Cracking the luxury market
People are always asking us how to break into the luxury market, and while there are many answers we can give to that question, it does ultimately come down to that old business saying: it’s not what you know, it’s who you know.
In today’s newsletter, we have included one of the most interesting lists out there. It ranks the Top 100 landowners in the country, and to give you some perspective on who is on this list–Jeff Bezos and Bill Gates didn’t even crack the Top 20. Those poor fellas!
We placed the Top 10 names below, but we included a link to the full list. We encourage you to check it out. We know it’s wild to think of how you could possibly connect with one of the people on this list, but as we say below, if you want to succeed in the luxury market, it starts with thinking big. Very, very big!
– James and David
Lock-in effect starting to ease
88.5% of U.S. homeowners with mortgages have an interest rate below 6%, down from a record high of 92.8% in mid-2022. That’s the central conclusion of Redfin’s analysis of FHFA’s latest report on national mortgages. New listings are already up 9% this year, even though the lock-in effect is still real.
Here is a breakdown of current U.S. homeowner mortgages and the record high for each rate :
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88.5% have a rate below 6% (92.8% in Q2 2022)
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78.7% have a rate below 5% (85.6% in Q1 2022)
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59.4% have a rate below 4% (65.3% in Q1 2022)
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22.6% have a rate below 3% (24.6% in Q1 2022)
Our take
Don’t get us wrong: the lock-in effect is still real and still a huge reason why we don’t have as many active listings on the market as we should. At the same time, it’s also true that the number of people affected by the lock-in effect is falling. That’s why we’re seeing the rise in new listings this year. We strongly advise you to take advantage. Although we believe that mortgage rates will decline throughout this year (while remaining in the sixes), they may rise if bond markets negatively react to unwelcome inflation and unemployment news throughout Q1. So we suggest acting now while economic forces are (relatively) in our favor.
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10 best markets for first-time homebuyers in 2024
Presented by Homes.com
Here is a list of the 10 best markets for first-time homebuyers in 2024. They looked at the nation’s 100 largest metros by population and ranked them according to key metrics that attract first-time buyers: housing affordability, job opportunities, shorter average work commute, culture and liveliness, and more. Here’s their list:
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Irondequoit, NY
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Benton, AR
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Winterset, IA
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Newington, CT
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Council Bluffs, IA
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Cheektowaga, NY
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Grand Rapids, MI
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Moore, OK
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Mattydale, NY
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Riviera Beach, MD
Our take
Fortunately, there are a lot of factors working to help first-time buyers get in the game. Housing affordability is improving after we hit an all-time low point last year. Home price growth is slowing. Mortgage rates are dropping. Inventory is inching up. This should make it easier for first-time buyers to purchase a home this year. We suggest looking over the criteria used to make this survey and what the results found. That should help you hone in on what first-time buyers are hoping to find.
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The top landowners of America
The Land Report, the most authoritative publication on land transactions in the country, has published its list of the top landowners in the country. To give you some perspective here, Jeff Bezos is number 24 on this list, while his overall real estate portfolio is worth more than $570 million.
Here’s their top 10, ranked by number of acres owned:
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Emmerson Family – 2,411,000
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John Malone – 2,200,000
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Ted Turner – 2,000,000
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Stan Kroenke – 1,700,000
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Reed Family – 1,661,000
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Irving Family – 1,267,792
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Buck Family – 1,236,000
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Singleton Family – 1,100,000
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Brad Kelley – 1,000,000
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King Ranch Heirs – 911,215
Our take
We included this list in today’s newsletter for a particular reason. We know a lot of you want to become players in the luxury residential market. These are the types of people you need to know. They may not be in your database now, but aspire to have them in there. They don’t just buy land, they are the movers and shakers of our economy. Study how they acquired their wealth, their business ventures, their choices, etc. It will take time, but broaden and expand your circle of influence and connection. The bigger you think, the better.
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Schematics
The news that just missed the cut
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Use this strategy to stay top of mind with leads and clients
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5 dining room decor tricks to create the ultimate cozy space
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@$2,400 per square foot, this is New York’s priciest neighborhood
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Tom Brady’s luxe waterfront mansion nears completion in Miami’s exclusive ‘Billionaire Bunker’
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The plans to build a Vegas-style sphere in London just got cut
Foundation Plans
Advice from James and David to win the day
As you know, we are huge proponents of door-knocking as a method to garner leads in your brokerage business. But Kris and Vinny, our intrepid colleagues, proved that hosting open houses can lead to tremendous opportunities and success as well. Today we’d like to offer you some tips we’ve not shared before on how you can optimize this technique to gain leads and, ultimately, sales.
Collaborate with a trusted lending partner to co-host your open house – If you have a trusted lending partner in your market, have them co-host the open house with you. That way, you can answer questions about the home, while the mortgage lender can be there to answer questions about financing. This would especially be helpful for first-time buyers. How high does my credit score need to be? What’s the maximum acceptable debt-to-income ratio to qualify for a home loan? Do you have a down payment assistance program or can you recommend one?
Put together branded packets – Anticipate visitor questions at your open house by offering free materials. Provide an FAQ sheet with a QR code for quick access to property details and your promotional efforts. Make it effortless for attendees to learn about the home and discover the benefits of choosing you as their selling agent.
Make your client’s home more inviting –Take a cue from Disney's playbook to enhance your open houses. Just as Disney cools its stores to such a degree to boost sweater sales in the summertime, adjust the temperature at your open house for comfort. Arrive early to set the right ambiance with soft lighting and background music. Create an inviting atmosphere with pleasant scents and aromas, such as freshly baked cookies.
Host open houses for other agents – If you’re out there networking with other agents, you’re more likely to have an opportunity to host a fellow agent’s open house for them. Sam Coleman, one of the most successful agents in Vegas, built his business by hosting open houses for another agent and door-knocking. Listen to how he did it here.
We encourage you to listen (or relisten) to our conversation with our colleagues Kris and Vinny. They explain how they used open houses (among other things) to go from $0 in annual real estate sales to $100,000,000. It’s an inspiring true story of success. Learn from them and use their success story to spur your own success this year.
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An on-demand course created by James & David
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Just in Case
Keep the latest industry data in your back pocket with today’s mortgage rates:
Source: Mortgage News Daily
That’s a wrap on this edition of The Blueprint!
Whether you’re new to the Blueprint community or not, we want to hear what you think! What’s your take on today’s stories and tips? Send us a note with your comments, questions, or suggestions.
Thanks for reading, and we’ll see you back here on Friday!
– James and David
