How to Be a Resource to First Time Home Buyers
- posted 2.4.2016
- Courtney Lynch
- Real Estate Business
For many, buying a house for the first time represents the biggest purchase they have made so far. Real Estate Agents need to be sensitive to those entering the housing market for the first time.
Every homeowner was, at some point, a first time home buyer. Being in this position can be confusing and somewhat scary. For many, buying a house for the first time represents the biggest purchase they have made so far. Real Estate Agents need to be sensitive to those entering the housing market for the first time. There are many different types of prospective buyers agents encounter—experienced, first time, veteran—and each one should be approached differently.
Chances are most Real Estate Agents will work with first time buyers at some point in their career. According to the National Association of Realtors, this population makes up about one-third of home buyers today.1 Zillow explained these people often don't know about the home buying process.2 Agents should be prepared to help educate first time home buyers and make sure to understand the unique needs of the first time home buyer, including loans for first time home buyers. Not only will knowing how to best communicate with first time buyers give them a good home buying experience with real estate, but it will help gain their trust, and position you as a go-to expert for their real estate needs.
What First Time Buyers Want
JD Power explained in a press release that first time buyers want specific characteristics in their real estate agent.3 It also noted that, by branding themselves as resources for first time buyers, agents can set themselves apart from their competition.
Christina Cooley, the diversified services industries practice's director at J.D. Power, said "This population of home buyers need good communication from their agent. They also want agents to show them how home buying works." Agents can benefit customers by explaining every step of the process.
"It's up to the agent to build confidence in buyers by educating them and demonstrating a commitment to working in the best interest of the customer," Cooley said in a press release. "...The more seamless the experience, the less overwhelmed customers are likely to be. When agents take the lead, customers are also more likely to appreciate their real estate firm and agent for their expertise and customer focus."
first time buyers want their Real Estate Agents to be knowledgeable and helpful in the home buying process.
Become a Go-To Resource
This may mean answering many questions with no guarantee of business. After all, prospective buyers may decide that renting is the best option for them right now. However, they will appreciate the attention you give them and will likely turn to you when the time is right to finally buy a home. The desire to own their own home is what propels 60 percent of first time home buyers to purchase, NAR found. That being said, it's likely those who decide it isn't the right time to buy will return to the market sooner or later.
Being a resource for first time buyers means being honest about what lies ahead for them. Give them advice on what to do, but don't overwhelm them with information.
According to Realty Times, there are certain pieces of advice all first time buyers should know.4 During your meeting, explain the importance of preapproval for a loan. Buyers need this to get an idea of how much house they can afford. Give clients information about recommended lenders in your area. Also, explain how they can receive their credit report and why this is important.
Agents should also talk to clients about any incentives or programs they may qualify for. Down payment assistance programs are great resources for first time buyers who might not have the money saved up for a down payment. In Touch Today advised agents to have contacts with several DPA programs in your area.5
Be Open and Honest
During the meetings, make sure potential clients know what role you play, what responsibilities they have, and be clear that there aren't any obligations. Laying all of this information out for them at the beginning of your relationship will make the client feel more comfortable, Zillow explained. Letting them know how payment works—through compensation split between the seller's agent and yourself—will usually relieve them as well as make them more courteous of your time.
The meeting should also benefit you by getting to know the customer. The more you know about your potential client, the more helpful an agent you can be. For instance, you should find out what kind of home they are looking for. This will not only help you find homes in line with their interests, but also make them really think about what exactly they want in a home. For first time buyers, it's important to help them think about this step. They may end up realizing they're not really sure at all about homeownership or about what they want.