Home Builders and YOU: Bring Back the Excitement!
The Commerce department reported today (http://tinyurl.com/4s9wt3j) that new home sales fell over 16% last month and the median new homes sales price was the lowest since December of 2003. Not only did sales and prices drop, but the forecast for new home sales units for 2011 is a paltry 250,000 units, which is the lowest since 1963. You may think I am crazy to even mention new homes in a blog with a dire report like that, but I want you to think about it. Read on!
This is a grand time to get involved in new homes because builders are hurting. They need salespeople more than ever, and we need them to build homes we can sell. It’s the perfect match! We went through a really tough real estate market in the 1980’s, and the thing that saved many of us was new home sales. Again, the builders needed us, and we needed the builders. The hot models in those years were two story homes with an unfinished second story. You could get what looked like a mansion for a bungalow price. We sold them as fast, and we had plenty of lots to build them on just like we have now. We saved a lot of builders, and they saved a lot of REALTORS®.
We have a different set of circumstances today, but there is no shortage of opportunities. The only way any of us will get out of this mess is to sell our way out of it, and we can. One of the best opportunities we have is to match the largest buyer segment ever – first-time homebuyers, who represent 50% of all buyers – with the builders who can build exactly what they want. This buyer group loves NEW HOMES much better than resales or distressed properties, and due to the drop in prices for homesites (building lots) they can buy new homes in some areas for resale prices or even less. On top of that, these buyers are easy to find, in that most of them live in apartments or a rental house. Many of these new apartments have the very latest in equipment and amenities including granite counter tops, hardwood floors, and energy-saving appliances at affordable prices. Thus, for many first timers, new homes are at the top of their list. The perfect fit for this market.
Buying a new home or a new car should be exciting, and that is exactly what we need in real estate, a return of the excitement. The idea of stimulating sales with signs and open houses just does not do it any more. Last week our nearby Walmart brought in a local General Motors dealer and had a new car show in the parking lot. There were people, cars and lots of traffic. I promise you that those cars generated more excitement in that parking lot than they would have on the dealer’s lot, and it created an atmosphere of excitement that will certainly lead to more sales.
So why not have a New Homes event for first-time homebuyers? For a small builder, this could be done one house at a time. You do not need a builder to build 10 homes, just one small builder with a great building lot, a modern house plan, and a creative mind to make it happen. This could be done with one furnished model with “Rooms to Go Furniture” that visitors could actually buy (furniture stores would love the opportunity). There could be mortgage people who could do pre-approval, local nurseries could have a plant show, and each of your guest vendors could have mini-seminars. You could even include a petting zoo for children of all ages, everyone could get a free apple pie, and you can hold a drawing for special prizes. WHY NOT?
My concern with this market is that it dampens creativity and we fall into a game of “watching and waiting.” Real estate for REALTORS® is a VERB, so why not have a sales event and get everyone involved? We have a wonderful opportunity for salespeople and companies to increase their market share and profitability by stepping up and creating some excitement with the builders who, like us, need more sales. There is nothing more exciting in New Homes than a new house plan with new products, a new floor plan, new front elevations and more GREEN. There is no evidence that doing less creates more, so it is time for all of us to do more, get more and to create a positive sales atmosphere!