What To Expect From First-Time Homebuyers

I am a realtor who decided to specialize with first-time home buyers. I based my book of business around this niche. I am also a first-time home buyer myself. I bought my first place this February and represented myself as an agent. I am going to give you a rundown of my experience with these types of buyers. If you are contemplating picking this niche as a real estate agent, you’ve landed on the right blog.

To begin, working with people who have zero experience in this process requires patience and communication. It's not for everyone. It takes time to educate your client, get them up to speed on what they should expect, and what steps they need to take. It's also a very rewarding path because you get to see the excitement of something and the sense of accomplishment that they feel.

When I meet a client, I tell them to work on these things:

Start saving for your down payment.
Begin working on your credit.
Find a loan officer who you trust, begin building a relationship and filling out a loan application.
Find a real estate agent.

Therefore, you as an agent should have a list of a few loan officers who you know are patient and don't mind educating the client on the loan side of the process. Some people will not get along, so you should have more than one officer to recommend. Also, know what programs are being offered and how certain programs benefit each client. Thus, you can easily match certain programs with a potential buyer.

Once your buyer is pre-approved, you should begin talking about their price point. Spending the max amount they were pre-approved for is not always their best bet. Advise your client to begin creating a budget and work with their loan officer to devise the inputs for their monthly mortgage payment. That way they know what's comfortable for them and what price point is going to be best.

As their agent, you should also educate your client on the market and how it is performing.

If it is an aggressive seller's market, like it is now (February 2021), then explain what that means for them as a buyer. Explain these basic terms and how they affect their purchase:

Seller's market: an economic situation in which goods are scarce and sellers can keep prices high.
Buyer's market: A buyer's market takes place when the amount of available homes for sale exceeds the number of buyers wanting to purchase a home.
Multiple offer situation: when one house has multiple purchase offers submitted at once.
Closing costs: are the expenses beyond the property cost that buyers and sellers incur to finalize a real estate transaction.
Inspections contingency: gives the buyer the right to have the home inspected within a specified time, such as five to seven days. It protects the buyer, who can cancel the contract or negotiate repairs based on the findings of a professional home inspector.

These terms will help your client feel more prepared when you are writing the contract and submitting your offer. You want there to be no

surprises and they should know how each clause affects them.

The next thing you want to do is ensure that they are not making any basic first-time homebuyer mistakes like:

Looking at many houses that above or far below your price point
Not checking and correcting their credit reports
Making a down payment that's too small and not having optimal monthly payments
Not looking for first-time homebuyer programs
Emptying a savings account
Shopping for a house before shopping for a mortgage

You can save your clients from making these mistakes by having open and honest conversations about the costs of buying a home. Make sure they know they have a real estate agent they can depend on to know the neighborhood's property taxes and estimated seller's utility bills.

While not everyone is willing to work with this real estate niche, it can be rewarding and exciting. Try new things and see what works for you and, as always, check back with the Career Corner for more updates on how to get your career on track!

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