Three strategies to show worried clients that now is the time to sell.
Right now, many sellers who also have to buy are dragging their feet because they’re concerned about everything currently going on with our economy, like inflation and increased interest rates. However, they’re missing the bigger picture: Real estate is the best hedge against inflation. Here are the three main strategies you can use to explain to sellers why now is the best time to sell their current home and buy a new one:
1. Put less money down. The majority of homeowners have equity in their homes, which can help them put less money down on their next house, like 5% instead of 10% or 20%. They may have equity left over, which they can use to pay off other debts such as car loans or credit cards. The only tax-deductible interest they have is the mortgage interest.
2. Subsidize their payments. If sellers are uncomfortable with what their new mortgage payments will be, they can buy down their interest rate. Again, if they do the minimum down payment, they can use any additional equity toward lowering their rate. Then they’ll be building their equity back up because their new home will appreciate approximately 6% annually.
3. Inventory shortage. Inventory shortages will continue for the foreseeable future. Home builders are building at a rate of one million homes per year, but we are short five million homes because they weren’t building enough for 13 years. So there’s no use in waiting for more homes to come onto the market because it’ll be a long time before enough are built to make much of a difference.
These three points can assist you in helping your sellers make the right decision. Remember, just as rates go up, they also come down, so remind your sellers that they can also refinance in the future.
You can get a more in-depth look into this topic by clicking the Free Downloads link on this page. If you have further questions about this or any other matter, call or email me. I would love to help you.