Spiraling home values, soaring inflation, and increased interest rates mean less buying power for ALL consumers. Unless your clients have a job where their income keeps pace with inflation, the house they can afford today may be out of reach tomorrow.
On today's show, Bernice Ross and Greg McDaniel share a step-by-step guide for persuading your clients they need to transact now. This is an essential skill you need to develop NOW because of the soaring home prices, inflation, and increasing interest rates that are already negatively impacting the market.
Here's what they will be discussing:
#1: Increased housing prices--expect another major increase according to Zillow. Bernice and Greg breakdown how much this actually is based upon a home priced on $300,000 at the beginning of 2021. The numbers will astound you especially when you see how much this is per month!
#2: Increasing interest rates translate into less buying power for buyers
Assuming the interest rates increase by one percent, here are the two concerns to discuss with your clients:
• How much more they will pay in interest overall for the loan.
• The additional income they will need to earn to qualify at a higher interest rate as opposed to purchasing now.
Bernice explains exactly what to say when it comes to explaining the impact of rising interest rates. The amount of extra interest the borrower will pay, depending on if they stay in their home 10 or year years and if they have an 80,90, or 95 percent loan, ranges on the low side (10 years, 80 percent loan of $29,986 to $66,019. Learn how to have this conversation with your clients to get them to transact now--the savings are substantial.
What's even more concerning is how much more they will need to make next year as compared to right now, to qualify to buy the same home.
#3: Inflation
If you don't understand how this works, a 5.4 percent inflation rate will make your $100,000 in savings or income worth $94,600 a year from now. Again, listen in to hear how to use this argument with both buyers and sellers to transact now.
Be sure to catch the end of the video were we tell you the actual amount based upon these numbers a house that was worth $300,000 will be worth at the end of 2022. This number will close almost any reluctant client on transacting now.
This session is pure gold--the strategies discussed have worked in previous markets and they will work in your market. Check it out!