Homeowners and Home Buyers Sidelined by Perfect Economic Storm

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In recent years, debt for the average American household has skyrocketed. This brewing economic storm has caused many sorts of problems for various industries, especially the homeowners who are selling and the would be buyers to be wary of purchasing a home. High-debt and a sluggish market are the perfect economic storm forces which have caused the real estate and property market to stall. This is the tipping point which is technically called the lock-in effect by experts.

What is Happening in The Current Property Market?

A perfect economic storm of various economic forces and factors have caused homeowners to not want to sell any property and buyers unable to purchase any homes for themselves. This is definitely causing a slow-down in homeowner and buyer market. A lot of homeowners are unwilling to sell, and many buyers cannot afford to purchase any real estate. This economic storm in the housing market has also caused the housing prices to soar, despite the relatively slow down and lock in effect. The various forces at work in this economic storm will be listed down below. If you want to get to the bottom of the cause of this economic storm, then keep on reading.

Higher Household Debt

A lot of people are in more debt nowadays. Credit card debts, student loan debts, are just some of the factors which are part of this perfect economic storm. This has caused prospective and young home buyers to stall in buying their first home because they are in a lot of debt.

Homeowners Unwilling to Sell

Many homeowners are also seeing this economic storm of high debt, and it has caused them to stall in selling their homes. If more homeowners are unwilling to sell their real estate, then that will thin out the market of available properties, this can drive up prices of the already expensive real estate. This causes more buyers to not even be able to afford a new home.

Not Enough Starter Homes

Another force at work in this perfect economic storm is that there is an imbalance in the inventory of homes available. There are a lot of luxury homes on the market, but not a lot of starter homes. Luxury homes tend to be very expensive, and not a lot of first-time home buyers are able to afford them. So this huge imbalance in inventory has sidelined many home buyers and also caused homeowners to not want to sell their starter homes as well.

More and more people are getting locked out of the housing market, due to the perfect economic storm that has been raging for the past few years. There is currently no end in sight to this economic storm I the real estate and housing market. Young people would rather rent than buy a home, due to the economic storm that is happening in the housing market. This economic storm is also expected to cause interest rates to go up even further in the next few years. This huge increase in interest rates may cause young home buyers to not even want to buy any real estate. This may not be a bad thing, since the convergence of these economic forces may cause more people to rent. And people who rent are able to be more mobile.

Myths and Tips on Lead Generation for Real Estate

Are you one of those real estate agents who are struggling to create leads? Have you ever imagined or do you understand the reality of quality lead generation for real estate? Do you know how to turn leads to potential clients? On this article, we will discuss the common myths about lead generation for real estate and we will provide some comprehensive tips to improve your strategies on lead generation for real estate.

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Imagine this, there are a lot of young professionals who just got a job in San Francisco area and of course, if they live far from San Francisco, their first thought would be moving somewhere near their workplace in San Francisco. These young professionals can be one of your leads. The first step they would take is by searching Google, using the search term, “San Francisco apartments” or “apartments in San Francisco”. They would check the first result they see and if they already like it, they will give that result a call. Imagine that opportunity given to you if you only knew the reality of lead generation for real estate. As a professional real estate agent, it is your goal to be on top of paid and organic search results.  You have a website that you use so people like them can find you and you may have been missing this great opportunity.

There are more pieces to the puzzle in earning your desired lead generation for real estate aside from being actively present online. Here are the common beliefs that most people know about lead generation for real estate and we have included some tips to reveal how to counter them.

It’s not difficult to reach the peak of the results. Everyone thinks that they will have their website already on top of the search engine results and it will help them with lead generation for real estate. You may have also heard that quality content, link building, and some fresh content will put you on top. Unfortunately, we have to be honest; it’s not easy as you think it is. Dominating the search results don't just happen because you have all of these.

TIP: You need to plan and use a comprehensive strategy to have the upper hand in the search engines. Start with keyword research then add fresh content to your website. These strategies are proven by the experts and it would give you your desired lead generation for real estate. Promote your content through social networks, PR, and email marketing and this will boost your lead generation for real estate better.

