Buyer power today

I am looking at my power and light bill.  And my gasoline bill.  And my grocery receipts, clothing receipts, and others and no longer wondering why I don't have enough cash at the end of the day for my favorite latte "treat".

Last year at this time, my power and light bill for my home was $246, this year it is $305.  My grocery bill was about $120 a week, this year it is about $200 a week (and not because I am buying more - eggs for example were 69 cents per dozen last year, and $1.73 this year - I found an old grocery bill).  My gasoline bill was about $350 for the month last year, this year it is almost $600.  So what's wrong with that?

Well, our incomes are not keeping up with the general cost of living, and we are literally running out of money instead of puting it in savings! 

What does that mean for business?

Lower interest rates notwithstanding, buyers are more cautious about the dollar amount they spend on the properties they are considering.  I am getting close to closing on one in particular that stands out.  The couple in question can afford almost double the home that they are purchasing, but because we are in a perceived recession, they have opted to buy less home now to make sure they can afford to feed their children next year (not knowing where food and gas prices are going).  This is something I have actually started counseling my buyers to do - if I am feeling a crunch, I know others are, too, and it has nothing to do with being irresponsible with my mortgage (we have a 30 year fixed at 6.1%) or living large (our last big purchase was a car 4 years ago) - our vacations consist of the camper or tent and driving in some direction until we find a state or national park to rest in, and we only eat out once a month as a family. 

So this year, my buyers will buy smaller or less expensive homes to offset the dramatic increase in the cost of living, and I for one am good with that. 

Sell responsibly.  Friends don't let friends oversell.