RealNews RoundUp
Each week I round-up the best real estate articles and break them down for you in an easy to digest format. Here are the articles I’ve found most interesting over the last couple weeks:
The Article: Inman, 10 Ways to help real estate clients overcome commitment issues
The Highlights: Commitment issues can happen with any big life decision—home buying/selling included! It’s not uncommon to experience cold feet or decision paralysis. The article gives 10 tips to help nudge clients (buyers AND sellers) in the right direction. The article expands on each point with helpful examples, but to summarize they suggest to:
1. Build rapport
2. Educate them about the market
3. Ask the right question
4. Don’t rush them
5. Be transparent
6. Highlight your expertise
7. Provide clear communication
8. Customize your strategy
9. Set expectations
10. Be patient
My Take: I appreciate how this article is well-balanced and takes the client’s interest into consideration above all else. There is nothing worse than an overly pushy salesperson, especially when the stakes are high! Pushing hard might get you the sale short term, but forward thinking is essential in real estate. Pressuring clients to make a decision, or not exercising patience creates a lack of trust that will ultimately harm your business and your standing in the community you serve.
Realtors help coach clients through (likely) the largest financial decision of their lives. It’s a huge responsibility that everyone in the business should take seriously. I think these tips are great because they strike the balance of respect for your client while keeping your foot on the gas.
My favorite tip: Set expectations. The article says,
“One of the biggest reasons why clients may hesitate to commit is that they aren’t sure what to expect next. In your first meeting with them, it’s a good idea to set clear expectations about the process and what they can expect from you as their agent.
Creating timelines and deadlines and using tools such as checklists can help prepare them for what comes next and help alleviate any anxiety about the process, making them more likely to commit and stay committed.”
This is a great tip that helps keep you in touch while your client works out the kinks.
Article: Keeping Current Matters, Owning your home helps you build wealth
The Highlights: The article purports that even with today’s high interest rates and high home prices, it’s ultimately better to buy vs. rent as a means of building long term wealth.
Even across various income levels, homeowners have a much higher net worth than renters who make the same amount:
The reason for this discrepancy? Equity! Homeownership allows your asset to appreciate over time (you pay down your loan, and the housing market appreciates—on average 2%-4%/year) and any smart improvements you make over the course of living in the home will be returned at the time of sale.
When you rent, you help your landlord gain equity, but you don’t receive any benefit beyond having shelter.
My Take: The question of rent vs. buy is often more complicated than many articles like this account for. Yes, the numbers are hard to argue with, and I’d recommend everyone make homeownership their long-term goal, but it’s still one of the biggest financial decisions of your life, and your personal circumstances should be considered before diving in.
For instance, if you’ve just made a big cross-country move, you may want to get to know the area before you settle into a part of town that’s not suited for you. Check out some more reasons renting might be the right choice HERE.
Once your life circumstances make sense for homeownership, I would recommend buying as soon as possible. Save for a down payment (the amount needed is probably less than you’d think!) and get in the game!
The Article: Forbes: Demand for office space could fall by 13% by 2030, and that’s not the severe forecast
The Highlights: A new report finds that office attendance has held steady at 30% below pre-pandemic levels, and that even by 2030, demand for office space will be lower than it was in 2019. In more severe projections, demand could fall by 38% in some cities.
The staying power of hybrid work, in addition to a worsening economy is clearly having an impact. In a recent survey of 13,000 full-time office workers across six countries, 56% had a hybrid work arrangement, 7% worked fully remote, and the remainder were on-site each day.
What’s more? Even highly paid, senior-level workers say they would quit their job if they had to go to work onsite every day, even being willing to trade pay for the privilege. Even the top-dogs want hybrid work it seems!
My Take: Flexibility is king! This revelation is nothing new—it’s been 2 years of (unsuccessfully) trying to get people back into offices. It’s a great personal perk, BUT a shrinking need for office spaces, combined with the continued decline in retail shopping are having an impact on the overall economy that’s not-so-great.
Values of office and retail spaces are already down 11% from peak levels, and it appears a commercial real estate crash looms. Here’s where things get even more harrowing: Small banks hold a massive $1.9 trillion in commercial real estate debt—a much larger figure than large banks.