RISMEDIA, October 17, 2009—As a new and different economic environment continues to evolve around us, a unique opportunity exists for real estate agents to take a position of authority and provide guidance which will earn them respect, a strong reputation and long-term career success. Here, Glenn Melton, CEO of Realty Executives Int’l., Inc. discusses what you must be doing to position yourself now and for the future.
Trying to wrap your arms around the myriad of market conditions, government policies and economic trends is a tall order, but well worth the investment. A unique opportunity exists right now for real estate agents to take a position of authority and provide guidance to customers that will earn them respect, a strong reputation and long-term career success. So the question is: What are you doing to position yourself now and for the future?
Stay current, yet know your history. Consumer confidence hinges largely on information dispersed in the news. However, the media, by-and-large, communicates the story of the moment, focusing on micro trends. The biggest increase in sales in the past nine years, the Case-Shiller index increasing after nearly three years of steady decline, home prices finally going up in major cities like Boston, San Francisco and D.C.—what does this mean for the client? It appears that the market is trending toward stabilization, but making informed decisions on future investments requires an understanding of the events that led to the collapse of the housing and credit markets, as well as capitalizing on the resulting dislocations and opportunities for government-subsidized aid.
Know government programs and policies. Today, the government has taken the role of lender of last resort to stem an economic collapse. The Housing and Economic Recovery Act of 2008 has generated a significant increase in first-time home buyers due to its tax credit provision. The success of the newly enacted stimulus package and its focus on job retention is the key to curtailing rising foreclosure rates and stabilizing prices. The Administration has also supported bank stabilization with TARP by injecting capital into banks to free up lending. The Federal Reserve has so far been successful in keeping mortgage rates low so buyers can better absorb the inventory, as well as helping to mitigate the consequences of adjustable rate mortgages for those unable to refinance. All of this and more is going on during the challenging and painful events described in the headlines.
Familiarity with current laws, regulations and available programs is vital to effectively make prudent recommendations. With more understanding, a real estate advisor is better equipped to educate their client and offer superior guidance.
Know your customer. The economy is improving and the pace of decline in the residential real estate market has slowed. We are seeing the average days on the market coming down and the inventory absorption increasing, which are signs that cautious buyers are tiptoeing back into the market from the sidelines. So is now the time to buy and sell? The answer is, of course, it depends. This is a great time for consumers to leverage the pricing and opportunities available in this market, particularly for first-time home buyers, move-up buyers, investors, and second and vacation home buyers. However, understanding the economic realities allows agents to identify who should buy and who should not, who should modify their loan, rent, short sale, sit or hold and so on.
In this dynamic and uncertain environment, it is vital for buyers and sellers to receive insightful counsel to achieve their goals and objectives based on their individual circumstances. This cycle presents a unique window for agents and brokers to be that resource to clients and to define their leadership in what will be the new and different economic environment we are seeing evolve around us.
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