The chart below from www.HousingWire.com illustrates some of the emotional and financial reasons that are holding consumers back from buying real estate. One thing we can do to help stimulate our real estate economy is to educate consumers about the benefits of home ownership.
If you look at the chart, there are a few groups we can help immediately. The number two reason that people are not buying property is because credit issues are preventing them from obtaining a mortgage. With support and education our consumers can dramatically increase their credit scores over time. Finding these consumers and helping them improve their credit is one way to bring more qualified buyers into the real estate market.
In many markets, renting is more costly than buying a home. This is another area where education can illustrate the benefits of home ownership in terms of monthly costs, housing stability and potential equity growth. In today’s market, buying can have HUGE value over renting – including having a lower monthly payment.
Another common theme is our consumer’s concern about upkeep of a home. Condominium ownership offers the ability to own while upkeep and maintenance is managed by the condo association in most situations. This is another area where we can do a better job of keeping the consumer informed of their buying options.
In a struggling economy, a home or condo can be a ball and chain around job market flexibility. Many people have found themselves unemployed and unable to move to locations with more job opportunity because they could not sell their home or rent it at a high enough rate to cover their expenses.
Financial Barriers are Most Common Reasons for Always renting
Times Have Changed!
Are there homeowners who mistakenly believe that their house is ‘underwater’ but it is not? Are there current homeowners who could rent their current property at a profit and move up or away? It is our job to find these homeowners and offer the professional solutions they need to take the next steps in their lives.
In real estate sales and finance, we have a vital professional role as financial educators with a specific expertise in these areas. The average consumer probably does not look at a real estate agent as a member of their financial planning team, but if nothing else, hopefully we have learned over the past years that homeownership done right can be a key element to financial success and stability. However, if this is done incorrectly, this can be crippling… We have an obligation to our clients to be sure that we are presenting holistic financial options that look at their entire profile, wishes, expectations and dreams before engaging them in the home buying and financing process.