buying an investment on a downturn is the best time to buy, period!! You already know that prices have dropped and may continue to drop. If you purchase your property while the market is down, your basically insuring the fact that when the market turns around ( and it will !!! ) your purchase will garner you a nice return, especially if you are buy that property for a price that was dated almost 10 years ago!!
If my logic here is skewed, by all means share with me where I'm wrong.... Here's my advise, take or flush it. It's yours to do with however you please!!
3 votes
Bill Eckler, Agent, Venice, FL
Sun Mar 8, 2009
What's with recognizing, "wait six months, save 20%" as the BEST ANSWER?????????

Does the party making these determinations, have a clue. This is a sad reflection on Trulia's reputation to provide factual information.

SORRY.................
2 votes
Eager Buyer, , 29401
Thu Mar 5, 2009
Thanks for all the great insights from the PRO'S!!!!

My favorites are:

"Yes, they can wait until then, and there will still be some great deals, but there are probably even better deals right now! "

"RE has never gone down in value IF it is held long enough. " (This may be the silliest thing I have ever heard.)

"If you purchase your property while the market is down, your basically insuring the fact that when the market turns around ( and it will !!! ) your purchase will garner you a nice return, especially if you are buy that property for a price that was dated almost 10 years ago!! "

"If they are renting then they will stop paying someone else mortgage for them"
2 votes
J R, , New York, NY
Wed Jun 17, 2009
"Didn't you get the memo", I considered an opinion.

Since I am always right, don't try to argue. That would be a problem, because you are always right too! :)
1 vote
Charita King…, , Downey, CA
Tue Jun 16, 2009
You may be dealing with buyers that are not ready to buy. I would say focus on the buyers that are ready.
1 vote
Peter Testa, Agent, Bethel, CT
Tue Jun 16, 2009
Best advice I received on selling a buyer is... ready?

You don't push buyers into a sale, you pull them in.

Brilliant
Web Reference:  http://www.PETERTESTA.com
1 vote
Jeff, , Virginia Beach, VA
Tue Mar 31, 2009
Realtors are going to have to start pre-qualifing their clients so they don't get any remotely informed ones.

Pre-qualifying questions (any yes answer is instant disqualification)

1. Do you own a computer?
2. Can you read?
3. Do you listen to or watch news programs?
1 vote
Mikem, , 01803
Tue Mar 10, 2009
Nothing is selling? Not a sinlge house sold in the last year where you live? Come on now, upset people (not sure what they are upset about though) claiming that not a single house has sold in the last two years and that prices are dropping 20% every month are more annoying than the 'real estate always goes up" agents ever were.
1 vote
Mirela Monte, , 29582
Mon Mar 9, 2009
Jeff: Don't worry; I'm not competition, so you don't have to insult.

DP2: Thank you very much! That was very kind of you!

JR: Regardless... I think the thread here has established itself as worthy.
1 vote
Dp2, , Virginia
Mon Mar 9, 2009
Mirela, that was an amazing answer. We need more agents like you.

However, I have only one minor point of contention with your answer. I've encountered agents who claimed to have 30+ years of experience who are ineffective in this market. I suspect your wisdom and skills are more a reflection of the fact that you're constantly seeking to learn more, and do more deals. You also appear to have the right attitude, and a passion for real-estate.

Plus, your background as an investor gives you a decisive advantage over many other agents who don't also invest, because you've learned multiple ways to work your deals, and you understand how we (investors) think and operate.
1 vote
J R, , New York, NY
Mon Mar 9, 2009
Wow. The Pro's are out in full force with this one.

