The average purchase price was $224,000 for a repeat buyer as compared to $156,000 for first-time buyers. Based on the sales price averages, real estate commission income would be over 30% more when you work with repeat buyers (not to mention the listing side of the deal.)
First time buyers are twice as likely (17%) to move within the first five years versus repeat buyers at 9%. Keeping in touch on a consistent basis is not enough. The information you add about each client to your database must be detailed and the information you provide must be relevant. One size does not fit all if you want the chance to work with them in the future.
Don't ignore the For Sale by Owner sellers. Chances are they'll buy another home and it's your opportunity to be the one to sell it to them!
While first-time homebuyers did make a significant portion of the market in 2009, repeat buyers had a 53% market share, a National Association of Realtors survey found, although down 7% from 2008.
The survey also says that 66% of buyers and sellers were satisfied with their real estate agent, yet only 17% used the same agent the next time they bought real estate? Why is that? Did that person leave the business? Are you following up with your real estate agent referral sources on a regular basis?
If an agent is leaving the business, offer to take care of their "orphaned clients." Stay in touch with e-mails, newsletters, post cards and letters from the heart.
Don't spend your money on homes magazines or newspaper ads. The survey says they are only read by 27% of the home buying public.
In 2009, the survey reported a 13% "fall thru rate" of deals that did not close. Of that, just under half of those were because of loan rejections.
A white paper for your real estate agents can be found at www.LoanOfficerMagazine.com. We have interpreted what the numbers could mean to you in creating a marketing plan - and getting your foot in the door.
Things have changed dramatically since your customers bought their last home. Seminars are a great way to update them on the underwriting rules, the Home Valuation Code of Conduct and the most current Multiple Listing Service stats. The content needs to be completely different for each seminar - credit scoring, how to best leverage the cash from the sale of their home, buying a foreclosure.
Here's a surprise that could lead to potential business. Approximately 31% of repeat buyers, after they sold their most recent owned property, rented or lived with parents/friends for a while, and are now back in the market. Reasons for this phenomenon could be due to financial problems, relocation, divorce. Consider marketing to apartment complexes.
Single females made up 17% of repeat buyers, or double that of single males (8%). Consider holding a "Women-Only Home Buying Seminar" (creating a niche within a niche) and become the "expert" in helping women buy their next home.
The median age is 39 years old (down from 46 years old in 2008). Think social media, blogs, video and audio when looking for ways to communicate.
The financial rules are more complex these days. When planning your Internet strategies, think about the team approach. Include an accountant, financial planner, an attorney and an insurance agent to counsel them on the best allocation of funds when they sell their home.
It goes with out saying that the values of homes have decreased and last year, 60% used the money from the sale of their home toward their down payment. More are digging into their savings for additional down payments. It needs repeating - include a CPA, financial planner, and an attorney and insurance agent to counsel them on the best allocation of funds when they sell their home.
Remember, they need financing, as 87% of repeat buyers relied on a mortgage. Just about one-third said that the mortgage application and approval process was more difficult than they thought. Surprisingly 6% reported being rejected for a loan. Knowing the rules and regulations will increase your chances of helping your clients get thru the mortgage maze and the minute-by-minute changes.
Information for this article was obtained from the NAR "Profile of Home Buyers and Home Sellers 2009." You can purchase the entire survey online at www.Realtor.org.
