Why the “silver tsunami” ain’t happening

Fear not, friends

Our whole world is becoming electronic, and there is certainly nothing wrong with that. In fact, it’s how we are “talking” to you right now.

But as you know, this past year, we’ve all heard about the rise of artificial intelligence and how it will take all our jobs, write our movie scripts and TV shows, and conquer our entire world. To that we say, not so fast!

We have a stat for you in today’s second story that will hopefully put to rest any concerns about the business of being a real estate agent.

On that note, in today’s Foundation Plans, we discuss three things that us humans can do to make sure we outpace all the robots apparently coming for our jobs. We know it’s basic advice, but sometimes, it’s those fundamentals that matter most.

And with that, let’s get into today’s Blueprint… written entirely by humans.

- James and David

Experts change forecasts for home prices

7 of the leading home price forecasters have upwardly revised their predictions for this year. On average, they now expect home prices to rise by 3.27%. Here’s each firm’s prediction for home price growth this year:

• Goldman Sachs: +5.0%

• Mortgage Bankers Association: +4.1%

• Zillow: +3.5%

• Fannie Mae: +3.2%

• Freddie Mac: +2.8%

• Home Price Expectations Survey: +2.4%

• National Association of Realtors: +1.9%

Our take

This is an especially important report, and definitely one you should share with your clients. If they want to buy, they should do it now before homes become even more expensive. But we know there’s more to this story. Mortgage rates may be in the 7s now, but we have every reason to believe that they’ll drop this year and fall even further in 2025. And when you consider all the options homebuilders are offering–concessions, rate buydowns, below market rates–we believe buying now and refinancing later makes a ton of sense.

New construction buyers need agents

94% of new construction buyers say that they will seek out a real estate agent because they need help getting the best price and navigating the buying process. That’s according to Realtor.com’s 2024 New Construction Consumer Research Report. Here’s what else to know.

• Since 2022, the share of new home sales have exceeded 30% of the overall market. Typically, they make up about 10%-15%.

• Millennials are most likely to buy a new home, a shift from a few years ago when baby boomers were the likeliest new home buyers

• 28% of millennials reached out to an agent as soon as they started thinking about buying a home

• 30% of new home buyers had an annual income of $100,000 or more, compared to 22% of buyers who purchased an existing home

Our take

Let’s take a moment to re-read that opening stat. 94% of new construction buyers are likely to seek out an agent to represent them! Take that, robots! For all the chatter about how artificial intelligence and tech will replace us human agents, this report shows that buyers – even highly-tech savvy millennials – still want a real-life human being to guide them in the home buying process. This is such terrific motivation for all of us, and shows why our jobs aren’t going anywhere… at least for now.

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Don’t expect a “silver tsunami” to hit in 2024

You may have heard warnings of a “silver tsunami.” This is the term used to describe what will happen when more and more people turn 65, specifically baby boomers, expanding the amount of “older” people in the population.

In real estate terms, some are predicting that these boomers will age out of home ownership, sell their homes, and flood the market with inventory. But according to an analysis published by Freddie Mac, the “tsunami” is more like a slow tide, with a gradual exit of older people mostly offset by new entrants to the market.

Economists at Freddie Mac estimate that the number of baby boomer homeowner households will decline from 32 million in 2022 to 23 million by 2035.

Our take

This report is important because it corrects all that “silver tsunami” talk. We totally agree with everything it says. Baby boomers are in the process of exiting the housing market, and this process will gradually increase over time, but we just don’t see this trend having that much of an impact on transactional volume in 2024.

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Schematics

The news that just missed the cut

• Home prices have doubled in this Florida neighborhood

• While China’s real estate is in trouble, UK real estate is booming

• Use these AI apps to boost your real estate sales

• IG accounts you should be following to learn how to market

• Nvidia’s Jensen Huang’s real estate portfolio

Foundation Plans

Advice from James and David to win the day

New agents often ask us a variation of this question, “What is the one thing that I need to do to be successful as an agent?” We always say there is no one thing. However, there are a few things that you should focus on.

Communication – This is the number one skill every agent needs to develop. Good communication separates not just good agents from bad ones, it separates good agents from great ones! No two clients are exactly alike. You have to adapt and personalize. Make sure you listen just as well as you speak. Ask questions and paraphrase their response to ensure they know you’re listening. 

Networking –  This is the main way to build your career. Attend conferences, networking events, and even social events that might not seem directly related to lead generation. Make it a priority to establish and maintain good relationships with stagers, home inspectors, handymen, real estate lawyers, mortgage lenders, etc. You never know where these conversations will lead.

Time management – It's too easy to get bogged down in admin tasks that prevent you from doing client outreach and networking! Focus on income-producing tasks and delegate other work to an office manager or virtual assistant. Also, create schedules for each day, week, and month. You should not wake up and wonder what you will be doing that day. The more you take control of your life, the more you’ll take control of your career.

As you can tell, we have a lot more we want to say on this subject. Rest assured, we’ll be sharing more. But, to get your bearings, start here and here.

To learn more about Estate Media, visit their website.

Just in Case

Keep the latest industry data in your back pocket with today’s mortgage rates:

“You’ve got to keep control of your time, and you can’t unless you say no. You can’t let people set your agenda in life.” — Warren Buffett

That’s a wrap on this edition of The Blueprint! We’ll see you on Friday!

- James and David