Home buyers often set themselves up for a stressful situation: Too loose of criteria equaling too many homes to see. With foreclosures, short sales and traditional sellers with houses on the market, there are hundreds of homes on the proverbial real estate shelves! As a REALTOR® in the Twin Cities north metro (Forest Lake, Ham Lake, Blaine and Lino Lakes areas), I have had a number of overwhelmed potential buyers approach me with some very loose home selection criteria. Our first conversation might sound a little like this: "Teri, I am willing to go anywhere for a single family home under $250,000. I just need a couple of bedrooms and a garage anywhere between Anoka and Lindstrom. Heck, I would even consider one of those townhomes, if the price was right."
The problem here is that with this type of open-mindedness, homebuyers could have literally dozens of homes available to choose from. While this might sound like a good thing, when faced with a plethora of choices, the amount of homes will be overwhelming to the buyer going it alone.
According to the U.S. Department of Housing and Urban Development website, the average buyer sees 15 homes before writing an offer on a home. In my experience this is a fairly accurate estimate. Most buyers begin to tire of the whole process after seeing a dozen homes. All of the homes start to look alike and become a jumble in their mind.
As we start to enter a more balanced market, how do you narrow down the list and focus on the best homes for YOU?
- Write down what you must have in a home. Need a 3 car garage? Want
a gas fireplace and hardwood floors? Can't live without a full finished basement? Would die without central air conditioning? Write down those must haves and weed out the homes that don't fit. - Select a neighborhood, area or school district. If you must be within 10 miles of work or your kids want to be in the same school district, use this parameter to define your search area.
- Work with a knowledgeable agent. By working with an experienced agent, my clients are able to get that list of homes down to a manageable level in short order. Although many internet searches have become very detailed, they are still not as detailed as the ones used by licensed agents. The closest public internet home search that will allow you to search like a REALTOR® is Listingbook. But in order to use the Twin Cities version of Listingbook, you must sign up through a licensed agent. This search allows you to set up your very own detailed searches that meet specific wants and needs.
It doesn't cost buyers anything to work with an agent. Our fees are traditionally paid for by the seller. But a REALTOR®'s service can be invaluable by saving the homebuyer time and frustration.
As a case in point, I had a client that was looking for homes in vast area of Anoka County. She originally told me that she wanted to be in Elk River but Wyoming and Stacy in Chisago County would also be considered. She was willing to spend up to $250,000 and do some work on the home. She was needed at least three bedrooms, two baths and a garage but getting a good deal was paramount.
When we set the initial search using a map search, price point and bedrooms alone, she had nearly a hundred homes to choose from. After a first day showing homes, I learned from this client that a master suite was a "must have" and any foreclosure home in severe disrepair was not to be considered. She really didn't want to be anywhere near Elk River or Anoka County. She wanted to be within minutes of Forest Lake and 35 and have a wooded backyard. After re-setting the search and reviewing the homes, I emailed my client 6 single family homes that met her needs. We saw all six for showings. After one day of viewing homes, she was ready to write an offer on one of the homes we saw. It met her needs perfectly!
Had this client chose to go it alone, she would have been overwhelmed, distracted and frustrated running to several homes that she really didn't want to buy. By setting specific criteria and using my expertise as an experienced agent, the number of homes quickly became a manageable amount. The buyer remained focused and was able to define her concept of an ideal home.
So what happens to the homebuyer that feels there are no homes that are meeting all of the required criteria? Remember, no home will ever be 100% perfect. If too many wants are specified, there may not be a home that will ever measure up. If the list of homes available is too short, see if any of the "must haves" are really necessary.
If you are buying, selling or relocating to Minnesota and need help from a professional REALTOR®, give me a call or visit my website for a FREE Relocation Packet or FREE Homebuyers Success Packet. I specialize in acreage and lakeshore properties in the north and east Twin Cities metro area including Ham Lake, Lino Lakes and all communities in the Forest Lake School District! Serving Anoka, Chisago, Ramsey and Washington Counties in Minnesota..JPG)
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Copyright 2012 Teri Eckholm http://www.terieckholm.com/
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Teri,
Such great advise for buyers. In a market like this, some people may never find the right home since they might be in a mindset: "what if there is a better home somewhere else"? It's setting and following a set of criteria based the most important priorities to get to the right property.
We have a service here called MLS Property finder which is much like Listing Book. It is outstanding. Listing Book just entered out market but will be hard pressed to compete as MLS Property finder has been here for a while. Good luck with the service. I am sure your clients will love it.
Thank you Teri. I always enjoy your blog. Happy Healthy Prosperous New Year.
Teri
Great advice for buyers; many of nice homes to look at, and they need to see them with you!
Goodness. I got a call from one of the local in my network last evening that a buyer I referred to him a year or so ago was under contract. The agent said he looked at over 100 homes.
I don't believe I've ever shown more than 12-15 homes to anyone before they buy.
We must be doing something quite differently.
Your post is excellent.
Not everyone who thinks that they want to buy a home will do so.
Teri we had 1 client that started with 1500 sq. ft around 200k they looked at 60 homes ended up at 4600 sq.ft at 760k. Who knows.
Great advice Teri!
Often times inexperienced agents show their clients way too many homes.
I would add that I never show more than 3 homes to a client on one day (it just gets way too confusing) and I always have them compare the homes to a "baseline" home so that they're less likely to get confused.
I also ask a ton of buying and closing questions (obviously!).
-- Danny
Teri...
This is so apropos in today's market. I think the most important limiting factor should be location. There is no point in finding the house you want in a place that you don't want to live because of distance to work, shopping, hospitals or whatever else is important to the buyer.
Yes, Teri, ah for the good old days when you could pick any Ford you wanted, as long as it was black.
Teri, this is all great advice for buyers (and sellers) out there. I think the key to beginning any search is to sit down and physically write out what it is you are looking for. Don't go to the market without your shopping list.
Teri, you gave some great information here! I am new to the business, so its nice to know that on average a homebuyer will see around 15 homes before writing an offer. Thank you!
Anna
Very timely post for me as I have a client looking at 3 different areas and wants to look at houses all day for 4 days...
I would probably show more than three homes in a day, but certainly not more than six or so. You simply can't remember much after six or seven, IMO. When we were looking ourselves, I think we probably drove by at least a couple of dozen and didn't go in, and looked at 20 or so inside and out. We were more "all over the map" than I expected, and we bought something I would not have thought we would end up with. But it all worked out!
Yes, I agree it is so easy to get distracted. great post!
Teri, You are so right. I try not to show more than 6 houses to a buyer in one day or they start to "run together". Great point in this blog.
This is a great topic. I understand buyers who want to "see everything out there". But in my experience, that is not the truth. Too many homes and they become indecisive. I try to limit the number of homes to seven per appointment. I've heard that is the brain's capacity at any given time (I am no scientist). I also encourage clients to drive by properties on their own if they have a long list. They can eliminate the ones in undesired areas and/or if they don't like the curb appeal. If they don't like the outside, chances are they won't like the inside. It also saves each of us a lot of time and helps the buyers prepare to take the next step when we find the right home.
Most of the "look at the entire home inventory" clients cool off after 2 days of looking and start to be more realistic. They can look at as many homes as they want with me in case they sign a buyer broker agreement and compensate me for my time and effort if they refuse to listen to my professional opinion and start looking for $400K home deals in $60K neghborhood.
I am taking some clients out tomorrow for the first time, going to ask a lot of questions and narrow things down as much as possible. This post was just in time.
Good post. I go out with my buyers a couple weekends so I get a good feel for what they want. After that, they're set up on automatic emails and if something promising comes up, I go preview it for them. I see a lot more homes than they do because that's MY job! I couldn't imagine a Realtor dragging their clients to look at every possibility. Listen to what they need, build the trust and let us go to work for them!
Good work.... I am showing property tomorrow and have made my self limit the number to 5 at one time. we'll see how the buyers fare.,..
I am working with a buyer now; this is very helpful. Thanks.
Buyers do get confused and someitmes it seems as though you wasted your time showing them so many homes but I tell my buyer agents that you are educating yourself on the inventory with every home you see. Then when you are working with someone else you can easily say you ahve seen that home and it either fits their needs or doesn't. Thanks for sharing your post.
Teri, I rarely show more than 5 or 6 homes. I like to qualify my people well and show them what they want to see.
With the tax credit expiring 4/30/2010, I bet sellers will feel like they need to put their home on the market to have a chance to sell. Therefore, more to choose from.
Good point, I find that sometimes if I leave too many results in on people's auto property alerts they tend to call me and ask me to widdle it down. It can be especially overwhelming for someone new to the area.
I think it's very case specific as to how many homes to view with your buyers. Everyone processes information differently and some people work best when having lots of information. Others get confused with information overload. Part of our job is to get as much information about what our buying clients are looking for and filtering that information for them to help them to focus on appropriate properties.
Terri great advice, a good agent can help buyers focus. Buyers can really get overwhelm by the amount of inventory available but there is no need to go through the entire inventory.
Oh, goodness, that would never do. Narrow down the focus, absolutely. My time, and theirs, is too valuable to be window shopping for a long time.
Start by asking what is absolutely non negotiable and what they would like, then go over the list a few more times to keep the buyers focus.
I ask my buyers to list everything they want in a home, than I ask them to pick the top 5-10 that they absolutely cannot live without. This saves lots of time looking at the wrong properties.
I think that it is so important to limit the search by focusing on what you really want-and this is a great post that I will share with my buyers!
It is important to try to get the buyers focused at the very beginning. I think you bring up a lot of good points and some great suggestions.
So well written Teri. I find it's particularly challenging when working with out of town clients. I have had many really nice out of town clients but it is so hard for them to narrow down the field especially when they are getting advice from so many friends.
