What’s happening in the Real Estate Industry

Jim Forrest and Jane Petrusevski (Petro) with the Loan Lowdown, and today we have three agents from The Jana Caudill Team brokered by EXP Realty. With us today we have Carrie Nichols, Lauren Detamore and Sheila Chandler, and they offered to sit down with us and we're going to ask them some questions that pertain to the real estate market today. So, let's dive into it.

1) Question to Lauren Detamore:
"What's the biggest misconception buyers have when they first come to you to look for a home?”

Answer:
The biggest misconception people have is that “buyers” think “sellers” are asking too much for their properties so they can truly negotiate down on price. Sometimes, they may not be realistic about the offer they want to make. So we need to tell our buyers that most of the time, sellers set the price of their home based on the current market. We (the real estate agents) also show them something similar to the house they’re interested in. This helps them make the best offer so they can negotiate the best price on the house they desire.

Jim's seen some buyers actually lose the first home that they're interested in because of that exact reason. And then they (the buyer) spend six more months or a year still looking for that next house again, and then they say to the real estate agent, "You know what? “I probably should have just bought that one."

2) Question to Sheila Chandler:
"Who are the typical buyers you're working with right now

Answer:
It really is a blend. Sheila would say they are seeing “Moving Up Buyers,” which are families that are relocating from a smaller house to a bigger one or moving into a neighborhood with better schools.

Sheila mentioned they are getting many first-time homebuyers, and the homes usually cost between $200,000 and $300,000. Many people that move to this area, especially from Illinois, do so because of taxes and costs. The Jana Caudill Team services 18+ towns and cities in Northwest Indiana. If you want to move, The Jana Caudill Team can help you.

3) Question Lauren Detamor:
“Where are buyers struggling the most? Are they having trouble finding homes, winning offers, or closing deals?"

Answer:
Lauren believes that the key factor is finding homes, which she attributes to the way The Jana Caudill Team organizes the entire process, including the number of homes you will view online compared to those you will see in person, as well as what you can expect to find within your desired price range. So, once more, you don’t think these houses are too expensive and should cost less. No, we need to be honest about what the market is like right now. That will make it simple for them to find the house they want.

4) Question: Carrie Nichols
"What mistakes cause buyers to lose homes they really want?"

Answer:
Carrie would absolutely say that not being prepared, and not being financially pre-approved. She has seen buyers who respond, “Oh, no.” We just want to see open houses. We just want to check things out. Then they call and say they prefer one, and we say, “We need a pre-approval.” We need to be sure that you can buy this house. Then they had to stop in their tracks and almost take a step back. On a Saturday, we call Jim at Real Estate Resource Home Loans to get them pre-approved. The difficulty is that they want it now, but another buyer has already made an offer and it has been accepted.

Carrie sometimes finds out that they can’t even afford the house they were looking at. Of course. Carrie tells everyone who wants to buy something that they need to get pre-approved so they don’t end up looking for something that will disappoint them or maybe they can obtain more than they think they can. A lot of folks don’t even know what they can obtain, so they check on Zillow and think, “Oh, we could probably afford this, or we could probably handle this.” And they don’t know how much work you (Jim/Jane) put in to get them accepted for something they can afford. Carrie clearly thinks you need to know where to shop, and you need to know that by having your money in order and getting pre-approved by a lender.

Every weekend, someone calls them (Jim, Jane, or the Real Estate Resource Home Loans Team) with something they’ve already talked about and wanted, and there are numerous bids on it. For example, they could be self-employed, and Jim has to perform hours of work to get someone pre-approved, which takes time, and we don’t want to make a mistake. Mistakes are prone to happen when the team feels like they have to hurry.

Being pre-approved is the the most crucial thing to do when looking for a property. Every buyer gets a “buyers consultation” before they meet with an agent at the real estate office. And they send them to get pre-approved before they meet the buyer. They want them to come to the table so they can talk about what Lauren said, which is what they expect.

The Real Estate Resource Home Loans is getting a lot of folks who have been turned down and some who have just given up, even though they can actually have the loan authorized. You should get your alternatives from a lender you trust. You should work with a real estate agent who knows what they’re doing for this reason. They can get you the lenders you want.

5) Question Lauren Detamor:
"Are buyers still facing bidding wars or is that starting to change?"

Answer:
Things are starting to shift in the bidding process. It all depends. It depends on the price range and the subdivision, so it’s impossible to offer a general answer to that issue. However, there are still bidding wars going on.

Question:
“What's the price point where there are more bidding wars? What properties are sitting in the area.”
If a home is move-in ready, and there hasn't been a lot of inventory in that particular area for quite a while, then it's that pent-up demand. So that home comes on the market, that's going to be the one, no matter the price point, that's going to get that bidding.

6) Question to Sheila Chandler:
"What's sitting on the market longer and why?"

Answer:
Properties that aren’t advertised are on the market longer, which is what the major ones are. They stay on the market the longest. She sees this over and over again, and she shows it to her buyers and sellers when they chat about the listing price. They have a certain number in mind, but you really need to look at the comps in the region and determine the figure that works best for that house. Or what we call the “Sweet Spot.”

