Advice Your Buyers Are Getting: The Good, Bad, and Ugly

By
Services for Real Estate Pros with www.PrinterBees.com BRE# 01392374
http://actvra.in/4YHG

When someone is ready to buy a home, it’s 99% certain that they are going to look up advice on how to go about the process. Even folks who are not first-time buyers look for information because they assume, correctly, that the market has changed a lot since they last purchased.

It’d be great if people took advice from you or another qualified professional, but unfortunately, they don’t. As a result, some of the information they receive is good, some is bad, and some is downright ugly.

However, being a great buyer’s agent means knowing what people are being told and how you’ll react to common question and objections. To help, here’s a list of popular advice given to buyers and how to be ready to respond.

“Don’t Buy in a Renter’s Neighborhood”

The Advice:

The idea with this advice is that it only takes a few bad renters to make the neighborhood undesirable to both the buyer and any potential residents that the client may eventually want to sell to. Similar advice is to be sure there are families on the street if you plan to have a family, so your kids have someone to play with.

How to Respond:

First, encourage the buyer to take the long view and realize that things change. Once they have a family, there may be several other families on the street. Or, the families there now may move away. In addition, there can always be renters in a neighborhood. It’s totally outside their control.

Secondly, do your best to match them with a home that fits their needs. Is there an area they could buy in where the HOA prohibits renting? Is there a neighborhood known for great schools that would naturally attract a lot of families with kids?

“Think Long Term – Look for Bones and Resale Value”

The Advice:

A lot of advice to homebuyers, especially first-timers, is to look past the initial appearance. People are encouraged to overlook junk and ignore staging, and just look at the bones of the house. In addition, buyers are encouraged to think beyond today and think about how easy it will be to resell the home in the future.

How to Respond:

First, be sure to point out factors about a possible home that lead to great resale value – a good neighborhood, nearby shopping or schools, and a quiet street, for instance. Avoid showing homes that would be poor long-term investments.

In addition, help your buyers see past staging and make a decision that’s both emotional and reasonable. If a stager put lamps in a bedroom where there are no outlets, point that out. Make sure the buyers know the value they’re getting in a good quality home, not one with pretty “makeup.”

“Know the WHOLE Cost of Owning the Home”

The Advice:

Buyers are frequently told not to budget for the mortgage alone, but also for taxes, HOA fees, upkeep, closing costs, and more. This is great advice because it ensures your buyer is ready to follow through with closing and is much less likely to get cold feet or buyer’s remorse.

How to Respond:

Provide excellent information! Be a buyer’s agent that is truly on your client’s side. Don’t show them homes “just out of range” to try to score a larger commission. That strategy makes the customer feel frustrated and disrespected. Also, it can backfire and lead to a buyer backing out before closing.

By being a buyer’s agent that helps your client understand the full cost of home ownership, you’ll be providing excellent service and generating a lot of good will that will help bring in referrals and great reviews.

“Get an Inspection to Avoid a Lemon”

The Advice:

Buyers are inundated with horror stories of purchases gone wrong and are assured that if they have an inspection, these problems will be discovered before they buy. This is partly true, but not entirely.

How to Respond:

First, help homebuyers be realistic about what they should expect in their price range. If they think they are getting a move-in ready, renovated place with a bottom-level budget, they will be disappointed. Also, help them understand the actual cost of renovation – having a partnership with a contractor they can talk to would be helpful.

Secondly, make sure you have a partnership with an excellent and honest inspector. Let the homeowners know that not all inspectors are created equal and that if they use your resource, you know they’re getting a good one.

Finally, help buyers be realistic about what a home inspection will uncover. An inspection is not a Mike-Holmes-style gut and rebuild. It won’t find everything that might need to be fixed. And repairs are part of owning a home – no inspection will change that.

“Don’t Worry About Being Pre-Approved for a Mortgage”

The Advice:

This is advice that a buyer is likely to get from a friend or relative rather than a buyer’s class or online article. The idea is that a pre-approval isn’t official anyway and that if you’re just starting to look it’s not worth the time or hassle.

How to Respond:

Let a potential buyer know that if they are not pre-approved for a mortgage before looking at homes, they won’t be able to put in an offer on a home they love. It also helps them be clear about their actual budget. Remind them how quickly homes go, and that by the time they get vetted for a mortgage the home they wanted will probably already be purchased by someone else.

You can also choose not to work with buyers who are not pre-approved, to avoid wasting your time. Of course, you should try to convince them to pre-approve before you give up on them.

“You Don’t Need an Agent, Especially if You Buy a FSBO”

The Advice:

People who mistrust real estate agents will tell home buyers to avoid using them. The assumption is that the purchaser and seller are two honest people who will do the deal themselves and cut out the middleman. Both sides supposedly save money.

How to Respond:

This is terrible advice, and not just because Realtors® need to eat. Buying a home is a very complicated process, contracts are incredibly detailed, and inspections, assessments, and closing have a lot of moving parts that can go wrong.

The key is to help home buyers recognize that this is not the same as buying a new pair of jeans or even a new car. They could end up stuck with a home that’s in poor shape, with little to no recourse, because they didn’t handle the legal side correctly. For the biggest investment of their lives, they can’t afford to take that risk.

Are You Ready for Your Buyer?

This article only scratches the surface of the advice buyers receive. By keeping in mind the fact that clients are receiving a lot of advice, much of it from unreliable sources, you are better prepared as a buyer’s agent.

Using your print marketing to address some common misconceptions that buyers have is a good way to build trust and educate your prospects. Whether you need postcards or brochures, Printerbees is here to help!

What’s the craziest advice a buyer has told you they received? Share in the comments!

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
Real Estate Sales and Marketing
Groups:
Real Estate Rookie
Marketing 101
Tags:
buyers
buyers agents
advice for realtors

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainmaker
2,901,799
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

Most advice received from relatives and neighbors is not accurate or wise.

Jan 09, 2017 05:26 PM #1
Rainer
322,489
Dörte Engel
RE/MAX Leading Edge - Bowie, MD
ABC - Annapolis, Bowie, Crofton

Dear Nadine,

Great examples. Often, the advice givers have either never or not recently purchased a home. Sometimes, they are even outright jealous & do not want their cousin to be doing better than them. Real estate certainly exposes us to interesting aspects of human nature.

Jan 10, 2017 04:51 PM #2
Rainmaker
313,527
Melissa Brown
Helen Adams Realty - Charlotte, NC
Realtor - South Charlotte NC Homes for Sale

Oh yes, it is hard to overcome "advice" from relatives who haven't bought a house in this century.  Best to manage expectations upfront with a good buyer consultation before they fall in love with a house!

Jan 10, 2017 04:54 PM #3
Rainmaker
102,088
Greg Kilroy
Keller Williams Sonoran Living - The Velocity Group - Paradise Valley, AZ
the Velocity Group

I find that when I start the process with new buyer clients, by taking them through a buyer consultation - educating them on the process, as well as showing them that I'm professional and knowledgeable, that the outside influence holds much less weight and my clients place more trust in my guidance.

Jan 10, 2017 06:17 PM #4
Rainmaker
266,199
Diana Dahlberg
1 MONTH REALTY - Kenosha, WI
Real Estate in Kenosha, WI since 1994 262-308-3563

Alot of great advise here ... It is our job to educate our clients, one by one ... and if we do that ... as Greg Kilroy stated, outside influence holds much less weight and our clients place more trust in our guidance.

Jan 10, 2017 06:39 PM #5
Ambassador
766,905
Lynn B. Friedman
Atlanta Homes ODAT Realty Call/Text 404-939-2727 Buckhead - Midtown - Westside -- and more ... - Atlanta, GA
Concierge Service for Our Atlanta Sellers & Buyers

Lots of great ideas here Nadine Larder . The start of a great book! Everything that people hear that may not be the best things to believe --- especially the "wait to get pre-approved" bit. All the best - Lynn

Jan 10, 2017 06:48 PM #6
Rainmaker
93,118
Diana White-Pettis
Exit Bennett Realty - Upper Marlboro, MD
GRI, CDPE, CNE, Upper Marlboro Homes for Sale

The buyer consultation is a great way to dispell any advice the buyers are receiving from family, friends, etc.  Great, informative post!

Jan 10, 2017 06:50 PM #7
Rainer
309,821
Rose Mary Justice
Elite Realty Group - Dandridge, TN
Elite Realty Group

You  have summed it up well.  Inform Inform Inform!!!

Jan 10, 2017 07:48 PM #8
Rainmaker
1,213,712
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
your real estate writer

It's amazing how many people become "experts" when giving advice - and when it's not their money or future at stake.

Jan 10, 2017 11:03 PM #9
Rainer
154,136
Chris Lima
Keller Williams Realty-Treasure Coast - Port St Lucie, FL
Local or Global-Allow me to open doors for you.

Great advice in this post.  I believe that this is one of the challenges in our industry. Everyone is an expert and it is very difficult to build trust and rapport that trumps a family relationship. I am a firm believer in consulting with buyers before going "shopping".

Jan 11, 2017 04:37 AM #10
Rainer
70,140
Carol Lynn Johnson
Re/Max Elite Realty - Franklin, NC
Residential Specialist

First time home buyers need a bit more time but it is worth it to show them you truly want to help and have their best interests at heart.  You also just may get a client for life.

Jan 11, 2017 06:31 AM #11
Rainmaker
464,824
Thomas J. Nelson, Realtor, CRS
Big Block Realty - La Jolla, CA
Co-Host of Mail-Right's: Real Estate Agent Podcast

Great talking points! My meeting #1 is an orientation meeting where we set expectations in reality. I even address the "advice" they'll receive from well meaning civilians. I will say I've never had a buyer doubt the validity of a pre-approval, they are quite official in CA.

Jan 11, 2017 06:40 AM #12
Rainer
66,859
Patrick Willard
Rio Rancho, NM

But their uncle was a part time real estate agent for a year back in 1983 so he knows what he's talking about. LOL

Jan 11, 2017 08:12 AM #13
Rainer
170,177
Myron Lund
Real Estate Directory - Rochester, MN
Serving the Rochester area for 25 years

Good reminder.  This may seem basic information, but good stuff to run by clients who don't do this every day like we do.

Jan 11, 2017 10:10 AM #14
Rainmaker
348,858
Mary Hutchison, SRES, ABR
Better Homes and Gardens Real Estate-Kansas City Homes - Kansas City, MO
Specializing in Brookside, Waldo, Prairie Village

Very informativ e!  I feel it's especially important with first time buyers to go over the inspection process up front. I have given buyers copies of other inspections so they can review.

Jan 11, 2017 11:21 AM #15
Rainer
5,320
Chris Ward
Mortgage Master - Park Ridge, IL
Loan officer licensed in IL, WI, CA, FL, VA, NC

Nice job on this post.   It is all about educating the client.   As far as pre-approvals, rates are trending higher.  A pre-approval from 4 months ago is meaningless today.   Setting expecations up front is key.     

Jan 11, 2017 12:24 PM #16
Rainmaker
298,997
Donna & Larry Johnson
Keller Williams Real Estate - West Chester, PA
Chester & Delaware County

A buyer consultation is always the way to go! We can only hope they listen. 

Jan 11, 2017 03:23 PM #17
Rainmaker
741,029
Jan Green
RE/MAX Excalibur,Scottsdale, 602-620-2699 - Scottsdale, AZ
RE/MAX Excalibur, REALTOR®, EcoBroker, GREEN

Utility bills would also be included in true cost of ownership and most people forget about that!  It's good to ask for that stuff from the sellers before your clients think of it, they'll love that you thought of them this way.  

Jan 11, 2017 08:06 PM #18
Rainmaker
12,826
Carla Black
Stanberry & Associates - Dripping Springs, TX
REALTOR, GRI

Free advice is worth every penny. 

Jan 12, 2017 09:18 AM #19
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
182,284

Nadine Larder

Real Estate Marketing Expert/PrinterBees Founder
How Can I Help You With Your Marketing?
*
*
*
*
Spam prevention

Additional Information