What The Godfather taught us
The other day we watched one of the greatest films ever, The Godfather. We were amazed by how much Robert Duvall’s character Tom is an excellent role model for us as agents. Like Tom, we need to be our client’s “consigliere”, a trusted and close advisor.
In our line of work, trust and respect are absolutely crucial. Your clients must believe that you have their best interests at heart. Also, they need to respect your expertise when you say, “No, you shouldn’t buy this property” or “No, I think that’s overpriced.”
As simple as it sounds, there’s only one way to win that trust: always tell the truth. Sometimes, it’s our job to deliver the news that our clients don’t want to hear. But if you can do that, ultimately, they will respect you for it.
– James and David
Zillow makes big revision
Source: Unsplash
Zillow has significantly revised its outlook for real estate this year. Here’s what it now forecasts for 2023:
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Home prices are projected to rise by 3.9%
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Mortgage rates are going to drop
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Sales of existing homes will be about the same as initially projected
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Inventory of homes for sale is going to be lower than previously forecast
Our take
This is excellent news. At the start of the year, Zillow was forecasting home prices to increase maybe by 1.7% for the year, so this is a big and welcome revision! To capitalize, we need to put in the work now to line up potential creditworthy buyers. The competition is going to be fierce since the number of homes for sale is so low. So prepare now!
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The suburbs are thriving
Source: Unsplash
The suburbs across the US are growing and doing better than ever, driven by the growth in hybrid and remote work. That’s according to the latest report from Axios. Here are the key points:
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45% of millennials, the largest generation, are buying homes and settling down in the suburbs.
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In 2022, urban retail vacancies surpassed suburban retail vacancies for the first time since 2013
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Even before the pandemic, the percentage of Americans living in the suburbs grew by 10.5% between 2010 and 2020
Our take
Every agent should be rejoicing. Our bread and butter is made by selling homes in the suburbs. When they do well, we do well. When they thrive, we thrive. But here’s the best part: the success of the suburbs doesn’t have to come at the expense of the city. As the report itself notes, even with hybrid work, people are returning to downtowns. 15 of the largest metros in the country have actually seen an increase in residents. This is a win-win.
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Where rent is cooling the fastest
Source: Data USA
For the 11th consecutive month, rent growth has slowed across the country. The region with the largest rent declines is the Sun Belt. That’s the key finding in Redfin’s latest report.
8 of the 10 metros with the largest declines are in the Sun Belt:
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Austin, TX (-14.3%)
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Phoenix, AZ (-9.6%)
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Las Vegas, NV (-7.1%)
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Oklahoma City, OK (-6.4%)
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Chicago, IL (-6%)
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Birmingham, AL (-4.5%)
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Sacramento, CA (-4%)
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Memphis, TN (-3.6%)
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Seattle, WA (-3.2%)
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Dallas, TX (-2.8%)
Our take
We couldn’t be happier with this news. Rents surged during the pandemic because people moved to the Sun Belt looking for affordable homes and warm weather. But now they are falling because apartment supply has finally started catching up to demand. This means people can afford more now, and we’re slowly but surely winning against inflation. The faster we win that battle, the faster interest rates can go down, and the better our industry does.
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Schematics
The news that just missed the cut
Source: Unsplash
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There are more starter homes for buyers now
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Lebron’s impressive real estate portfolio
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JPMorgan is now a landlord
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This agent used a dog influencer to make his video go viral
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This real estate battle is on like Donkey Kong!
Foundation Plans
Advice from James and David to win the day
We are in the most pivotal part of the year as agents. What we do in the next 110 days or so has the potential to make or break our season. That thought can be both exhilarating and nerve-wracking.
Here are three things you can do to start taking action now:
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Make your calls: Let people know you are there for them and what is happening in the market right now. Prices are going up and mortgage rates are going down. Those are facts, not opinions. Share them!
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Post a video on IG: You don’t need a listing to post on social media. Post an update on your market. Post interesting trends you’re seeing. Post your thoughts. Whatever it is, get out there and introduce your genuine self to the world.
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Host another agent’s open house: If you don’t have any listings, consider contacting fellow agents in your office and ask if you can host an open house on their behalf. And while there, make connections! As we always say, it’s not who you know that matters, but who you get to know.
To learn what else you can do, we encourage you to read this from our friends at BAM.
Q+A
You ask, James and David answer!
Q: How do I really explain to people – who actually don’t know- the value of why having a good agent is so important? People who have never bought a home before and have an idea in their heads that agents just open doors and aren’t needed now that people can find inventory on Redfin/Zillow?
A: We hear this a lot and can go on and on. But it’s crucial to remind them that this is such a big purchase. You want someone who understands their needs, on every level. Remind them that the process is complicated and that agents have the skills and expertise to guide them through it. If someone doesn’t understand that, then this isn’t someone you should waste your time on.
We’ll be back next week with another answer to a real reader question. Submit yours here!
Just in Case
Keep the latest industry data in your back pocket with today’s mortgage rates:
Source: Rocket Mortgage
“The secret of getting ahead is getting started. The secret of getting started is breaking your complex overwhelming tasks into small manageable tasks, and starting on the first one.” – Mark Twain
Thanks for reading, and we’ll see you Friday!
