I loved this post by George Paukert, National Real Estate Coach. It is a great way to explain what has happened over the last 5 years.
In 2004:
Your ad would read ...
I have a house for sale. $300,000 NOW!
Call Immediately. Phone #
(In 2004 that house would have been gone within a couple of days. Most likely buyers would even pay $10,000 - $25,000 MORE just to get it.)
In 2005:
Your ad would read ...
House for sale. Cash only.
Flip the contract. No need to close.
Call Immediately. Phone #
(And the house would find several buyers, each one increasing the value by a minimum of $25,000.)
In 2006:
Your ad would read ...
3 bedroom home, new, 1800 sq.ft.,
2 car garage. At $289,995 it’s a deal!
Must close first. Investors 20% down.
Call for Details. Phone #
(Remember, we are talking about the SAME imaginary house. The difference is how the ads change when demand goes down.)
In 2007:
Your ad would read ...
Beautiful home for sale in superior neighborhood.
3 bedrooms 2 ½ baths, 2 car garage, 1800 sq.ft.
Vacant, ready to move in. $249,995 - negotiable.
Builder offers huge incentives and bonuses worth
$50,000. Call - Phone #
(As you can see, 2007 has come full circle since 2004. The same house that sold at $300,000 and $400,000 for flippers came down to $249,995. You cannot ignore the changes - the timing and the real estate conditions.)
In 2008:
Your ad would read ...
No Bank Qualifying!
No Credit Needed!
No Job or Income Verification!
Low Down Payment!
3 bedrooms, 2 ½ baths, 2 car garage.
New, vacant, ready to move in.
OWNER WILL CARRY!
Price: $279,995, monthly payment
$1600 at 6% interest amortized over
30 years. Call TODAY - Phone #
(Creative financing is coming back into vogue! With increased qualifying and down payment requirements by lenders, fewer buyes can qualify for new loans.)
In 2009:
Your ad would read ...
Short Sale - Seller Desperate!
Beautiful home for sale in superior neighborhood.
3 bedrooms, 2 ½ baths, 2 car garage. Formal living
room, dining room, and family room. Seller paid
$300,000 in 2004 - bank willing to accept a short
sale of $235,000. Home in pristine condition -
ready for you to move in tomorrow.
Call - Phone #
As times change, Realtors must react to those changes. These are just examples show you that in the past few years how the ads for one house could affect your business. And you can expect more changes in 2009 and 2010 on the same imaginary house.
The Realtors' business is always "moving." What was true a year ago is no longer true this year. You cannot "fall asleep" behind the wheel. If you do, your competition will pass you by.
Pay attention to the changes around you! And then take advantage of those changes. Of course, I cannot talk about all the changes across the country. PAY ATTENTION to what's happening in YOUR area!
George Paukert, "Mr. Real Estate"
Road to Wealth Inc.
Phone: 561-883-2222
E-Mail: george@roadtowealth.com
Imaginary Agent X faxes over offer for $165,000. with a note that says. Get the bank to take this offer will ya. LOL
Very creative!