The question is basically how to convince someone to buy when it is not a good time to buy.
~~~~~~~~~~


Posed by a troll. I'm actually amazed anyone's powers of discretion didn't kick in on this one.
1 vote
Barbara Q., , Bergen County, NJ
Sun Mar 8, 2009
Jeff- Why wait 6 months for a 20% discount when
321ADVANTAGE Sellers offer a 28% discount TODAY?

Canned pitches tend to be annoying and condescending...but ...Numbers don't lie!

PLUS- Waiting is a crapshoot.
Values may be lower in 6 months- BUT interest rates MAY be higher...
which potentially eradicates the decline in value.
Example:
$480,000 today at 5.50% = $2,712/month P&I
$400,000 later at 7.25% = $2,712/month P&I

That's why our Sellers understand that...PAYMENT SPEAKS LOUDER than PRICE!
Web Reference:  http://www.321advantage.com
1 vote
Thomas Cunni…, Agent, North Myrtle Beach, SC
Thu Mar 5, 2009
Dear Eager,
Do you happen to have any places I can rent?? I have several people looking for some rentals in the Charleston Area, preferably Downtown or James Island. Got any suggestions??
I figured I could certainly turn to you as you are a ( Self Proclaimed) expert on the advantages to renting!!
Could you possibly own any property yourself, or are you strickly a "renter"??
It never ceases to amaze me how "anonymous" people have the most negative things to say on any public forum, yourself included.
How did you become such an " informed" individual??
1 vote
Hoang, Home Buyer, California
Wed Mar 4, 2009
(1) Prices only go up. ( Housing's price 2009 is still expensive then 2001 )
(2) It is never a good time to rent. ( To be renter is nothing bad )
(3) Rates are low. ( In history, except last few months )
(4) Listings are high. ( Unchange in last 3 months )
(1) Prices are dropping. ( Yes It's, It bring average income worker into market )
(2) The economy is going bad. ( No one know It will be worst or better in the future, last recession last for 4 years )
(3) Sometimes renting can be much much cheaper than owning. ( Rent the apartment is cheaper than own the house )
(4) You lose 6% by using a Realtor. ( Don't sell then )
(5)No homes are selling right now. ( California sell increment 100% compare to jan. 2008, nationwide sell 5 millions units for 2008 )
1 vote
Thomas Cunni…, Agent, North Myrtle Beach, SC
Wed Mar 4, 2009
Ha HA..........
Eager,
You sound a bit scorned But, I'm enjoying your sarcasm immensely. Your first mistake is trying to devise a "Pitch"!! Maybe ( you )feel that Realtors are unnecessary and your fully entitled to your opinion, but explain how it would be beneficial to an individual to go out there, on their own, and to some degree navigate blindly to make such a large purchase in their life. What's so wrong using someone who has spent years watching the market trends of their area, going through the trenches dealing with all the crazy situations that can arise when purchasing Real Property??
Your " Pitch " is great.... I advise you to go with: with more people like you out there trying to get people to buy, using your "well devised Pitch" then more and more people will eventually find their way to honest, hard working Realtors who will do everything they can to help them both find and purchase a property for the best price possible, at that time!!
1 vote
Mark Brian, Agent, Anderson, SC
Wed Mar 4, 2009
I agree with Thomas in North Myrtle, be honest, helpful and have the stats. Forget about some catch phrase to use to get them to sign on the dotted line, forget about being pushy. Do not say blanket statements that predict the future such as RE never goes down in value. You are leaving out the most important word-IF!

RE has never gone down in value IF it is held long enough. Do not leave out that important part regarding holding the property for a long enough time period. Also try not to predict future market trends about housing prices going up or down, but instead show facts and figure to show possible scenarios. Be an expert in your market, not a fortune teller.

Read Thomas's answer again and again.
1 vote
Voices Member, , Benton County, OR
Wed Jun 17, 2009
J R I just pasted what Ron Phipps, 2009 NAR First Vice President said.

I didn't say anything about it was true or not..

If I had expressed an opinion you know I wouldn't have been wrong! ; )
0 votes
J R, , New York, NY
Wed Jun 17, 2009
