Yell It from the Rooftops
While it should have been a front-page, headline-screaming report, a VERY interesting piece of information was buried several paragraphs deep into a Wall Street Journal story on the reasons the housing market isn’t doing a better job at boosting the U.S. economy. Buckle up, it’s a good one!
The percentage of homeowners who are underwater – that’s a figurative term, of course – is 8.7%. Not that anything other than 0% is ideal, but let me put that into perspective for you. According to CoreLogic, that statistic back in 2011 was 21%! You have to agree that’s pretty impressive by itself – but wait, there’s more!
The percentage of homeowners who BELIEVE they are underwater, according to data from Fannie Mae, is 27%. Yes, you read that correctly – 27%, as opposed to the 8.7% who are truly underwater. That means that for every three people who BELIEVE they’re underwater, only one of them is. Let’s expand that number: in a sample size of 100,000 homeowners, 27,000 of those homeowners believe that their homes aren’t worth what they owe; in reality, though, only 8,700 are really facing that struggle. This means you instantly have 18,300 people whom you can turn from “no, I can’t” to “YES, I can” in listing their house.
It’s highly likely that this perception is one of the chief reasons so few homes are actually on the market. According to the National Association of Realtors (you’ve heard of these cats, right?), inventories fell another 2% in October, and this remains well below historical levels when compared to the sales pace.
I’m just spitballing here, but wouldn’t it make sense to make a VERY BIG DEAL of this in your marketing? It could be something as simple as “Two out of every three people who believe they’re underwater in their home really aren’t – let’s talk!” Let’s be honest, the average homeowner, when it comes to the value of their home, relies on gossip and the flyer on the house two doors down. Do you want to rely on those two items as your “marketing team”?
Food for thought: In one of our past editions of this extraordinary oracle of lending lore – sorry, I got carried away there for a moment – we talked about properly reading an appraisal to assure you’re getting the most for your seller. That same expertise will arm you with the ability to BE THE EXPERT and convince a potential seller that they’re ready to put their house on the market NOW.