Boomerang Buyers Making a Comeback

By Julie McCoy

 

About 7.2 million people lost their homes due to a foreclosure or a short sale in the last recession, according to Irvine-based RealtyTrac. The good news is that this year and in the years to come, many of these people are getting back into the housing market again.

More than half a million  “boomerang buyers” re-entered the housing market last year and this year that number is expected to jump to a little more than 1 million, RealtyTrac predicts. “This is kind of a year where they really start coming out of the woodwork,” said RealtyTrac Vice President Daren Blomquist.

In the next couple of years, by 2018, the number of boomerang buyers getting back into the housing market is expected to go up to more than 1.3 million.boomerang

Using foreclosure, affordability, and demographic data,  RealtyTrac predicts nearly 3.5 million Americans will become eligible to buy a home over the next three years.

“Realize you’re going to be getting a lot more interest from these folks,” Blomquist said. “Don’t discount these boomerang buyers and say, ‘I don’t want to deal with these buyers.’ This is going to be a growing part of the market for the next several years.”
The term boomerang buyers is a good name for them because they’re rebounding and coming back, just like a boomerang does when you throw it.

In some ways, boomerang buyers are similar to first-time buyers in that they don’t have a lot of money for down payment. But they also are different from first-time buyers in that they have been home owners before, Blomquist pointed out.

“They are not going into this totally blind,” he said. “They have actually learned about home ownership [unfortunately] the hard way. You’re not having to educate these folks completely on what home ownership is all about.”

Before you go too far down the path of looking for homes with boomerang buyers, make sure their history has been repaired, Blomquist advises. “That may take some time,” he said. “Coordinate with your mortgage broker to educate yourself as to what are the guidelines for FHA loans and Fannie/Freddie loans. Talk to the mortgage broker you use and get a template from them as to the time frame for boomerang buyers.”

Homeowners who hb2ap3_thumbnail_unnamed_20160715-001420_1ave gone through a foreclosure have to wait seven years to get it off their credit history and it typically takes three years (sometimes more, sometimes less) before they can get an FHA loan. Now that it’s been nine years since the recession started, many homeowners who experienced a foreclosure when it first began have passed the mandatory waiting periods. They have used the time to repair their credit and are now in a position to be able to buy again.

You as a REALTOR® need to become an advocate for boomerang buyers, Blomquist stressed. “The process of re-qualifying can be painful,” he said. “They are having to drudge up the bad stuff that happened seven years ago. That’s painful to relive that. You should be their advocate in helping them tell the story of why they were the victims, assuming they were. I think a lot of people were. You are the advocate and the buffer between them and the lender as they go through this somewhat painful process of re-qualifying,”

Don Jessup of Silicon Valley Associates worked with several boomerang buyers last year.

“I am sure we could have worked with a lot more of these people,” he said. “They have the ability to pay again. A lot of people are still trying hard to re-enter the market.”

While Jessup isn’t currently working with any boomerang buyers, he said he would be happy to start working with them again.

“I am not personally actively searching them,” he said. “It’s a good market. The problem is how do you find them. I think you could run ads saying, ‘Lost your home in 2007 or 2008? Now is the time to get back in the market.’ Offer credit seminars to people who have lost their homes.”

It’s really important to be sensitive when you’re working with boomerang buyers and to not be condescending or judgmental, Jessup emphasized. “Empathy is a good thing,” he said. “It has got to be running
through their mind, ‘What if I made a bad decision this time?'”

The reward of working with boomerang buyers is you’re helping people get their life back, Jessup noted. “There is a sense of accomplishment in getting a piece of their life back that they lost,” he explained. “It adds a sense of security in their lives when they get back to being a home owner.”

The challenge of working with boomerang buyers is that you have to be more aware of credit issues and pair them with a good lender who understands boomerang buyers and get them through the pre-approval process, Jessup explained.
Younger Baby Boomers and older Millennials are more interested in re-entering the market than older Boomers because they have more time to pay off a new home, he pointed out.

Recruiting and Retaining The Right Way

By Jim Myrick, Keller Williams

interview-1018333__180Have you ever heard the saying, “If you want to know the person’s character, look at his friends?”

The same holds true for Managing Brokers.  The agents in their office say a lot about the values and success of their business.

Are you being deliberate about who you are trying to recruit and retain? When it comes to agents,  talent attracts talent and non-talent does the same.  What also holds true is that non-talent repels talent.

Is your brokerage business set up to attract the best in the business or are you creating a group for the Island of Misfit Toys?

I think one of the big mistakes that Managing Brokers make is the same thing that many agents make. They try to be all things to all people.

What are the values and business model of your brokerage?  Don’t be afraid to put it out there and tell your story.  It will attract some and repel others and that is okay.  Who you will not hire also says a lot about your business.

Our business is becoming more and more transparent.  With the help of systems like Homesnap, everyone can see the production and type of business that your office and agents do.

After leaving management and becoming a partner in a larger office, I would get comments from associates saying, “Did you get tired of babysitting?”  I found it interesting how agents viewed their associates and themselves. Agents seeing their brokers tolerate and even cater to unprofessional and disrespectful behavior is extremely damaging.  Setting the bar and being uncompromising on it will reflect your character.

Terminating someone who violates your company values can actually be a good thing if done with class.  It shows that you have the courage to adhere to a set of principals and draws a line in the sand for you current associates.

When you put together a group of independent contractors, you can’t manage activities but you can have a common list of guiding principles.

Great sources for this are not only your competition but other successful businesses outside the real estate Industry. I call it being a “Business Scientist”.  Do the research to see what works and then implement it in your own business.

