In this ultra-hot housing market, buyers are often being rejected. Worse, some buyers I’ve talked with have offered on multiple properties, with no luck on any.
There are many reasons for this, but according to statistics from the National Association of Realtors, year-to-date only about 20% of offers are being accepted; 80% are rejected. Some people are under the impression that cash-buying investors are the reason. Others think out-of-state buyers must be the culprit. And others don’t know who to blame. In truth, there are several important factors at play, most exacerbated by the hottest real estate market in a generation.
Justin Miller
While I don’t want to blame buyers, in truth, most are not thoroughly prepared. Buying a home is a competitive process, and to compete successfully requires pre-work. But rather than spending more time preparing to succeed in this market, many potential buyers keep making the same mistakes and the same excuses, over and over until they give up.
So how can one successfully move forward in an ultra-hot real estate market? It’s easiest to start with a few fundamental principles.
First: You need to focus on your goal, not the problem. There are many reasons one may want to buy a home, and your motivations are unique to you. But those motivations only give you the reasons to pursue your goal. Homebuying is not simple. There are many complex challenges that arise throughout the process. Focusing on the end goal is likely to keep you motivated along the entire path to homeownership. But remember, the goal only starts your process.
Second: Recognize there are other people who know more than you do—find them and listen to them. They are the key to getting through the process and to your goal. Regardless of how experienced you are as a negotiator, or how many homes you’ve previously purchased, today’s real estate market is difficult, with historically low inventory and record levels of demand. People experienced in this specific market have a significant advantage. They’re out there every day, looking at properties, meeting with buyers and sellers, talking with other agents and negotiating transactions.
Find the best agent you can, because you need a cohesive team of experts helping you. You should probably interview a couple of agents (remember, pre-work is critical). Not all agents are created equal. Some have specialized skills, knowledge or experience. You also want to have chemistry between you and your agent. Find a successful agent you feel comfortable with and are willing to listen to, and then commit to moving forward together.
Remember, you control your strategy (type of house, budget, location), but your professional adviser knows the tactics required to accomplish your goal. If you’re not willing to follow the tactical advice, you will not succeed.
Third: Stop listening to the wrong people. There are analysts, forecasters, media personalities and any number of other so-called influencers pushing informational garbage at you—all day, every day. These people specialize in nothing more than being listened to, even though they have little interesting to say and even less reason to be saying it.
Unlike housing, there is an infinite supply of informational garbage. And while it’s admirable to want to understand and learn, diving head-first into the garbage is likely to result in severe injury, as opposed to enlightenment. Talk to your agent—an actual market participant who experiences the real estate market daily.
Not all experienced real estate agents will agree with one another. We each may focus on a broader or narrower array of issues, on generalizations or specifics, on trends or the factors driving the trends. But the knowledge will be based in the real world and allows for effective interaction and successful engagement. Get your agent’s advice on the features and contours of the market and how to successfully engage with it. Rely on their informed insights.
Fourth: Get ready to move. Don’t get distracted by garbage, don’t second-guess the professional you hired. By focusing on the goal, searching for and hiring the best adviser you can, and by staying in contact with and following the advice of your adviser, you will find your offers taken seriously. Ask questions, share your information quickly and honestly and do the work your adviser tells you to do. Then, start packing.
In the end, this might sound like one agent suggesting the key to a new home is most likely to be found in the hands of a real estate professional. In some manner it is. But I’m really suggesting that you find the best real estate professional you can, commit to working with and following the advice of that agent and ignore garbage information by focusing on your goal. This is always important, but even more so when amateurs are being overrun in an ultra-hot market. If you fail to rely on the people who are activity working this market, you’re leaving a vital member off your team—one another buyer will use to beat you, consistently.
Justin Miller is a Las Vegas-based real estate expert and principal co-founder of the Chong Miller Group.
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