Is there something wrong with telling the truth, Dunes? Interest rates are on their way up, but are still way down. There's the 8,000 First Time buyer credit. My county is offering grants. Likening real estate to a buzzing hive right now is true. I am working with a buyer, we picked out a home to see, it was listed on the 9th, it is half in contract today. I am constantly getting phones calls from first time buyers. They are frustrated because as soon as something is listed at a price to sell, IT SELLS. Immediately if not sooner. IN my area, if it's priced around 250,000 it barely makes it to MLS. The sad thing is, there isn't much priced around 250,000, even though there's a lot that should be.
0 votes
Voices Member, , Benton County, OR
Wed Jun 17, 2009
Didn't you get the memo..

REALTOR® Bees Busy Generating Honey, Posted by Ron
Spring 2009 has arrived, and real estate has the sound of a bee hive. You can hear it and see it. Realtor® bees are busy making stuff happen. After the long dormant housing winter, the hive is active and Realtors® are making honey. This is a nectar that all of us live off of -- economic activity. The road to recovery in every major recession of the last century began with a revival in housing. We Realtors® are doing our part to lead now.

We have had to temper our message from it is the right time to buy; to it may be the right time to buy. The preface to our message is that you need to have good credit, a job, and realistic expectations before you can sincerely realize the American Dream.

With lower housing prices, historically low interest rates, strong income, and the $8,000 first-time home buyer tax credit, this is the best time to buy since NAR began keeping records on housing affordability 39 years ago. All of the elements converged to make this a superior time to purchase.

Sometimes this call to action sounds self serving because Realtors® earn a fee from completed transactions. While this is true, it is not the compelling factor in the argument to encourage people to buy now.

There is a more important message: in the long run, home ownership is a great choice for families, for communities, this country, and the global economy. For individual families who own, they are 38 TIMES wealthier than families who rent. When you look at the multiplying effect of this wealth, you will see it generates lots more economic activity. In the long run, the equity that one ‘earns’ by paying off their mortgage reduces their need for government assistance as one ages and gives one an asset to use to pay for life expenses. As you can see, long term home ownership is superior.

As Realtors®, our challenge is to encourage people to own, and acquire, but with appropriate prudence. Encourage your clients to buy and own something that they can afford. That’s the best way to make honey this spring! – Ron Phipps, 2009 NAR First Vice President

You could also start getting this stuff to help.. http://www.realtor.org/prodser.nsf/products/141-319?OpenDocument
http://www.realtor.org/pac.nsf/pages/pachome?OpenDocument&am…
You could study this... Why Use a REALTOR®
http://www.realtor.org/home_buyers_and_sellers/why_use

Check with NAR don't you pay them to come up with your ideas?

Help this helps you get some "stuff" to tell them.

Dunes
0 votes
Why Buy? Ren…, Both Buyer And Seller, Wilmington, NC
Tue Mar 10, 2009
#1 post of all time. My hear goes out to the first girl, Jackie:

"If they are renting then they will stop paying someone else mortgage for them and start building equity in their own home. Even though prices are going down people usually buy homes for the long term so by the time they are ready to sell, equity will be there."

I mean she just told Eager Buyer that ir prices are going down it is a goo time to buy?!

This guy should be an NAR trainor:

"Wow - these are great. Here is my pitch:

(1) Prices only go up.
(2) It is never a good time to rent.
(3) Rates are low.
(4) Listings are high.

I will not mention:
(1) Prices are dropping.
(2) The economy is going bad.
(3) Sometimes renting can be much much cheaper than owning.
(4) You lose 6% by using a Realtor.
(5)No homes are selling right now.

Is this basically what the "Pro"'s use?"

We all need a laugh at the expense of the so called "REALTORS" sometimes.

I hope no one really buys a house from all these complete made up reasons.
