I am pleasantly surprised by the response to my post discussing how I can help or, what does a Realtor look for in a LO. The overwhelming theme was RESPONSIVENESS and COMMUNICATION. These two aspects seem to be, all to often, lacking in the Realtor/Lender relationship. I have read all of your comments and will take each and every one of them to heart.
I would like to take the discussion in a slightly different direction here. I want to talk more specifically about techniques, promotions, campaigns, etc. that will be helpful in creating more interest in your listings. What are some ways to help create a sense of urgency...nudge that fence-sitter and ultimately MOVE SOME INVENTORY!
First up for discussion is the 2/1 Buydown. This is hardly a new concept to you guys and it is no magic bullet but, can it be effective in reaching the previously mentioned objectives (interest, urgency, differentiation from a similar listing across the street)? Have any of you utilized this program and if so, how was it used and more importantly, was it effective in generating inquiries? I have mentioned this technique to several Realtors locally and the initial reaction was one of interest. Most have heard of it but have not used it. I claim no ownership of this strategy or supporting materials as this information is available through a popular Mortgage professional resource website.
In a nutshell it goes a little something like this.
You have had a listing for a while and have not had much traffic. You suggest lowering the price and the HO agrees. What if...instead of lowering the price, the HO offers to pay the fees associated with a 2/1 Buydown. The interest rate is dropped by 2 points the first year and by 1 point the second year and reverts back to the original fixed rate for the remainder of the term. The savings are truly substantial! Very Cool... but it needs to be marketed properly. Either a sign rider or a designated sign in the yard reads...in bold red letters "THIS HOUSE ONLY, SPECIAL FINANCING, SAVE $433.78/MONTH". There is a box of flyers that are all jazzed up with pertinent info (I'm really good at these). The flyer is a colorful, photo laden, MLS type with the program explained in easy to understand terms and a call to action by way of "MUST CLOSE BY DEC. 15th".There is a lot more to the flyer...graphs, savings comparisons, etc. Again, this is no magic bullet, however, it certainly creates interest and interest creates leads and leads, well... you get the picture.
This program has several benefits. The fee associated with the Buydown almost always is less than the amount you would have reduced the price. It keeps the price where it is (no commission reduction due to price reduction) and keeps the values up in the neighborhood from a comp standpoint. Buyers will love the idea of reduced payments over the first two years and they will start coming up with ideas on how to use the money to...furnish, landscape, decorate, pay down debt, etc.
This is an awesome way to create more interest in a property. What say you?
PS - 3/2/1 and permanent buydows also available.
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