Navigating the Market of Low Inventory
There’s no way around it: inventory is down. Across the board, we’re seeing less and less homes than are able to meet buyer demands. Per Zillow inventory is down overall 25%, with new build startups down even more. It’s a challenge for increasingly more markets, and it has been especially rampant in my own, the Greater DC area, for a number of years now.
But there are many ways and various tips you can use to combat and navigate this market of low inventory. In “The HyperLocal HyperFast Real Estate Agent” as well as the Companion Guide I offer countless solutions that I’ve found successful, but I’ll offer a few for you here today.
Selling Off Market
Finding homes before they go live on market is key to attracting new buyer clients, making your current buyer clients happy, and giving them great results. If you find a home that’s not on the market, you’re offering them something that no one else can. For reference, we sell about 20% of our homes off-market.
You can do this by looking online, because a lot of sellers will try and list their home either for sale as a coming soon or a make-me-move on Zillow, Trulia, Craigslist, and even for sale by owner.
Targeting Specific Owners
Another way to try and find homes off-market is by targeting specific owners. When doing this, really dial down in on what your buyer wants, what specific type of home or condo or townhouse – whatever it may be – and filter it down. Sometimes there’s a dozen or more possibilities on the low end; sometimes there’s a couple hundred. Send letters to those homeowners and tell them – you’ve got a willing and able buyer, that inventory’s low, and that they can be flexible, potentially, with the terms and the timing. By doing this for them, you’ll save them the time, stress and hassle of going on the market.
Just tell them, “If you’ve been thinking of selling, even if the time’s off by as much as a year, you may be able to work out a deal”, and ask them to contact you. I’ve sold several homes like that and detailed many of them in my books.
Targeting Homes For Rent
Another way is to target homes that are listed for rent. These owners are listing it for rent because it’s either vacant or the term is coming up; but a lot of the times they will sell for the right price. So that’s another group to target.
Contact the Top Agents
Of course, you should also be targeting the top agents in the area for exposure to the best array of options. Usually, certain neighborhoods will be dominated by two or three agents. Don’t hesitate even to ask them outright if they’ve got any listings that’ll be coming up in the next three, six months, or however long your buyer’s timelines is. It’s about proactively taking the initiative to get the job done.
Prepare Your Buyers to Compete
Those are just a few ways of finding homes off-market, which should help you deal with the market of low inventory. The other thing you’ll want to do is really prepare your buyers ahead of time to be competitive, so that when the right off-market or on-market property comes, they can be competitive and ultimately win out – and not necessarily with being the highest offer.
We pride ourselves in the fact that our buyers consistently win out, beating other offers without necesarrily being the highest. This is possible because they win on terms. They’ll offer more flexible closing deadlines, according to what the seller needs, as well as offer fewer contingencies. A lot of the contingencies that are in typical contracts are loaded with too many conservative features and protections that many buyers don’t need; but most agents just don’t address that up front. If you address that up front, the buyer may be willing to eliminate, reduce or modify the contingencies you find in a typical such contract.
So those are great ways to look into more specific details on how to do that but, you know, the bottom line is that if you can help your buyers find a home that no one else can, and help them win out in situations without necessarily being the highest offer, you’re going to be able to attract and retain and win more buyer clients and build a better business.