The Power is in 'The Terms'.

By
Real Estate Agent with Broker Associate PenFed Realty 0496522

In all the years I have been in real estate, the seasoned agents may smirk, I have been told the most important thing in home buying is location, location, location.  Almost nine years ago when I was sitting in my first real estate class the instructor said it over and over.  It is such a common saying you think of it first when someone asks, "What is most important?"  (Old car also comes to mind but that is for another post).

It has shifted.  Did you feel it?  When speaking with two buyers this week they asked me, "What are the interest rates?  What do you think I will qualify for?"  I cannot tell you how happy this made me.  I was a loan officer prior to being a real estate salesperson. This parallels my first set of questions to a prospective buyer.  The mindsets have adjusted, the questions are good ones.

The shift we have also seen over the previous year is people are being more realistic about their home ownership needs.  Cost of ownership is first, location is second, and amenities are now pulling in third.

In this economy many good people have suffered losing their home to foreclosure and seeing their retirement circle the drain.  I myself felt the shift of the stock market when I opened the mail and figured out exactly what I had left/lost.  JL Boney said it best when he said, "Just keep thinking long term."  Well, not all of us have that option if no longer in the workforce or planning the end of our career.  In my opinion real estate is still the best investment.

I cannot say I am happy about what has happened to the real estate market over the past 24 months.  However, it is refreshing to see how buyers are changing their priorities.  It was a shift I never expected to see in my lifetime.

BTW- Have you hugged your loan officer today?  (Insert expletive here).  Some may feel they helped get us into this 'adjustment' but I have a feeling they are going to be an asset again.

Comments (66)

Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

Mandi- We crazy Americans should have been doing that the whole time.  Freedom can lead to bad decisions.  I wouldn't trade it, however!

Nov 14, 2008 08:52 AM
JL Boney, III
Coldwell Banker - Columbia, SC
Columbia, SC Real Estate

I could have sworn that I saw it on the dashboard earlier, I'm sorry if it's not because it should be.

Nov 14, 2008 09:01 AM
Heather Goodwin
Licensed by the Louisiana Real Estate Commission - Shreveport, LA
Results That Move You

That's what I've been seeing to, Melody.  Affordability in whatever fashion they visualize that term, then location.  They are willing to give up the BEST location for a house that is more affordable.  Everybody's doing a reality check, I believe.

Nov 14, 2008 09:02 AM
Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

JL-  Better luck next time.

Nov 14, 2008 09:04 AM
Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

Heather- Many people have no choice than to do a reality check.  I have heard things are going well in Shreveport.  One of my favorite places to visit.  Just a hop, skip, and a little more than two hours from me.

Nov 14, 2008 09:07 AM
C Tann-Starr
Tann Starr & Associates, Inc. - Palm Bay, FL

Very well said, Melodious... ;-)

Nov 14, 2008 09:22 AM
Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

CTS- Thank you.

Nov 14, 2008 10:20 AM
Gary Woltal
Keller Williams Realty - Flower Mound, TX
Assoc. Broker Realtor SFR Dallas Ft. Worth

Mel, good point about taking a very close look at the cost of ownership. That can filter down in today's economy depending on the projected length of stay in a place, between a buy vs. rent decision.

Nov 14, 2008 10:52 AM
Jean Groesbeck
Compass - Anacortes, WA
Broker, CRS, e-PRO, ABR, ASP, CNE, IMS

The good loan officer are awesome!  Thank goodness the bad ones are going by the wayside!  Good ridden!

Nov 14, 2008 12:48 PM
Pam Pugmire
Silvercreek Realty Group - Meridian, ID
Meridian Idaho Real Estate

Great feature!

I have had the same experience with buyers lately.  All of them are buying well below what they qualify for.  And that's saying something since they qualify for less now than they did 2 years ago.  Maybe that's why they are the people that can still qualify for a loan!!!

Nov 14, 2008 01:33 PM
Kristin Moran
Owner - RE/MAX Access - KristinMoran@Remax.net - San Antonio, TX
San Antonio,TX - Real Estate - 210-313-7397

You are correct Mel now that I think about it.  Interest rates have been the topic of conversation w/buyers lately. 

Nov 15, 2008 12:36 AM
Cristal Drake
Prudential California Realty - Fullerton, CA
Realtor - Fullerton Real Estate

Hey Mel!  So you were a waitress AND a loan officer in your previous life like me?  :o) This post is so timely. In the fast and furious days of lending, no one thought about the real cost of their home or if they could afford it. It is so nice to see people getting back to basics.  I am finding here that it is cost, then the upgrades then location. It is so strange, with so many foreclosures, we are looking at terrible houses so a house that is upgraded is getting multiple offers!  It is sold right away.

I am with ya, Real Estate is still the best investment in my opinion too. If you are in it for the long term, it will pay off!

Nov 15, 2008 01:50 AM
Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

Gary- I think it is changing for the better.  My glass is half full.

Nov 15, 2008 02:05 AM
Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

Jean- They are certainly challenged these days.

Nov 15, 2008 02:05 AM
Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

Pam- Smart buyers are the best buyers!

Nov 15, 2008 02:06 AM
Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

KM- The issue used to be finding a way to manipulate the numbers to make the loan work for the home they wanted.  Now they are more realistic than ever before.  No more shooting first then asking questins later.

Nov 15, 2008 02:08 AM
Melody Botting
Broker Associate PenFed Realty - San Antonio, TX
You Deserve The Best

Cristal- I have been blond a few times in my life as well!  Just ask my hairdresser.

Nov 15, 2008 02:09 AM
Richard Weisser
Richard Weisser Realty - Newnan, GA
Richard Weisser Retired Real Estate Professional

Mel...

Oh wow, you got re-blogged! Cool.

Nov 15, 2008 02:25 AM
Laura Watts
Positive Properties, LLC - Laurinburg, NC

Mel-In my experience, I hear the question, "Will you help me get financed"?  I am not saying location doesn't fit in there, but most times, that comes in later. Once they know they can buy and what they qualify for, then comes location and looking for that perfect home. I guess we are all drilled with the "LOCATION, LOCATION, LOCATION" idea, but I also think we learn fast. LOL  Great Blog....

Nov 15, 2008 03:27 PM
Steve Loynd
Alpine Lakes Real Estate Inc., - Lincoln, NH
800-926-5653, White Mountains NH

Melody, I re-read this blog a month after you posted it. The stock Market hasn't improved, but mortgage rates have so the thought "real estate- makes a better investment" is holding true 30 days out. I agree it will be true for the foreseeable future as well.

Dec 13, 2008 12:18 AM