National Economy Versus Personal Economy

Buying a home in today’s market could be one of the best financial decisions you make.

At our office meeting this week, my Managing Broker, Casey McGrath brought up an article about how a broker in San Jose, Lisa Blaylock, had an appealing philosophy that got her clients to look at the market with a new set of lenses  – and ultimately got fence-sitters to hop off that very crowded fence.

We agents in the field have all worked with buyers this year (and last) who have look and looked, weighed, wondered and worried – but have not put pen to paper.  And, of course the national economy and the news feed their fears about buying or even entering the market as sellers.

After walking the walk with many a buyer and listening to them fret about the state of the economy, Blaylock, in San Jose, turned to her buyers and challenged,

“Ok, yes the national economy is fragile right now and it is important to pay attention to that, but how is your own personal economy?”

Blaylock began the dialogue with her clients that helped them see that the state of the national economy was not nearly as important as their personal circumstances.  She asked them questions like, how is the stability of your job?  How much equity might you have in your house? Do you want to move-up to larger home?  Through her conversations and investigations Blaylock found that the vast majority of her buyer clients had stable jobs with good incomes and savings in the bank.  She also found that many of her sellers actually had a good amount of equity in their homes too.

A Nexus of Good Things

Looking then at the national economy coupled with personal circumstances, she and many of her clients together came to the conclusion that now may actually be the best time for them to make a move. With interest rates at a record low and a healthy amount of inventory, move up buyers, for example, could price their current home aggressively and take advantage of today’s market to find their dream home.  Down-sizers can also benefit from getting a great value and interest rate on their new purchase.

We all know folks out there who are struggling

But, we also know folks out there who are thriving. One of my friends is an Acupuncturist, all-in-all a small business owner, yet her practice has not skipped a beat in the past three years.  Another friend of mine is a firefighter in CA.  The hiring freeze on firefighters led to a boom in overtime for current firefighters during the fire season – they paid cash for a new built-in pool.  And even in the challenging world of real estate, some savvy agents are having record years.

Don’t Put Your Dreams on Hold

I have seen many families put their goals, hopes and dreams on hold out of fear.  If  buyers and sellers reluctant to enter the market do a little self-assessment, they may very well find that they can and should move across the country to be closer to granchildren or family.  They can sell their current home they’ve outgrown and get the large home they’ve been needing, or they can sell the big home they no longer need as an empty-nester and buy the waterfront condo they’ve had their eye on.  The national economy will likely take years to straighten out – I think it is a good idea for those who can to not to put their your goals on hold for that resolution.

So we all need to remind ourselves to look around and pay attention, but remember to stand back and take stock of what is going on at home.  If folks pay attention to their goals the “personal economy” may be the very best indicator one has when making the decision to enter today’s real estate market.