By now, you’ve probably heard a bunch of predictions for the 2022 housing market, but a question burning in many real estate professionals’ minds is: what is going to help you win this year?
Buffini & Company founder & chairman, Brian Buffini, had a few thoughts on the matter when he joined RISMedia president, founder and CEO, John Featherston, to discuss what real estate professionals need to focus on to succeed in this year’s housing market.
The one-on-one break-out session, which Featherston moderated, was held during RISMedia’s Real Estate’s Rocking in the New Year virtual event earlier this month.
Featherston started the conversation by asking Buffini to delve into the most valuable lessons real estate professionals learned about buyers and sellers in 2021 that will impact business this year.
“We learned a lot this last year,” Buffini responded, indicating that many trends from 2021 will likely continue this year for at least the first half of 2022.
“The way I would view it as this is the end of the tube of toothpaste of this raging hot market, and you want to have a rocking new year,” Buffini continued. “It’s going to be a rocking real estate market for the first six months, and then we are going to start to see some adjustments.”
The pool of first-time buyers has grown slightly in the past year as did interest in a multi-generational home. Buffini expects to continue and increase this year as persisting inventory shortages continue to contribute to shifts in the market.
Strong demand and lagging supply have also affected the duration listings are on the market.
“The typical buyer looked for eight weeks at eight homes compared to 12 weeks for 12 homes a year ago,” Buffini said, adding that agents could use the data point to help set expectations with their clients this year.
“A buyer—when they start looking—thinks they’re going to look at 300 homes, and you have to let them know ‘this is not going to happen to you. It typically takes about eight weeks, and we are going to look at eight homes that are in the price range that you like,’” Buffini continued.
“I just think that when people know that’s what is typical…they don’t feel pressured to buy a home,” Buffini said.
Buffini also indicated that most consumers (90%) said they would recommend their agent after their transaction. However, only 28% of consumers said they could remember their agent’s name a year later, which Buffini used to drive home the importance of keeping in touch with past clients even after you’ve completed a sale with them.
“You’re not just missing out on repeat business; you’re missing out on all those referrals,” Buffini said. “We saw another stat that said that the average consumer a year after when an agent stays in contact will refer four times a year, so the payoff is enormous.”
Featherston then pivoted the discussion, asking Buffini to talk about the current state of inflation and its implications in the real estate industry in the forest half of the year.
“This is very high inflation that we’re dealing with,” Buffini responded while also critiquing claims from the federal officials that elevated inflation is transitory.
“Inflation is going to continue to be with us,” he continued. “Housing is going to continue to be in demand because housing is one of the most perfect assets to protect against inflation.”
However, Buffini stated that first-time buyers would likely be hit hardest by high inflation, straining their purchasing power in the market.
“First-time buyers are going to get a little squeezed,” he said. “That will squeeze the move-up buyers, so I think we are going to have a raging start in the first six months of the year, and then I believe it’s going to start tightening up a bit.”
“What type of advice do you give all of your customers as far as how to excel and how to excel in the next six months and improve their returns as far as the various diverse marketplaces,” Featherston asked.
Buffini advised agents to reconnect with any clients they sold a house to more than a year ago and provide a quick one-page comparison market analysis (CMA) to show them how much equity they made since they bought the house.
“You’ll be surprised how many people will engage you in that conversation,” Buffini said. “You get to be the hero, and some of them may be thinking of moving up. Some may be thinking of using that equity and investing it in a new home. Or a lot of them are going to be predisposed to give you a referral.”
Buffini also encourages viewers to take some time for themselves.
“You need to take little breaks during your week,” he said. “What I’m seeing is that people have worked hard. They know the market is going to be hot. They know the speed of the market, and they have to be around for multiple offers, but you should take little breaks in your day and week and little breaks like staycations and vacations. These next six months, here’s what should happen, you should have high performance in production and high performance personally.”
Missed the event? Replays, including every panel and expert interview, are available here.
Jordan Grice is RISMedia’s associate online editor. Email him your real estate news ideas to email@example.com.