Seasonal slowing + COVID?
Psychology of buyers and sellers
The sneaky stove
Being active in the market
Map of the buyer journey
If you have questions/comments about anything here, or you know, or you are seeking real estate representation in the Charlottesville area, you can reach me here.
I had the note almost ready to go when a client sent me this. Thank you!
It seems like we're in another lull in terms of new listings coming on the market. I was curious: Is that normal for this time of year or do you think it might be because COVID has gotten worse locally?
This time of year is when inventory typically drops. I told my client that once we get to Halloween, then it's Thanksgiving, and then it's Christmas and winter break.. People get busy and with life. COVID has gotten worse also, but I think for the most part, we've gotten used to it and how to operate in a pandemic.
That said, the market has been flattening a bit over the past few years. There are still going to be homes coming on the market and there are still contracts that will be written. If you are a buyer in the market who is able to make an offer now on a house that you like, now might be a very good time to do so. Interest rates are still low and while I've been saying this for 11 years, they might go up next year. There is less buyer competition in the winter, and while there is less inventory, those sellers who are on the market want to sell and are not just testing the market.
I intended this to be a quick response, but then I read a bit more.
Calculated Risk - A few comments on the Seasonal Pattern for House Prices
Altos Research - Inventory declines as we head into the 4th quarter
I haven’t updated the data in a few years.
So I asked one of my partners if he could put something together, and he sent me this.
Psychology of buyers and sellers
Unpredictable is the word. Emotions are the enemy.
I was telling clients a long time ago that in real estate I have been a marriage counselor, therapist, babysitter, divorce counselor, mover… I remember their eyes getting a little bit big and asking how I’d managed to do all of that. I told them that that had been the previous week.
“Human Psychology” is nowhere in the Principles of Real Estate, but psychology is one of the most important components of what we do (insert picture of orange mug). Ultimately, we are dealing with humans.
For a lot of my clients, the home sale process is traumatic; most moves/sales/purchases are a result of a life change, some expected and planned for and many unexpected and surprising.
I remember the time my client called me the day she found out she was pregnant: “I’m pregnant, this house is too small, and I know we’d planned to be here for a long time, but we need to move!”
There should be a class for this.
Through crisis and happiness, the good agent’s role is to be the unemotional guide who's not caught up in the emotion and excitement. The agent's role is to be the professional offering advice and asking questions that the client may not know to ask, such as what's happening with the Future Land Use Map rewrite in the City of Charlottesville? Or asking the questions the client may not want to ask, like your parents are getting older, what are the chances one of them may move in with you?
That’s it.
Sneaky Stove
“...together with all fixtures located thereon (if present as of the date of this Contract), including, without limitation, blinds, ceiling fans … mailbox and post, built-in range, shades, shrubs, exterior plants …”
Built. In.
Many years ago my buyer clients and I went to the final walkthrough to ensure the house was in move-in condition. We went through and noticed that the stove was gone. Hmm.
I called the other agent, who was as surprised as I was. He called his clients asking where the stove was. I’ll never forget when he called back and said, “I don’t know what to say. They said the stove was not screwed into the wall, so they took it.
And that was one of the first times I bought an appliance for my clients. I’d like to think that the agent split it with me, because that was the type of person and agent that he was. He died early this year, far too young, but I’m choosing to remember that he and I split the stove for my clients.
Being Active
I showed a bunch of houses this year to one set of buyers. They didn’t buy anything and probably won’t, despite the countless hours spent looking. But I was able to tell another set of buyer clients about those houses.
A potential client called me to evaluate a property they were renting, as they were thinking about buying it. My value came in at a reasonable number; the property came on the market and is still on the market.
That allowed me to tell another client who asked about it that it was a weird house and that I hoped he enjoyed the open house.
Being active matters. Inertia matters.
Productivity is not necessarily an indicator of competence, but it is certainly an indicator. I feel that if an agent is not doing at least five sides (transactions) per year, he or she is not experiencing the market sufficiently to represent clients. This market changes too fast; there are too many things to learn on an almost daily basis.
Learning every few weeks or months is not enough.
It’s fun to be active and rewarding to be competent. (2012 thoughts, too).
Being active brings relevance, too.
The Buyer Journey
Representing Sellers is pretty systematizable. (start here if you’re thinking about selling). A few of the points in the “it’s usually like this” timeline:
Prep the house.
Price it right.
Market it well.
Negotiate.
Negotiate again. (home inspection)
Close.
Buyers, not so much. I have about 50 questions on my buyer survey, and that’s just the start.
Yes, I have a rough timeline once we get under contract. The “identifying the right location/lifestyle/sacrifice/plan for the future” house can be like the Family Circus kids’ routes. I’m finding the “location” part a bit more challenging now as more people are working at home and “office” is not necessarily a locational data point that matters.
(this was a great comic)
My wife and I were talking recently about a buyer map showing their journey about how buyers got to where they ended. Part of me thinks it would be a cool thing to do; the other part knows that humans will focus only on the one(s) they lost. I’d love to think that we would all focus on getting the “right one.”
Pandemic Introspection.
What matters. Reflective introspection. Those who are close to you (like my wife) matter more than ever. Life is a series of events, that while they happen to all, are new and unique to each of us. We just married off one kid (more next month), one is about to finish high school, parents are aging, and we’re trying to enjoy every day. When you read this, hopefully I’m off sneaking a midday hike with my wife, because we can and because we want to.
—
What I’m Reading
So, What do you do? I’ve never seen “why I ride” better described.
You don’t have to fix it all now. Just start by fixing something.
You need to read, and listen to the Wall Street Journal’s Facebook reporting. Facebook is evil.
The Global Housing Market Is Broken, and It’s Dividing Entire Countries
Redfin report: Americans are moving to places with higher climate risk. Wait til they can’t get homeowners insurance.
Thank you for reading, and I hope your days are good.
— Jim
