Erica Christoffer is a multimedia journalist and contributing writer and editor for REALTOR® Magazine. She can be reached at firstname.lastname@example.org.
Building a Builder Team
Low inventory? Brokers can help create inventory. Learn how to partner with small-volume builders to bring much-needed housing to your area.
November 19, 2015
Inventories are low and demand for homes is high in markets across the U.S. First-time home buyers are especially feeling the inventory crunch as they lose out in bidding wars or simply can’t afford what’s for sale in their area.
The share of first-time buyers has declined to 32 percent, according to data published in the National Association of REALTORS®’ 2015 Profile of Home Buyers and Sellers, which is down from 33 percent a year ago. It’s the second-lowest share since NAR launched the survey in 1981, and the lowest since 1987 when first-time buyers made up only 30 percent of transactions. First-time buyer purchases have historically averaged about 40 percent of total sales.
New construction could alleviate inventory shortfalls in some markets, says Tracy Kasper, SFR, GRI, broker-owner of Silverhawk Realty outside of Boise, Idaho. