“Supply and demand” isn’t just a topic for high school economics class, it has a direct impact on the real estate industry, and thus your day-to-day business. In this video, Benutech’s Tom Iovenitti provides an overview of how the current real estate marketplace is being influenced by supply and demand trends, and makes suggestions for how proactive agents can respond appropriately.
[expand title="Transcript" trigclass="RRTranscriptTrigger" targclass="RRTranscript"]Hello. I’m Tom Iovenitti with Benutech, Incorporated, makers of ReboCollaboration and ReboGateway tools. Bringing you ReboReports, high atop a cliffside home estate in Corona Del Mar, California, overlooking fantastic Newport Bay.
Today, I’m going to talk to you about some things that go on with supply and demand. Those of you that are in real estate kind of know the changing market conditions, understand what supply and demand means. Right now, as you all probably are fully aware, there’s a low supply of homes for the marketplace.
What we’re experiencing is, is buyers are out there in plethora looking for the fantastic deals that were four or five years ago, and they’re finding that prices are finally starting to increase. And they’re getting off the fence and they understand interest rates are starting to climb, and they’re going out there trying to buy something today.
Here’s some of the issues that happen. Whenever you’re dealing with a low supply and a high demand, you generally end up with multiple offers on a piece of property. Driving the prices a lot higher than what the listing price is. When that happens, everybody wants to know, what is the magic price? Nobody will know that unless you get the counteroffers and start to play the game and hedge up against whatever the counteroffer might be. Generally speaking, I would say that the market’s trend right now, because of the supply and demand issues, that you’re going to find a lot of cash buyers winning out on a lot of these transactions.
So my suggestion overall, because of the supply and demand issue, is: 1) When you have a buyer that’s going out there on the marketplace, the best thing that you can do, prior to even taking them out, is to have them qualified – not pre-qualified, but qualified. That means that all their documentation, subject to finding a property, has been completed through a lender of their choice. So I would highly suggest that if you’re dealing with buyers today to take the time and get them prequalified, not on the preapproval basis, but through all of the little idiocies that things come out of the mortgage industry. As you all well know, mortgages are very very difficult to get today. So the easier you can make it on yourself and your client, the better off your offer’s going to be. So again, this is Tom Iovenitti, from ReboReports, Benutech Incorporated. Thanks for listening.