Teri, Well said! I use Listingbook too and my buyers love it. As you said, it allows them to tweek their criteria if they see their wish list is too limiting! Cheers, Harley
I have a form I fill out with my buyers, one for each in the couple, that asks for a list of their must haves and their can't live withs. Then, we use this list to narrow down homes.
Looking at to many homes onl make them run together and then it's like... what did the home on 123 ABC Street have again ? Or was that 987 Your Street ?
Focus and the funnel down method work well for me. I tell them they won't buy a home the first day out, it takes the pressure off, even if they find one, they don't feel pressured to perform until the emotion of "the" one hits them. We look at areas and funnel down until they are ready to see only the area they are interested in. Sometimes they have to touch and feel the areas before they know that. Thanks for the refresher.
Great post! I think the more time you spend with them at your initial meeting...explaining the market, shorts sales, foreclosures, their criteria, etc. the easier it is for us to narrow down the number of homes we look at.
Teri
Great post - I always try to narrow my clients search for them based on their "needs" - they appreciate it and their search is simplified and more enjoyable - especially if they have their little ones in tow.
Controlling the situation not the buyer is the key to success in today (and any) market.
Tony
It seems that even in my smaller market the amount of homes for sale is daunting to buyers. Thanks for the timely post.
This is something that I will share with my clients. My last client I had,I showed him like 43 houses. Even though we put in offers on three different houses and one was a ratified contract that fell apart due to mold and other stuff discovered at home inspection. my client former client felt that I had to show him as many houses as he want as long it was in his price range. My former client also felt that if he wanted to buy a house in another city,then he will do that because it is his money. It didn't help that my former client was inpatient and wanted to see houses over their price range. Plus my former client wanted to see more houses after showing him like 7-8 houses a day. Now you see why this person is a former client.
Thanks for sharing this one Terri. Congrats on the Gold Star. Great post.
Teri - Yes it is important to make sure your clients know what they want in the first place... Prequaling them is my first step.. Great post Teri Happy New Year
Teri,
Great points! The needs vs. wants list helps me greatly. When a buyer finds something on the Internet and wants to see it, I can point out it doesn't offer this or that. Usually happens when buyer is over-focused on a "great deal" and not a great home...
Great post! I always try to sit down with the potential home buyer before we ever get in the car to discuss their wish list. It sometimes changes over the weeks of house hunting, but for the most part it helps to keep them on track.
Teri:
It is so important to narrow things down, particularly the desired location. I find that buyers who know where they want to be have much greater and faster success at finding a home.
The internet has been a valuable asset that can cut down the number of homes that you show. Preparing a buyer before they see the first house is the key. If you lose control of the process or never have control. you will drive yourself to the poor house.
Teri,
Every time it seems differerent. I had a client who saw a place and was so afraid to buy it. It was the first home and the first showing! The first everything! But soon he realized that it was the first and the best and he quickly wrote an offer and ended up with a gorgeous condo in the area he had dreamed about for $30k under asking! :-)
Wendy
I have really only run across one or two buyers who needed to look at more than a dozen or so houses. Most people are able to narrow down what they REALLY need and want by the 5th house...
Teri: Great points and good real-life examples. Thanks for sharing this valuable information for buyers.
Agents need to remember we are in sales. If you have to show someone 50 homes, something is not right. If I read the buyer right while at my desk, Then by the tenth house I have them sold. If I dont then that is when I ask them the question I should have already ask, which is ( If we find the home today, that suits your needs are you willing to decide today) if they wobble, then maybe you need to put them on the B list.......just my o2cent
It's a cliche' but communication is key in finding the right home for the buyers. Drilling down to the narrowest set of requirements saves your time and theirs from hopping from house to house for a number of days. Thank you for another informative blog, Teri! Have a great 2010!
Teri,
Excellent post. More power in 2010.
I think the current economy has increased the avg number of homes my buyers want to see. I love the tingly feeling I get when I know they've found the one.
Hey Everyone!
Thanks for commenting! I really appreciate all of your comments. I read each and every one but with the beginning of the new year I wanted to get out the sales stats for the communities I serve and didn't get back to this as quickly as I would have liked.
Bottomline...It is up to us as agents to educate our buyers as to how to shop for that home...saves time, gas and frustration all the way around!
Teri,
congratz in your featured blog :) what can I say here ? :) I control my buyers for what they need and this is an Amen !
Teri, thanks for your post and all the comments from others. We are dealing with buyers right now that want us to take them around to every listing, which is many. There are many properties that fit their needs and dreams, but after 2 days of showing almost 20 properties, we have drawn the line. We have not had this situation before, usually 10-15 houses max and then an offer is placed. So I am glad to hear other comments about drawing the line. Thank you. Gloria
Gloria--We all come across those buyers that just cannot make a decision. Sometimes they never do. If you have found several homes that meet their criteria but they still want to look for something better, maybe they just like looking and really don't want to buy. Hopefully by drawing that line you will find out which category these buyers fall into. Good Luck!