April 18, 2024
Real Estate

Tips For Advising Clients In The Current Real Estate Market

A new job, a growing family, divorce, ailing parents, etc. There are many reasons for people to shop in today’s real estate market. So for the financial advisors and mortgage planning specialists guiding buyers through the process, it’s important to focus on what’s best for each client, rather than the market and economy.

Financial advisors and mortgage planning specialists are tasked with helping clients navigate the market, past the uncertainty and fear. Together, these professionals can find ways to create personalized plans for each buyer. Financial advisors help clients manage the asset side of balance sheets and can address tax implications, while mortgage planning specialists help clients manage the liabilities side and lay out various tactics to structure the loan.

If you’re a financial advisor or mortgage planning specialist, these tips can help facilitate your conversations with clients as you help them prepare for buying a house:

Focus On Buyer Readiness, Not Market Timing

Experts and buyers alike try to time the market, but if the buyer is financially prepared, the best time to buy a house is when your client is ready. In other words, their current level of dissatisfaction is high because the job they want is too far to drive, the current rent is too expensive, their family has outgrown the house or the neighborhood is no longer safe.

Consider Short-Term And Long-Term Implications

Show them the potential long-term benefits and implications of buying real estate but keep the short-term in mind. Help them create a detailed budget and determine their maximum monthly payment. Project out the appreciation of their investment over time to illustrate the potential benefits.

Help Them Create A Plan To Save For A Down Payment

You can suggest clients set up a system to save for a down payment that doesn’t require them to think about it. Like retirement contributions, buyers can make automated monthly deposits into a dedicated savings account. They should have a target number in mind to set a smart monthly deposit amount.

Help Them Establish A Debt Payment Plan

Take an inventory of the client’s debt, list those in order of smallest to largest, then advise them to start paying them off one by one to improve their debt-to-cash ratio.

Keep Tabs On The Market

Leverage technology to stay updated on the market, how it affects each client’s real estate plans and the appreciation of current assets. Home finance and asset management platforms make it easy to check in, and your team can provide monthly market reports to consistently stay in touch. Essentially, give your clients the tools to understand and make decisions about their investments.

Personalize The Experience

If you go the tech and automation route, don’t lose the personal touch. Clients appreciate a personalized experience because they want to know they are more than just a transaction. Calling them at least once a month allows both of you to tweak the home-buying strategy.

Guide Clients Through Their Plan

When financial advisors and mortgage planning specialists meet with clients together, they can review the entire plan, receive real-time feedback and answer questions. Your agenda may include strategies for leveraging equity, restructuring debt and reviewing tax implications and government programs that lower interest rates or tax implications.

Leverage Your Network Of Agents

Activate the real estate agents in your network. If your clients are window shopping for homes online, they may be unable to find their target property because sellers are hesitant to list. However, experienced and well-connected agents may be able to present coming soon and off-market properties.

Care After Closing

Design a post-closing plan so you and the new homeowner can manage their asset through the current market and beyond. Offering annual financial reviews and monitoring potential cost-saving strategies improves your clients’ experience and gives you a chance to stay in touch with their short- and long-term plans.

Buying in this market does not make sense for everyone. But for your clients who are ready to buy, advising them on up-to-date economic data, budgeting strategies, holistic mortgage strategies and competitive loan terms are some ways you can help them navigate the process despite challenging market conditions.

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