All the forces are aligning to create an incredible Real Estate Market for 2009 and beyond.
According to today's Atlanta Journal Constitution the Federal Reserve will begin purchasing up to $500 Billion in Mortgage Backed Securities starting next month in an effort to bolster the long suffering housing market.
Why is this important?
1. Because the Federal Reserve is purchasing these Securities, it is outside the Political arena and can stimulate rates lower. That means we don't have to rely on politicians to take action or inaction, whichever you believe they do. Lower rates will stimulate demand for housing, especially re-sales since many builders are out of business.
2. In December the Treasury Department announced action similar to this which dropped the 30 year fixed rate to 5.00% and for a few hours to 4.50%. I expect to see rates drop to this level again in January. I can't time the exact moment, but all indicators are pointing in this direction. Your Clients are going to get a once in a lifetime opportunity to lock in rates that they'll never have to refinance.
3. For those with clients that have closed in the last 5 years, it's an opportunity to add value to their lives. Keeping them informed of the current rate environment gives you a great reason to call and discuss their situation. For some it may mean refinancing to a better rate/term. For others, they may be looking to sell in a couple of years, so they have something to look forward to when the market heats up in 2010 and 2011.
4. For those with an FHA loan greater than 6% that have paid their loans on time for the past 12 months, now is the time to check on a Streamlined FHA refinance.
What should you do?
1. Contact all your past clients and review their loan situation. Add value to their lives while promoting yourself as looking out for their financial interests, since You Are! Let them know about not only the refinance opportunity, but if you have buyers, NOW is the time to lock in their new home with a great rate.Get to know their situations and in some cases you will find out that they are looking to move up to a bigger home. That's a listing and a sale.
2. Ask for referrals of other friends, neighbors, relatives and co-workers. A listing this spring with an open house can give you tremendous exposure. Many people have gotten out of the business and they want to work with someone they trust. Build your pipeline of buyers, not just First Time Home Buyers. While there are many incentives for First Time Home Buyers, the Move Up Buyers will generate larger home purchases.
3. Make sure your Flyer Boxes are kept full. I don't know how many listings I drive by that the boxes or tubes are empty. How else can you get your name and face in front of potential clients without spending an arm and a leg? Now is the time to get maximum exposure/contacts generated for big dividends this year.
As always, if you have a question or thoughts on how to generate more business, feel free to give me a call.
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