Over 88 years ago, on April 18, 1930 for the 8:45 p.m. news broadcast, the BBC’s news reader came on the radio and had nothing to communicate. He had been handed a script that he was to read – “There is no news” – so he read exactly that. Following those four brief words, piano music was played for the rest of the 15-minute segment before returning to broadcasting from Queen’s Hall in Langham Place, London, where the Wagner opera Parsifal was being performed. Simpler times!
Whether you view it like the kid who learned how to make crude sounds with his hand and armpit that you found funny in third grade for three or four days before it got old or like the latest flu that will pass in less than a week, the news comes in cycles that burn out after a while and we turn our attention to something else. One of those news cycles near and dear to our hearts in the real estate/mortgage world, of course, concerns millennials and why they’re holding off on buying their first homes. I realize that news cycle has run its course, and it was more than a few cycles back, but this is my newsletter, so I’ve decided to bring it back. Humor me. I promise it’ll be better than armpit sounds and far easier to take than a flu.
After a lot of virtual and literal hand wringing, the pundits told us that there were many reasons millennials were holding off on making their first home purchase. One of the chart toppers was student loan debt. Another one that ranked right up there with student loan debt was an unsure job market. Without a doubt, those are two major considerations/reasons that will affect ANY home purchase, especially a first one, so please don’t think I’m making fun of them, because I’m not. My particular favorite, though, is sort of a catch-all reason that is both declarative and ethereal at the same time: the Baby Boomers ruined the economy! Now, with this one, I am gonna make a little fun of it – just a little. Using “the Baby Boomers ruined the economy” as the reason for not buying a home is like Jerry Jones, owner of the Dallas Cowboys, saying ticket sales have fallen because the paper companies are gouging him on paper prices. In other words, it’s a general answer that doesn’t REALLY answer the question.
As that particular news cycle about millennials and home sales began to burn out, nothing too definitive was ever revealed –much like most episodes of the evening news – so our attention was drawn elsewhere. When this happened, the smarter agents and mortgage professionals put some lotion on their hands (for the wringing, not the armpit thing) and decided to focus on other ways to find prospective home buyers. One of the most effective focuses I’ve seen lately is down-payment-assistance programs. Hear me out!
Yes, past issues of this newsletter have centered around the reasons DPA programs aren’t the best thing for your clients, and all of those reasons still hold true. The reason, though, that I say it’s been wise for agents/LOs to focus on DPA programs is that they catch buyers’ attention. This is sort of like the weight-loss commercials that show an obese man with a 28” neck and a 48” waist in the before picture and the same man with a 28” waist and a 48” chest in the after picture with tiny writing that reads “results not typical”. No, I’m not suggesting a bait-and-switch scenario. I’m merely saying that talking about a DPA program gets the phone ringing because it causes people to wonder if a DPA program is right for them. Once the agents and LOs can get the people reaching out to them, they can start a conversation and get them what they REALLY need. Such an approach makes far more sense than waiting around to learn why someone is waiting around, wouldn’t you agree?