How To Get Home Buyers To Sign In Times Of Economic Distress?

Posted by Beni Restea on September 15th, 2023

We’re living in literally anxiety-inducing economic times. Our livelihood is endangered due to inflation and the possibility of a future recession. With rising prices, we must cut back on our everyday expenses. Plus, investments are slowed by increasing interest rates. 

The overall economic distress impacted the US housing market. Home sales dropped substantially. No wonder many home sellers need help getting buyers to sign the contract in such times of economic downfall. But fear not! Let’s examine some creative ways to solve this setback!

Expert local realtors bring you the solution.

Many need the indispensable background knowledge to embark on the home-selling journey. To dodge as many issues as possible you may encounter right from the get-go, we advise you to get in touch with established and experienced local real estate agents! 

Agents and brokers know how to adapt to even the harshest market conditions. As a result, they can bring any property seller one step closer to closing. Moreover, they will confirm that properties are one of the safest investments in times of inflation.

Which were the events leading to decreasing home sales?

Before falling into the despair of being unable to sell your real estate, you must know the entire global economy is going through dire straits. We won’t enlist the complex cause-and-effect chain reaction that almost pushed us to the brink of another recession. Suffice it to say that we still haven’t fully recovered from the economic shock treatment the COVID-19 pandemic bestowed upon us. 

Due to the worldwide lockdown and financial uncertainty, the economy fell behind. In the heat of the moment, the central government brought certain decisions (for instance, lowering the interest rate and raising the money supply) to patch up the momentary problems. However, in the long run, they created a whirlwind of issues. Then, the Russian-Ukrainian War stirred up the waters, making (oil, energy, and building material) prices soar further away from “reality. “

It’s all about the interest rates.

In a desperate attempt to normalize the situation and reduce inflation, the Fed pushed interest rate hikes, making borrowing money costlier. However, by doing so, they impeded the genuine solution that could lead us out of this financial conundrum. Investing in businesses, land, technology, and education can salvage a national economy. 

However, with the Fed raising the interest rates in 2022 and the first two quarters of 2023, investments for many became a vapid dream. Also, the high mortgage rates meant the final nail in the real estate market. 

Empathy for buyers and investors

As homeowners experience difficulties selling their property, they might believe the housing market has turned against them. Nonetheless, it was caused by a vicious (and inevitable?) cycle of events. 

At the same time, real estate sellers must understand that buyers and investors go through the same impasse as they do. Property prices are high, and mortgage rates have skyrocketed (with no certainty when they will stop.) In addition, homeownership became an expensive journey to undertake. Under such circumstances, house hunters will consider twice what property to invest in 2023.

Emphasizing a property’s enduring long-term value

Knowing the “handicap” sellers start this adventure should be the starting point for them and their real estate agents! They must turn a property for sale into the most enticing investment opportunity. How can they achieve this? 

Getting ready to sell a property!

A thorough market background check is vital before listing a home. Is the local market competitive? Are there more buyers than homes for sale? In a seller’s market (where the demand exceeds the supply), sellers might obtain a higher price. On the other hand, the buyer’s market indicates that homes for sale surpass the number of potential buyers. In such cases, sellers might not get the initial price. 

Furthermore, real estate comps and comparative market analysis will give sellers a rough idea about the immediate market and how prices have changed. Based on this information, sellers can make an informed decision about the correct pricing and timing of the home sale. If you ask yourself how you can get in possession of such information, reach out to professional agents in your area!

Improving a home’s appeal before listing

First impressions count! Before home appraisals, the property for sale must be in tip-top shape. No buyer will ever consider buying an eyesore. Depending on the budget, we recommend renovating your home’s exterior aspects/ For instance, a new roof, revamping the garage door, fiber-cement sliding, and a fiberglass front door will boost your property’s worth. So will landscaping and a beautiful and well-tended garden. 

Don’t neglect to revamp your interior design, either! Few sellers know that buyers will look at the kitchen first. So, an updated kitchen is a must-have! A repainted bathroom and living room are also essential to increase the chances of selling your home. However, the ultimate convincing factor can be upgrading your home with intelligent and eco-friendly gadgets to reduce monthly expenses.

Reveal the numerous advantages of homeownership!

You can start with the basics. Remind buyers that purchasing a home is a long-term investment and a hedge against inflation. Unlike other assets, such as cash or stocks, real estate maintains its value over time. Thus, it can be an attractive option during inflationary periods. 

Most buyers don’t know the perks of homeownership, so highlight them! They can benefit from home equity, potential tax benefits (not only for first-time homebuyers), and the ability to use the given property for future investments.

Enlisting local perks

Home buyers should comprehend that they can access countless perks by opting for a specific property. For this reason, sellers and their realtors must be able to present the thriving local economy, job market opportunities, and outdoor and indoor attractions worthy of exploring. In addition, discuss the immediate amenities, transportation means, and neighborhood safety. 

Is it a family-friendly neighborhood? How about the neighbors? Are there good schools in the area? Will new homeowners access affordable healthcare by moving into the new residence? Does the local government consider new buildings or extend, in any shape or form, the existing infrastructure?

If most answers are yes, the property might prove a gold mine for buyers and investors. It means that the asset’s market value will increase over time. Overall, the big picture will consistently improve the seller’s chances of closing the transaction.

Offer financial incentives!

In an inflationary market, discussing financing options and their implications is vital. After all, buyers will be interested in the price! Your realtor can explain how fixed-rate mortgages can provide financial stability in the face of rising inflation. Additionally, they can emphasize that locking in a low-interest rate can protect buyers from future increases. Thus, they can secure long-term savings. 

Owner financing can be another viable option for sellers and buyers. The parties can reduce the costs and the waiting period by leaving out the go-between, i.e., lending institutions. The advantages of owner-financing are that owners can sell a property as-is. Secondly, if the buyer defaults, they can retain the title. However, they also must be aware of its disadvantages, like the escalating repair expenses and buyer’s default.

Conclusion

Convincing buyers to sign during inflation requires a well-informed approach and careful consideration. We suggest taking concrete measures before listing a house or condo! Exterior and internal renovations and design updates will create an appealing impression. 

Once potential buyers start to show up, emphasize the economic advantages and long-term value of buying the property. Sellers should also stress that buyers secure their financial future through homeownership. And last but not least, provide financial incentives for purchasing your home, for instance, the option of owner-financing.