For years, we’ve helped home buyers and sellers all over the country.
Look, we love you, which is why we’re writing this.
The truth hurts sometimes but it’s always better to live in the real world. We mess up too. We try to learn from our mistakes and help others not make the same ones we’ve made.
Look, home sellers, many of you are messing up. Homebuyers, you too.
When are yall finally going to get serious?
Some people get it. A single mom closed on a home in Minneapolis. A gentleman closed on a $1.6MM home in Asheville. A 22 year old closed on a home in Cincinnati.
What frustrates us is that day in, day out, we see so many other people making the same mistakes over, and over, and over again. Aaarghhh!
Sigh. Ok, let’s take this one step at a time.
Message to Home Sellers: Get Out of Your Feelings
Homeowners, you’ve achieved the American dream. The value of your home is up 30% in 3 years and you have a 3% interest rate. That’s actually insane.
Now, life happens and if you need to sell, of course you should. Nobody should feel trapped in their own home. But do it for the right reasons, not because you think you can buy and sell homes like they’re stocks.
Sell for the right reasons. Because your family has grown and you need more space. Sell because the kids are out of the house and you need to move on. Sell due to the unfortunate passing of a loved one etc…
Let’s step back for a moment and look at the big picture.
In many parts of the country, there’s still a big difference between supply and demand when comparing pre-pandemic levels to June 2024 levels, especially if you’re in the midwest or Northeast.
It’s much harder to build new construction homes in cities like Philly, NYC, DC, or Chicago (still down 67% in Illinois!)
There’s just not enough vacant land to build in many of these areas. Therefore, most of the home sales are re-sales of existing homes, not new construction homes. Inventory for sale is still way down.
But this isn’t true in the South. Things are almost back to a normal and balanced market in many parts of the South and Southwest – like in some cities in Texas, Tennessee, Florida and Arizona.
Active home sale inventory grew 71% in the state of Florida from June 2023 to June 2024!
Now, can you guess where the largest percentage of Black people live? Yep, in the South.
In other words, the areas where home supply is growing the most, aka where new homes are being built, is where many of us live.
Now do you understand why we’re shouting from the mountaintops?
New Home Sales Competition
New construction now makes up 30% of total inventory, about twice its historical share, according to the NAHB.
Everyone always complains about professional investors buying up homes. Well now, you’re competing even more than usual with professional homebuilders selling their homes. And they know what they’re doing!
They’re not chasing some pie in the sky number that has no basis in reality. Moreover, they’re making it easier to buy a brand new home:
- They’re offering lower interest rates in the form of rate buy downs
- Closing cost assistance
- Fancy custom add-ons
- Bonuses for realtors etc…
This is what an actual motivated seller looks like. Pay attention. If you don’t, you’ll see your home languish on the market for months.
We’ve had homeowners in our network go against the advice of their real estate agents and slap wildly inflated price tags on their homes. We’re talking about well-advertised, beautifully staged homes that are sitting on the market for 70 days, 100 days, 140 days.
This is all because even the best marketed properties can’t sell in this financial landscape if the price is not right.
These home sellers think there is some buyer out there who is going to come in and buy their overpriced home. It’s not going to happen. You have an emotional attachment to your home, but potential homebuyers do not.
You can’t tack on a few thousand dollars because your son took his first steps in the living room, but that kitchen remodel you did last year might help prospective buyers envision themselves there creating their own family memories.
Stop. Overpricing. Your Homes.
Listen to your realtor. You don’t pretend to know better than the mechanic when he recommends a repair for your car. You don’t fight the plumber, your accountant, your lawyer, your dentist, etc. You get the point.
The realtors in the Black Real Estate Agents network are industry professionals who know what they’re doing. That’s why we chose them and that’s why you hired them
When it comes to getting your home sold, take out the emotion and trust the professionals. There are numerous recent examples in our network of homes that were under contract in less than a week because they were priced correctly from the start.
This isn’t 2021 when interest rates were 3% and home supply was virtually non existent. That ship sailed a long time ago.
Interest rates have doubled and the competition is getting more intense with each passing day.
In short, there’s an old saying in business: Pigs get fat. Hogs get slaughtered.
Message to HomeBuyers: For Goodness Sake, Get Your Pre-Approval
How long are you going to keep complaining about the cost of buying a home? It’s been years and you’re still at it. Yeah, it sucks, but ok, let’s get going already.
Now, if you can’t afford to do so, then that’s certainly understandable. Keep grinding, keep saving, you got this! But if you can, and you’re trying to time the market? Stop it.
Why didn’t you buy when rates were 3%? Why didn’t you buy when we saw price corrections in dozens of cities in late 2022? Why aren’t you buying now?
- Is it too expensive in DC? Move to PG county.
- Too expensive in Chicago? Move to Aurora, IL
- Too expensive in Bedstuy, Brooklyn? Move to East New York.
Want to stay closer to the big city? Ok, keep grinding. It’s not fair that a brownstone costs $2MM in Harlem but that’s reality.
There’s no Ozempic for being financially fit. You have to work for it. Millions of people have done it, so can you.
By the way, this message is just to the potential homebuyers who are serious.
80% of people who contact us say they want to buy a home. Fantastic! Let’s get to work future homeowner 🙂
- Us: Have you been-pre approved for a home loan?
- Them: No
- Us: No problem, we have a directory of awesome black mortgage lenders who would love to work with you to help. Let’s get started.
- Them (90% of the time): Crickets. No communication. Nothing. Nada. They’re gone.
It’s as if some people like the idea of being a homeowner, but don’t want to put in the time and effort required to actually do so.
Realtors get all the glitz and glamour, but the home buying process starts and ends with the mortgage lender. A realtor cannot do their job without a lender.
Nobody likes having their finances examined, or going to the dentist, doctor, or doing their taxes, but you do it anyway, because you’re an adult.
How many social media posts, videos, and articles can we write about the home buying process? The information is there. When will you choose to apply it?
The good news is that you have plenty of time to do so. The median age of a homeowner is at an all time high – it’s 49.
Social media would have you thinking there are millions of 25 year olds out there buying homes. Don’t believe the hype. Stay financially disciplined and maintain focus.
Single women made up almost 20% of homeowners in 2023, while single men made up 10%. We can all do it if we apply ourselves.
It’s no secret younger generations have had it rough. Your grandparents probably bought their home with a bushel of apples and today’s interest rates ain’t like your parents, but homeownership is attainable for you! You just have to educate yourself and put in the work.
Come holler at us when you have that pre-approved loan locked in. Need help getting approved? Let us know.
Ok. We’ve said enough. Our rant is over. We’re done for now. We just have one more question:
When are you finally going to get serious?
Gideon is a licensed real estate agent. He he holds an undergraduate degree from Northwestern University and an MBA from New York University.
He’s passionate about business, real estate, digital marketing and making sure that black people increase our collective net worth.
License #:10401336627