Lead generation outmaneuvers lead management is the most common disbelief amidst real estate agents or even not in the real estate industry, but many business owners who lack the knowledge and experience with using online marketing. For example, you get 500 leads but then only 10 converts, so when you sum it up there is only a 0.02% conversion rate which is not enough to sustain your business. The poor lead management system can be caused by the low conversion rates you have. This may waste all of your hard work and money spent on marketing.

TIP: You need to guide your visitor all throughout the whole conversion funnel. When you have visitors already visiting your site and you have already provided them with your contact details next step will be continuing the determination of converting that lead. You need to hustle because this lead may come off as cold as they could become hot at one point just by spending time and more effort to nurture them.

Visitors are all interested in you. Visitors would care a bit but not right away. Prospects for lead generation for real estate that came from the search engine and has visited your website would generally want what they like to see first or what they searched for. After skimming through your site, that is the time they will check your profile right.

TIP: You must not make your website generally about you. You can include your personal information on your website in the "About" section but do not ever clog your homepage with too much personal information or else your prospect on lead generation for real estate would leave right away.

The beliefs about lead generation can go on and on but our simple tips can help you go a long way. Lead generation for real estate needs more attention than you think it does. These can be ways for you to get more people or leads. You need to make a comprehensive step by step strategy in reaching the top page results and pay more attention because it takes a lot to reach the top.

Bay Area Homes - Should you sell or buy in the summertime?

What if I told you that the prices drop down by 0.2% according to the Oversight Index of the Federal Housing Enterprise. How is that possible? A quick look at bay area housing prices in the summer infers a price increase. What gives?

Its the Seasons!

One of the biggest reasons is because of the seasonal change. An effort to get out of the usual calendar pattern and get into the principal trend. Real estate prices in the bay area generally pitch by May, and after this surge of seasonal adjustment, the prices experience a fall.

The researchers, media, and reports show that the property price in the bay area seasonally adjusted makes little sense. They are better for the people who want to understand the whole situation as for why predictable seasonal twists get into play.

Someone in the bay area who is trying to sell or buy a property cannot ignore the seasonal convention gyrations. However, no one pays the price that is adjusted because of the seasonal change. If you have paid $1,000,000 on a house in the bay area in February, the expected price of the property may reach $1,150,000 if you wait until August. Whether it is a season or not; the $150,000 are your benefits.

However, this raises a huge question. If prices typically show a rise in summers and decline in winter especially in the bay area, United Kingdom, United States, France, and Belgium- then why people still choose to buy houses in the summers? Why don’t they buy a house in the bay area at the beginning of the year or wait until the surge is over and prices are stagnated?

Reasons to Move

There two are the main reasons why people move to a new house during the summer:

  • Generally, people feel that the summer season is the best time to purchase a property. It is the time when a family is preparing to drive their kids to a new bay area school, and it is also the wedding season. Besides, the house-hunting experience is better when there is the sunshine. However, these, of course, are not reasons to spend thousand dollars extra on the house.
  • Another reason why people choose to buy the house in summers is that the rent or mortgage finance are cheaper during that time.

What do the experts say?

A new research paper by Silvana Tenreyro and L. Rachel Ngai of the London Economics School provides us with a solid solution to this conundrum.

The paper starts with a remark that unlike, laptop, car; all houses are different from one another. A specific house may go perfectly with the need of the family. The process of figuring out that how a certain house suits your need is a time-consuming as well as costly business.

This means that if you are a bay area buyer, you may prefer house-hunting in wide markets when there are tons of houses for selling and chances are that a perfect fit might come quickly to them. There is no excitement in house-hunting when the market is down, and the chances of finding your ideal house seem minimum. House hunting in the cold bay area winter does not seem fun.

If Tenreyro and Ngai are correct, then the dynamic of housing market goes like this- A Buyer prefers buying housing when the market has good options to offer. Thus the sellers put up more market on the sell, and with a good number of sellers and buyers, the market becomes wide. This means that there is a better possibility that the buyers find the house that they are looking for and this makes them shed a few extra money out of their pockets. With high prices, sellers put more houses on the market during summers and fewer in the winters due to the stagnated price. This self-emphasizing process can create a huge gap between the prices during winter and summer. In the UK, there is a regulation in which only fewer houses are put up on the market, and thus the current store is predominantly characteristic which is the main reason why particular seasonality strongly influences the UK market rather than other places. 

So, if you want to get a bay area house at cheaper rates, then you should wait till the winter. However, keep in mind that a cheaper deal doesn’t mean that you are getting a better and a healthier deal. It's never black and white. That's why we recommend to always seek an expert real estate agent. 

Trust your Real Estate Agent

At Omni Real Estate, we follow all the Bay Area trends to know the best time to sell, buy or rent. We can use our background data and experience to make sure you get the best real estate deal possible (whether its buying or selling). 

 

6 Smart Ways to Get Going in Property Management

It is not a job for everyone, but with the rental market being what it is, becoming a landlord is one smart way to build wealth. 

The demand for rental units is continuing to remain strong. The failure of wages keeping up with the high cost of housing has a lot to do with this. Some point to the housing market collapse in 2007. Since then, rentals have risen steadily while homeownership has declined.

While home prices have rebounded in many parts of the United States, they are still only projected to go up about 3 percent for the year. This provides a clear picture of just how favorable investing in rental real estate is. 

At the same time, this does not mean that being a landlord is a way to get quick fast. Renting properties out is a long-term investment and it should be approached carefully. If you have already thought about it and are ready to become the next real estate rental mogul here are six smart ways to get you started.
 
1.  Realize that a landlord is a business professional.

Being a landlord means being in business for oneself. It is different than homeownership. You have to treat it like the profession it truly is. This means that whatever property you buy has to be a good business investment. It's best not to approach it like it is a house you want to live in.

The property has to appeal to the types of tenants you want to rent to. In addition, one big criteria is to be able to qualify for any loans on that property. This means having at least 20 percent of the down payment ready to go. If you have already purchased a rental, your income has to be sufficient to pay your own mortgage as well as the rentals.

2. Start out small.

One way to make sure you are cut out for this business is by starting off buying a single-family home or a small multiple-dwelling unit. Single-family residences are among the easiest investment properties to buy.

Condominiums require larger down payments as well as monthly association fees.

Starting small with a single family home gives you a feel for the maintenance, responsibilities, and bookkeeping required. Dion Cheng suggests that you buy a simple property at first – one that has simple, easy-to-maintain features.

3. Don't invest in a place you don't know.

In real estate it is all about "location, location, location," and nothing could be truer when it comes to rentals. A place might seem like a bargain if it is in a neighborhood most people would not want to live in.  Do not buy property out-of-state if you do not know the location. Stick to property locations you know well.

4. Determine the appropriate rent.

These sums differ throughout the United States. Get an idea of rent prices from Craigslist and real estate sites and agents when shopping around. Determine if the rent will cover your operating costs.
 
Many people think that if they can cover the loan they are fine. But, you also have to pay for taxes and insurance. You also have to cover any potential vacancies and maintenance or repairs. 

Forgetting to budget for repairs is a common problem. You need money on hand to deal with maintenance expenses. Things will break.

You also need to make sure that you understand the rate of return that you will get on your investment. You can use formulas such as the capitalization rate to help with figuring this out, but it also helps to get professional help. Speak with an accountant to be sure your purchase is lined up for success.

5. Be willing to start working on rolling up your sleeves.

You want to get your hands dirty by taking care of managing your first property yourself. This will help you get the idea of it and it can be done especially with a single-family home.

Are you good with tools? That is even better because you will save money on hiring electricians or plumbers whenever something minor needs to be repaired or replaced. If you have been putting off fixing a leaky faucet in your home you might want to rethink becoming a landlord.

Don't forget that you also need a thick skin. If the idea of calling a tenant to find out where the rent check is you might want to find other work -or at least hire a property management company.

6. Get professional help when needed.

Even if you have confidence in managing a property yourself, be sure to consult with a real estate attorney as needed. Get informed on the lease agreement standards and on the rights of your tenants. An accountant is helpful, too. Also, get a good line up of tradespeople like plumbers and electricians together for times when you need them.

At Omni Real Estate, we can help you with this entire process.  Our experience can help your first experience in property management a pleasant one.