Jane doesn’t think many people know what the real estate agents use and get for comps. She believes that when people are checking online for the value of their property, they see something that says, “This is what you should get.” As a seller, you imagine that people think their house is worth twice as much as this one. When Carrie talks to others about this, even buyers and sellers, she always emphasizes, “You need to remember that Zillow is an APP, that’s ‘Clickbait.'” The app is made to persuade you to click on that link so they can make money. When it comes down to the end, the payout is wrong half the time. People will demand that price and stick to it, but that’s not what will really happen. People that work in the market every day, like real estate brokers, are the ones who can tell you what the market is really like. It’s like what you see on the web. There’s a lot of fluff here, and you need to know the truth behind it. They also don’t know if the buyer is going to get an appraisal done with comparables that the real estate brokers have already viewed. That makes a big impact because you want it to come in at the price you desire.

Zillow has “clickbait” for real estate agents, and “Credit Karma” for mortgage counselors, which is a problem for them in the same way. People need to know that Credit Karma is a business that sells things.

Zillow is simple to use, and real estate brokers use it all the time, but you need to know the truth behind all the “fluff.” When you buy a house, there are more things to think about than just the figures. The real estate brokers can pull up the comps, which show if it was bought with cash, financing, or what kind of financing. There are also limits on how much money you can make. There is a lot that goes into it that people don’t know.

7) Question Lauren Detamor:
"How prepared are buyers when they start looking today. Are most of them pre-approved? Do they have money saved up? "

Answer:
How ready are the buyers? It all depends on the client. But for example, a first-time house buyer who has a lot of inquiries doesn’t know where to start. So we (the Jana Caudill Team) help clients choose their desired lender to get pre-approved. They aren’t lenders, so they can’t tell you the rate, how much money they need to put down, or what their payments would be. Those are questions the agent can’t answer. A lot of people say, “I want to buy a house, and I want my payments to be $2,000 or less.” The agents don’t know what price range the house is in because they don’t know how much money they have saved or how much they are putting down. They let the mortgage experts handle all of that.

Most buyers are partially ready because buying a property is a fun and exciting moment, and they either want to move to a bigger home or are moving. A lot of people can also access information online.

8) Question: Carrie Nichols
"What compromises are unwilling or willing to make?"

Answer:
When buyers walk into a house, the things they don’t want to change have already been taken care of. The location, the school system, the layout, the size of the house, whether they want municipal water or well water, and how far it is from their employment and the commute. And all of those things are taken care of at the first “buyers consultation.” They are good at little things like painting and putting in new floors. People are more worried about items like the furnace, the water heater, the air conditioning, the windows, and the roof. Another thing is the basis. How is that? Those are the most important topics that people need to think about, and we may talk about them when we negotiate. Most of the sacrifices that the real estate brokers don’t want to make are easy to avoid. But once we get inside the property and they look at everything, and it’s time for the inspection, these compromises are a little different. You can’t deal with those ahead of time.

The real estate agent is already asking about the age of the roof or the furnace before the inspection. These are expensive things that a homeowner will need to plan for in their budget. Homeowners insurance is also become a lot more expensive, and the age of the roof is a very important factor when buying a home. Be aware, insurance agencies won't cover a home because the age of the roof, and some people don't know the age of the roof.

The Real Estate Resource Home Loan team tries to pre-approve clients based on a figure, but they don’t know what some of those numbers will be like insurance until it gets closer to closing time.

9) Question Lauren Detamor:
“What homes are getting snapped up the fastest?"

Answer:
It's a price war and a beauty contest. So if they look good and are they are priced right, those are the homes that will be snatched up.

- -
ENDING QUESTION: If you could give one piece of advice to buyers today, what would that be?

Sheila Chandler:
Be logical in your thinking and not emotion. Focus on purchasing a home that you can afford, and that you're comfortable with the payments and not what you want and hope that someday your salary will change. Basically, don't get in over your head. Definitely be pre-approved, speak with a lender, have that conversation before you even set foot in the door and that you know what you are comfortable with.

Carrie Nichols:
Be prepared. By preparation with The Jana Caudill Team consultation, and sitting down and talking about everything that needs to be done, before the search begins. She has so many people that say "No, no, no, no. I don't want to meet. I want to go look at this house." She understand that you want to look at a certain house, but the real estate agent is making someone leave their home, and having all of these arrangements be made and you're not even ready to put an offer in. So, let's be realistic and considerate. You and your real estate agent can look at photos online, but let's get ready so when you walk into that house, if that's the one, we're making an offer. Be prepared.

When you are buying a pre-lived in home, you are not buying a new construction home. So be realistic with your expectations. People want to nit-pick everything, and if you want a custom built home and go up a few hundred thousand in dollars, here is where you are. Buying a house is one of the biggest decisions you make in your life. You should know what you are getting into. It's your money. It's your investment.

Lauren Detamore
Have fun during the home buying process. Hire someone that you trust that you can have fun with, that's also knowledgeable, that you can trust. Let it be someone you are comfortable with. Some times the home buying process can be along process, when you get from Point A to Point B with buying a home, so you want someone you can JIVE with 🙂

We were honored to have The Jana Caudill Team NW Indiana, brokered by EXP Realty team as a partner with The Real Estate Resource Home Loans. Give the The Jana Caudill Team NW Indiana team a call today: https://www.janacaudillteam.com/