0 votes
Palmetto Guy, Both Buyer And Seller, 29407
Tue Mar 10, 2009
Wow. Eager Buyer sure got these REALTORS on this one. They seem to have a ton to respond though.
0 votes
Mirela Monte, , 29582
Mon Mar 9, 2009
Mr. Fsbo: if you are alluding to my answer, please read it again! Here is a quote from it:

"Religion, sex and money are all deeply personal decisions. A coined answer to the original question is almost impossible."

Did I say it's time to buy? I believe that if you READ my answer, you will see that I do not give a blanket green light to buying. Am I buying? Yes! Are my many investors buying? Yes! Am I advocating buying? I believe I've answered that question in full in the many paragraphs below.

I would appreciate an intelligent conversation here, instead of lame accusations! It is easy to hide behind the anonymity of names such as fsbo, or eager buyer, etc. I am participating here with my full name and address. I hope to shed some light on some of your concerns.

It is very easy to be ugly. I will not participate in anything negative and my answers will stop here. If you would like to continue this discourse, please make this a positive and constructive discussion! That way we could all learn something here.
0 votes
Mirela Monte, , 29582
Mon Mar 9, 2009
Dp2: You're absolutely right! Experience alone will not confer the knowledge necessary to succeed in this market.

Passion has everything to do with it. Constant and continuous erudition is the other part of the equation. In this volatile and rapidly changing market one can not afford to be complacent. I suspect some of those agents you are mentioning believe they know it all...

Being an investor also helps. Indeed, how can you understand the mentality without being in the game?
0 votes
Save 6% Fisbo, , Milwaukee, WI
Mon Mar 9, 2009
I have never seen a better example of the length Pro will go to keep up the "Great time to Buy!" line.

That is the response to EVERYTHING.

What i can not figure out is why the take so long to explain it. It is funny how the non-Pro's can answer in a few lines and The Pro's ramble on for 6 para's about tnoing other than it is a good time to buy.
0 votes
Save 6% Fisbo, , Milwaukee, WI
Mon Mar 9, 2009
Wow. The Pro's are out in full force with this one.

The question is basically how to convince someone to buy when it is not a good time to buy.

Eachp Po chimes in with long answer. Makes you wonder?
0 votes
Rent4life, , Cleveland Heights, OH
Fri Mar 6, 2009
GREAT TIME TO BUY!!!!!!!!!!!!!!!!!!!!!!!!

Other than this news: http://money.cnn.com/2009/02/24/real_estate/Case_Shiller_December/

Home prices down 30%. (36% when you use a Pro)
0 votes
Save 6% Fisbo, , Milwaukee, WI
Fri Mar 6, 2009
Also tell them that as Buyers thye get a free agent. That is really helpful.

Do not forget either that they will get to paint it whatever color they like.
0 votes
Rent4life, , Cleveland Heights, OH
Fri Mar 6, 2009
This is the funniest thing I have ever seen.

The only thing they left out was that buyers agents are free. That is always a good one. That you will stil have to pay full commission if you do it on your own.
0 votes
Dp2, , Virginia
Wed Mar 4, 2009
Nice post. :)

I'll spot you one more: "you won't get wealthy renting" (even though businesses do it all of the time).
0 votes
Luke, , Nashville, TN
Wed Mar 4, 2009
Lol.....what a great thread...This was worthy of a good chuckle.
0 votes
Eager Buyer, , 29401
Wed Mar 4, 2009
Wow - these are great. Here is my pitch:

(1) Prices only go up.
(2) It is never a good time to rent.
(3) Rates are low.
(4) Listings are high.

I will not mention:
(1) Prices are dropping.
(2) The economy is going bad.
(3) Sometimes renting can be much much cheaper than owning.
(4) You lose 6% by using a Realtor.
(5)No homes are selling right now.

Is this basically what the "Pro"'s use?
0 votes
Eager Buyer, , 29401
Wed Mar 4, 2009
Totally forgot about the throwing your money away by renting one, thanks!
0 votes
Jackie Stewa…, Agent, Westbury, NY
Wed Mar 4, 2009
If they are renting then they will stop paying someone else mortgage for them and start building equity in their own home. Even though prices are going down people usually buy homes for the long term so by the time they are ready to sell, equity will be there.
0 votes
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