How to Help First-Time Home-buyers Overcome Fears and Barriers to Home-ownership
Having to help first-time home buyers overcome fears isn’t something that all realtors have to deal with, and it’s true that the majority of non-homeowners like the idea of purchasing a home someday. According to a National Association of Realtors (NAR) news release, consumers “maintained a favorable view about home ownership, with over 90 percent of homeowners and roughly eight out of 10 non-homeowners each quarter indicating that owning a home is part of their American Dream.” That sounds like pretty good news for real estate agents, right?
Don’t get excited just yet.
That same news release also reported that “optimism about it being a good time to buy diminished among non-owners. The percent share who believed it was a good time to buy declined from 63 percent in the first quarter to 55 percent in the fourth quarter.” So, why is it that a growing percentage of non-owners feel that now is a bad time to buy despite positive feelings concerning eventual home ownership? Well, it seems that a mixture of home buying fears and perceived home buying barriers are to blame.
The Biggest home buying Fears and home buying Barriers
The biggest home buying fear is, as you might expect, not being able to afford the purchase. In itself, this isn’t necessarily a bad thing. For potential home-buyers struggling to pay down student debt, taking on another huge loan often isn’t a good idea. On the other hand, for people with stable income and relatively minor monthly expenses, these fears can be counterproductive.
When it comes to home buying barriers, poor credit is probably the most common. Would-be home-buyers often assume that poor credit will ruin their chances of getting approved for a home loan. In many cases, however, this simply isn’t true. Another common home buying barrier is the inability to make a substantial down payment. By taking on a non-conventional loan, like an FHA loan, it’s possible to break through this barrier.
Help First-Time Home-buyers Overcome Fears With Information
As a real estate agent, there’s only so much you can do to help your buyer clients overcome their fears concerning home ownership. Despite your best efforts, there’s no sure-fire way to help first-time home-buyers overcome fears. What you can do, however, is ensure that your clients have the right, most relevant information concerning home ownership. Here are a couple of the things you should ensure your first-time home-buyers know about.
Mortgage options — You don’t want to lose out on a commission because a would-be buyer doesn’t know enough about their mortgage options to feel comfortable getting a home loan. In addition to going over the different types of mortgages out there, consider going into what mortgage payments might look like on a month-to-month basis.
Market conditions — Home-buyers don’t need to be overwhelmed with too much in-depth market information in order to make a smart property purchase. However, they should know a little about the local market and current loan rates. Making sure your clients have this information is a great way to help them feel more comfortable with you as an agent and with the idea of purchasing a home.
All clients force certain challenges on their agents, and fear-driven fickleness is one of the challenges of working with first-time home-buyers. To overcome this challenge as an agent, you must be able to help first-time home-buyers overcome fears with the right information and plenty of support.
Pat Hiban is the author of NYT best selling book “6 steps to 7 figures — A Real Estate Professional’s Guide to Building Wealth and Creating Your Destiny”, founder of Rebus University and the host of Pat Hiban Interviews Real Estate Rockstars an Agent to Agent Real Estate Radio Podcast with Hiban Digital in Baltimore, Maryland. Follow him on Facebook or Twitter.