Dress for where you’re going, not where you are

I have a broker’s open coming up and it’s got me thinking about a lesson I’ve learned in this business. When it comes to anything I do professionally, anything at all, I dress for success and show up with my game face on. 

I think of it like this – in corporate jobs, you’re expected to show up and look the part. So why should real estate be any different? Whether I’m going to a broker’s open, a listing appointment, a negotiation meeting, or even just taking an important phone call, I look the part! When I look my best, I do my best. 

- James

The tides are turning for townhomes

Townhomes are gaining popularity among both buyers and builders. For buyers, townhomes offer more space than traditional apartments and typically sell for less than condos. For builders, they’re cheaper to construct, take up less land, and sell quickly. According to the National Association of Realtors:

• Nearly 13% of single-family homes built last year were townhomes
• Townhome construction is up 38% YoY
• In the next few years, townhome construction is expected to make up over 15% of all single-family home construction. That’s the highest share since 2008.

Our take

Townhomes are a great solution for your clients who don’t want a ton of housework or maintenance. They don’t have to worry about a yard or pool, so they’re really the perfect solution for clients who want a lock-up-and-go kind of home. Developers also love townhomes because they can build a lot of them at once and do it for a lower cost than individual homes. In a housing market with low supply, townhomes are an attractive option.

Zillow reports inventory is nearing rock bottom

Just in time for peak buying season, home inventory levels have hit a new low. Zillow’s February housing report shows only 729,000 listings on the market, making February the fifth consecutive month of falling inventory. Listings are now down 25% YoY and a full 48% since 2020.

Why does the situation keep getting worse? Chalk that up to delays in the global supply chain, creating shortages on important homebuilding materials. Spiking mortgage rates are also part of the problem (...more on that below). They’re creating a sense of “buyer urgency”. Home shoppers are rushing to buy before rates climb even higher. That’s taking even more inventory off the market.

Our take

Take this as more motivation to get out there and get listings! Rates are going up fast, and it’s only going to get harder to get into a house. Homes may be expensive right now, but it’s only going to get worse. Tell your buyers, the time is now! 

Mortgage rates climbed last week

The Russia-Ukraine volatility caused mortgage rates to drop early in March, but now rates are again on the rise. The average 30-year mortgage rate is around 4.28%. That’s the highest level we’ve seen in almost two years. Just one week prior, rates were at 3.90%.

That jump didn’t seem to deter motivated buyers. New mortgage applications rose 8.5% last week, showing that spring’s busy buying season has already arrived.

Our take 

Rates are beginning to rise, but demand is unbelievably strong right now. It’s so strong that mortgage rate increases aren’t deterring a large number of buyers. Keep reminding your clients that although rates are increasing, they’re still better than they were fifteen years ago. So do your absolute best to help them find something before the next federal interest rate hike becomes official!

Schematics 

The news that just missed the cut

• What $1M gets you across America
• Impact of Russia-Ukraine conflict on the US housing market
• John Travolta’s mansion also doubles as an airport
• Redfin CEO Glenn Kelman on why this market is creating renters
• The craziest thing agents have done to get a listing

Foundation Plans

Advice from James and David to win the day

Recently on the podcast “Thirty Minute Mentors”, host Adam Mendler and I (James) talked about how to bring your absolute best to the negotiating table. Here are my top tips for negotiating deals like a pro:

• Be aggressive. You should be firm in your negotiations, advocating for your client at every step. But do it with class. A quick paycheck isn’t worth burning a bridge. 
• Understand who you’re dealing with. You should learn as much as you can about the agent you’re negotiating with before you sit down at the table. You’ll be able to speak their language and ultimately get a better deal for your client.
• Develop a strategy. Go into your negotiation with a plan and a number in mind. Be prepared to do the dance, but know what your client’s non-negotiables are.
• Take your time. Listen to the other agent. Make them feel heard and understood. If you rush straight into playing hardball and skip the relationship-building first, it’s much harder to have a collaborative conversation. 

Catch the full discussion here.

Just in Case

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

It may feel like a lot is up in the air right now. Mortgage rates are all over the place, prices are still rising, and there’s just no inventory available. We understand. But let us assure you, no matter what the market does, the basics always work. Stick to them. Networking, door-knocking, and offering exceptional service never go out of style, no matter what the market does. So get out there and make it a great week! 

- James and David

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