Written By: Karen Deis
In the last issue (5-5-08) of this e-zine, we dissected the NAR Survey of Home Buyers and Sellers 2007 report and created a White Paper entitled What You Need to Know When Working with First-Time Homebuyers!
The White Paper in this article dissects the characteristics of REPEAT BUYERS and where it applies, shows you the differences between working this niche versus the First Time Home Buyer market.
Armed with this information, one size does not fit all! Loan officers and real estate agents, working together, will need to create specific marketing campaigns. One of the most startling stats in this survey is that only 17% of repeat buyers used the same agent they used previously—which means that 83% are NOT going back to the agent they used before. If this is correct, my guess is that the same holds true for loan officers. This is where your database, and a consistent and targeted contact management system, will help increase your odds of getting repeat clients and referrals.
Repeat homebuyers are defined as buyers who previously owned residential real estate. With almost 60 percent of all the home purchases being made by repeat buyers, the dilemma for loan officers and real estate agents is that after a home has been sold, an average of 10% will wait approximately two years to buy another home. There are several reasons for this. First, some of the sellers had to sell their home because they could not afford the increase in the monthly payment due to an adjustable rate mortgage. Secondly, 23% purchased a newly constructed home, which takes time to build.
Included in the statistics is the fact that one in ten repeat buyers own a second home. As the baby boomers get older, it’s more likely they will purchase a second home. They are also purchasing investment properties (both residential and commercial). The reason is they need the cash flow from the monthly payments to supplement their retirement income.
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