Reviewing the rate issues at hand, job losses, and more homes on the market with fewer buyers, one of the most basic questions that you should be asking is.... "Who's buying homes now?" And we can take the next step to a larger question at hand. "Who will be driving the residential real estate market?" And "Who is my business."
There are a few key emerging markets transpiring. The baby boomers & echo boomers, single women, and the Hispanic sector. Basically trying to understand these markets by figuring out how they influence the market and where to find them.
We need to educate ourselves by training each other or your organization about the specific desires and concerns of these three critical groups. By doing this, you will be better poised to successfully sell to these customers.
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A. Baby boomers
This traditional economic powerhouse behind the U.S. housing industry trends has for a long time been that generation born between 1946 and 1964. We call this group the baby boomers.
Many investors believe as this group turns into their 60's that many of them will move their investments from the stock market into real estate. And this is good because this group seems to be more responsible which has propelled record numbers in the second home/vaction home sector.
According to the National Association of Realtors (NAR), in 1980, only about 150,000 families owner second homes. Now second homes account for more than one-third of all homes purchased.
I had the chance to talk to Colleen Kulikowski this past Sunday and she mentioned that we would be a good connection because many of her clients buy 2nd homes in Florida. Especially for the fact that she lives in Marco Island, Florida. And she went on to say that many of these refinance their homes in NJ to buy in Florida and that they do fall into the baby boomer group.
Marketing the savvy baby boomer
Keep in mind that baby boomers grew up in the turbulent, idealistic '60s and this generation is characterized by values. This group is far more active, health conscious, and are redefining retirement.
Remember that baby boomers are sophisticated shoppers who have historically been brand loyal. At times, think American or for some us, think of your parents and their friends. You can also compare them to the younger generation which for the most part, proves these examples.
To effectively reach this group, your marketing and customer service should demostrate both respect and good manners. These baby boomers respond to soft selling techniques that emphasize them and their needs and make them feel like winners. Don't play the gimmicks and provide solid, concrete information about your product and services. In regards to loans or real estate from this group, if they have a positive experience, they'll probably tell their pees and generate additional referrals. Take the time to earn their trust. This just happened to me today. I refinanced an older couple in Georgia and it was just the way I treated them and serviced their needs. But at the end, he sent me a letter thanking me for all of my help and always being available. And that they don't forget things like this and would be honored to send me their friends, family, and people from their church. This is a great feeling when you get a letter like this. And I think it helped that I had the title clerk go to their house around 7 pm.
And here is a startling fact to think about. Over the next decade, baby boomers stand to inherit even more money, around $41 trillion. You could then concentrate your messaging efforts on why it's still a good idea to have a second home. Emphasize the tax savings and underscore that they'll remain diversified in their assets.
- B. Gen Xers & Echo boomers
The Gen Xers are born from 1964 to 1981 and then you the Echo boomers which were born from 1982 to 1995. Echo boomers are also referred to as "Generation Y".
Looking ahead, 37 percent of the Gen Xers and 27 percent of the echo boomers plan on buying new homes. And these homes will be bigger and better than what we see now. These two groups are unlike their parents because they are more risk takers and have a multitude of affordable mortgage options to choose from, as well as historically low rates. And with parental help in regards to their down payments and closing costs, this group has fewer barriers to securing mortgages. I have seen this off and on since I have been in the mortgage industry since 1992.
These two groups have more of an attitude of what I can have and are characterized by the fast-paced schedules and a team attitude. Effective marketing to these groups would require techno-savvy techniques and vehicles to attract these 2 specific groups. 42 percent of the buyers who use the internet to search for a house are 34 or younger. Making the mortgage process simple and efficient, will hook these buyers who expect instant gratification and quick results.
Conclusion/Summary:
Selling to these groups would require that you focus your services and products to meet the unique needs of each group. Take time to review your marketing and communication strategies to ensure that the tone and values that you convey reflect the core dynamics of each generation. Whether your customer is entering the prime of his life or just getting started out of college, the importance of you delivering the right message would be an effective format and likely enhance your business.
Top Trendsetters series for your market areas:
- FHA Loans - USDA Loans - Conventional Loans - VA Loans - Mortgages - Experience & Knowledge at its BEST !!!
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For more information on FHA loans, please go to this link. The FHA Expert
For more information about the 2008-2009 Tax Credit for First Time Homebuyers : 2008 Tax Credit
For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags !!!!!
Copyright © 2006 by Jeff Belonger
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