Hey, has any one heard about the subprime lending crisis? OK, I guess you probably have. From what I understand, this crisis, we are going through right now, is due to all the lowlife, lying and cheating Mortgage Brokers that had saturated our business over the last few years looking to pad their wallets with the blood sweat and tears of the working class. They have been working in conjunction with money grubbing REALTORS® who have driven property values to all time highs by coercing the consumer into purchasing above their means. And "The Man" has sat idly by sucking the average Joe dry in increased property taxes while raising insurance rates to subsidizing the super wealthy who want to live on the San Andreas fault and opening the flood gates of evil money to anyone that could breath and sign on the dotted line.
OK, OK!!!!! I'M JUST KIDDING! Maybe?
Anyway, this post is not about who's responsible and how it all happened, this post is about what we can do to keep our heads above water while the storm passes.
First, let's start with the easy one, Buyers: If you want a piece of the American dream, here are a few steps you can take, to help you achieve your goal.
- Save your money. If you are currently renting for $1,000 a month, but want to purchase in the future, then find out how much home ownership will cost you per month, subtract $1,000 and start saving the difference. This will do two things for you. First, it will discipline you to be able to pay the higher price of home ownership. Secondly, it will provide you with a down payment when you are ready to purchase. If you can't afford to start saving the difference, then you are not ready to purchase a home. Simple.
- Work on your credit issues. If your FICO score is below 660, you have some work to do. Find a qualified credit counselor, make a plan and stick to it. If you are not able to do this, then you are not ready to purchase a home.
- Owning a home is NOT an entitlement. It requires hard work and planning. BUT if you are able to put in the effort, you CAN be a homeowner within 24 months. If not, well, I have rental for you. You can pay my mortgage.
OK Sellers, your turn:
- If you don't need to sell, then take your property off the market. You will not get "lucky" in this market and you may very well have to "give your house away". If you can wait, wait. Enjoy your home. Do some gardening and some painting. Make it look fresh and enjoy it. Hey, at least you have a home. Go dish out some food at the homeless shelter and thank God, everyday, for your blessings.
- If you need to sale, find a qualified REALTOR® and take their advice. In this market it's all about the price. Look at the bright side, if you have to under sale your house, you should be able to make it up on the buying side. Don't let this market scare you, just be smart. Houses are STILL selling.
Now let's see...........who did I leave out? Oh I know...REALTORS®!!!
- Learn your market. You must become an expert at pricing. In this more difficult market, there is no room for "Zestimates". Just thought I would throw that in there. But seriously, pricing is the key in this market. Get it right and your Sellers will love you. Get it wrong and....well, I'll come behind you and get it right.
- Increase your listing inventory. Now is an excellent time to increase inventory. The more inventory you have, the better chance you have, of getting some homes sold. It's also beneficial for your Sellers. Listings attract Buyers. Just make sure your inventory is priced properly and the Sellers need to sell.
- Increase your advertising budget. For some reason, REALTORS® make the big mistake, of decreasing marketing dollars, when times are slow. Don't do it!!! Now's the time to spend some serious bucks to generate those listings and Buyers you need. "But Broker Bryant I'm not making any money" Well, what did you do with all the money you made in 2004 And 2005? Spent it? Rookie!!
- If you have Buyers that have been pushed out of the market, don't abandon them, help them with the Buyer steps I outlined above. Get them on a plan and call them every now and then to make sure they are on track. Help them when they are ready in a couple of years. Why not? Are you going somewhere? Real Estate is about building long term relationships. If you haven't been doing that, now is a great time to start.
And...Subprime Mortgage Brokers...May I please have...two all beef patties, special sauce, lettuce, cheese, pickles, onions on sesame seed bun.
OK, this post is getting too long, so, I'm going to stop here. Folks, maybe the things I just mentioned are harsh but so what? Real Estate and home ownership is not a child's game. It needs to be taken seriously. So roll up your sleeves put on your work boots and let's go help some folks get through this difficult market. I know I will. How about you?