Summertime Fun at SCCAOR’s BBQ

sccaor120bbq

What would summer be without an outdoor BBQ? The two seem to go hand-in-hand. It’s certainly a tradition here at SCCAOR, where every year we show how much we appreciate you, our valued members, by providing a BBQ in our beautiful courtyard free of charge.

This year’s sold-out event, held last week, drew more than 400 people who were treated to great food and drinks and got to do some networking as well. Everyone got to enjoy their drinks with the commemorative glasses we gave away in honor of SCCAOR’s 120th anniversary.

To kick off the event in style, we held a reception inside our newly remodeled office with President Trisha Motter, where people could enjoy some appetizers and see the many exciting changes that we’ve made, especially to our membership department.

Don Jessup of Silicon Valley Associates, who attended the BBQ with his wife, Jennifer Chaing and their 5-year-old son, said he enjoyed the reception and the event overall.

“The reception for the new office was wonderful,” he said. “The remodel is beautiful. The BBQ was one of the best we have ever had. It was a good time for networking and seeing old friends. Thank you for giving back to the members of SCCAOR.”

We recognized several of our many outstanding members. Larry Fargher, CEO of Realcom Associates, received the Distinguished Member of the Year Award for his commitment and service to the real estate industry.

Joe Garcia of Camino Real Realty and Richard Matusich of Richard Matsuich & Associates were recognized for their 47 years of service.

A  dozen politicians cleared their busy schedules in  order to attend the BBQ. We’d like to thank them for coming as well:

  • Campbell Councilmember Jeff Cristina
  • Campbell Councilmember Paul Resnikoff
  • Campbell City Council Candidate Rich Waterman
  • Gilroy Councilmember Peter Leroe-Munoz
  • Milpitas Councilmember Debbie Giordano
  • Morgan Hill Councilmember Marilyn Librers
  • San Jose Councilmember Johnny Khamis
  • San Jose Councilmember Pierluigi Oliverio
  • San Jose Council Candidate Dev Davis
  • Assemblymember Evan Low
  • Assembly Candidate Madison Nguyen
  • State Senator Bob Wieckowski

It was a great event and we look forward to seeing you at next year’s BBQ!

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Going the Extra 7,000 Miles for Its Members: Santa Clara County Association of REALTORS® Gets Creative in Helping Educate About Global Real Estate

 

Members of the Santa Clara County Association of REALTORS® had the opportunity to learn first-hand about differences that exist in real estate between the U.S. and China and how to effectively work with Chinese buyers while on an excursion to China at the end of October that included a professional conference with Beijing agents.

“We have a huge percentage of Chinese buyers in the Bay Area,” explained SCCAOR President Craig Gorman. “In order to work with them effectively, you need to know about Chinese culture. The best thing is to go there and experience it yourself.”

More than 150 top-producing agents attended a one-day conference at Beijing Homelink, the country’s largest real estate agency. Some of the many topics discussed included buyer and seller representation, fiduciary duty, ethics, portals and web sites, and the tremendous influence that Asian culture has had on real estate in the U.S., for example with Feng Shui.

“There is no course that can be taught that can replace what one learns from personal experience,” said Hilda Ramirez, Director of Professional Development at SCCAOR, who led the delegation to China. “The excursion provided an invaluable look into the everyday lives of the Chinese people at a variety of economic levels. An information exchange with Homelink agents in Beijing is an experience REALTORS® dream of.”

Suzana Kubota of Coldwell Banker Previews International said she came back with a better understanding of why schools and education play such an important role in the home buying process for Chinese people and the high standards and expectations the Chinese set.

Anne Hansen, a broker with Realty ONE Group, had the opportunity to meet with young 30-somethings who aspire to be real estate professionals. “They were dying for information,” she said. “How do you get listings. How do you get inventory. They want to be trained in sales. I think they’re very passionate.”

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Santa Clara County Association of REALTORS® Leads Excursion to China

The Santa Clara County Association of REALTORS® will lead a delegation of its members to China today through Oct. 28th on a trip that will include a presentation at the Beijing Homelink Real Estate Agency, the country’s largest real estate company.

Sixteen people are traveling to China, including Hilda Ramirez, director of Public Relations, Communication and Education for SCCAOR, Anne Hansen, a REALTOR® with Realty ONE Group who serves on SCCAOR’s Board of Directors; Pauline Martinez, a broker at AALIS Platinum Properties; and Suzana Kubota of Coldwell Banker, who will all be speaking at Beijing Homelink.

“It is an honor to speak at Beijing Homelink and to lead a group of SCCAOR members to China, where they can learn more about the people, history and culture of this rapidly changing country,” Ramirez said.

“We are delighted that SCCAOR will be coming to Beijing Homelink to lead a discussion about nuances that exist between the United States and China when it comes to the real estate industry,” said Gene Shi, President of Beijing Homelink International Operations.

SCCAOR CEO Neil Collins noted that, “The Bay Area is home to a very large Asian population and with Chinese investors continuing to be a major force in our market we knew we needed to do more to prepare our members for success. SCCAOR members will be one of the very first REALTOR® associations to visit China. Over the next several days, our members will be immersing themselves in the culture and meeting with their Chinese counterparts.”

The Chinese are the biggest group of foreign home buyers in the U.S. and account for 16 percent of foreign buyer activity, according to the National Association of REALTORS®. Sales from Chinese home buyers reached a record $28.6 billion between April 2014 and March 2015.

The trip to China was made available to all SCCAOR members. Participants will visit Beijing, Shanghai, Suzhou and Hangzhou.