Greg: Welcome to this edition of the Greg Fly Podcast, my excuse for talking with people I find interesting, about subjects that I’m curious about. I’m Greg Fleischaker, your host, and today, once again, I’m joined by Jon Mand from Lenihan Sotheby’s International Realty, just because he’s a great resource, so I brought him back. Jon, how are you?
Jon: I’m glad to be back, Greg.
Greg: All right. I’m telling you, get used to it. A little while ago, we talked about getting ready to sell your house, and how far ahead of time it’s nice if a seller prepares, and if they don’t prepare, and all the stuff that goes into selling. Let’s flip it around a little bit, and talk about buying a house. As an agent, obviously we will take phone calls from somebody who says, “I want to buy a house today,” but ideally, if someone calls up and says, “I’m thinking about buying,” when does that call come, before they need to be in their new house?
Jon: Same answer as last one.
Greg: Oh, my gosh. Any question I ask you, it depends.
Jon: Exactly. The earlier, the better, and the reason is on this one, it’s just getting the buyers educated enough to build their confidence enough, that when the home comes along that’s right for them, hits the market, that they’re able to recognize it for what it is, and act on it quickly. You want to be out there, even before you’re ready. Particularly, look at them online. Use the emails from Greg’s website. Use Zillow, whatever it is. You want to look at these properties online, and just start getting a feel for pricing, and what to expect in your price range, and then go see them. You don’t have to go out and knock out 12 showings in a week, or in a day, sometimes we often do.
Greg: Is there a danger in that? This is an agent-by-agent … Some people say, “Get out there early. See what’s in the market.” Other people say, “If you go out, what happens if your buyer falls in love with the property, and they’re not ‘ready’?”
Jon: Sure. Depending on what’s causing them to not be ready, we can obviously come up with solutions. If we need to figure out an interim fix, or if it’s just timing. There’s any number of solutions, and it depends on how far out they are.
Greg: What does not ready mean, really.
Jon: Greg, I’ve sold homes to people a year before they even moved to Louisville. We figured out how to make that work.
Greg: I bought my house when I wasn’t ready. I wasn’t really looking, and yet, I was walking through houses, and I found the right one.
Jon: Yeah. I’ve sold homes for sellers that weren’t ready. They said on the front end, “We’re not moving out for a year.” I said, “Great.” We sold it, and they leased it back from the buyers for that period of time. There are ways to get creative, if the right house pops up. More importantly, it’s just getting comfortable with the market, setting your expectations on what you’re going to be able to get for the budget that you’ve identified for yourself. What I often see is that home buyers, we take them out, they’re ready. They haven’t really done a lot of the homework up front. They say, “I’m ready. We’re going to go out and start looking.”
We take them through a house, and it’s the perfect house for them, and they should buy it immediately, because it’s not going to last, and they don’t believe me, because they don’t have that frame of reference to understand why it’s such a great house. As agents, we’re in and out of these things all day, every day, so we can recognize it, but for the buyer, they just have to hit that learning curve as early as they can, so then when those things pop up, they say, “Oh, wow, this one’s going to go.” Sometimes it takes watching a house or two that they love, they see it, and they go, “That’s great. Let’s think about it,” and it sells that afternoon or the next day. That happens once or twice, and all of a sudden they realize, “Okay, I see what’s going on in the market here.”
Greg: I must say, we’re talking right now in a market that’s pretty tight. A lot of our clients are looking at price ranges that are tight, and areas that are tight. I’m hearing a lot of conversation around the office that is exactly what you’re saying. “My clients didn’t believe me that this was going to go quickly, and we’re going back, looking at homes, because it went quickly.” I’ve heard that, I don’t know how many times. Frequently. That’s important.
If you’re a buyer, and you want to give yourself a little time to look at the market, what are a few things you can do, or you should do, to make sure that you are as ready as you can be, without having seen the home? Calling a mortgage broker or banker, or trying to get an idea of what your current home might sell for, or if you have a home. There are a few things.
Jon: Yeah, definitely. As mentioned before, these are typically coupled transactions, where somebody buying, often has to sell a house, so let’s drill down and make sure that we know what your realistically going to net from that property. Let’s talk about what you need to do, to maximize the sale proceeds from your current house. Set an expectation for how long that’s going to take, talk to the banker. Get the pre-approval. Find out, “If a house comes up tomorrow, and we love it, can we offer on it? Can we do a bridge loan on our existing home? How can we, if we fell in love with something today, how can we, or can we make something happen quickly?”
Greg: You’re just game-planning different scenarios. “This could happen, this could happen, this could happen, and let’s make sure we’re ready for as much as possible. Surprises might still happen, but if you really want to move and buy, these are a few of the things you need to think about, before we really get too serious.”
Jon: Yeah, and then sign up for the auto emails through your website. Those are great, where people can start tracking all the new inventory that come on. They can see the photos. Even if they don’t go see them, just watch them online. Watch when that house pops up that you think, “Oh, man, that would be great. We’re not ready yet, but …” Just watch it, and see how long it takes to sell.
Greg: Yeah. Call us back in a week and go, “Is that still there?” “No.”
Jon: Exactly. It doesn’t have to be … It can be somewhat of a passive, just keeping your finger on the pulse of the market. As you get closer, that’s when you start going out, hit open houses with your agent, go out and do scheduled showings. Start seeing a couple houses here and there, on the A level, the highlights, and then obviously, once you’re fully ready, you go out and you see everything.
Greg: That’s right. That’s what you see on the TV shows, or in the movies, when you pack your lunch, and you go out and look at ten homes in a day, and you can’t tell them apart by the end of the day, but it’s fun. It’s interesting. Once again, I appreciate the insight. I got a couple more questions I want to ask you for different episodes, but I appreciate you letting me pick your brain a little bit.
Jon: All right. Not a problem. Any time, Greg.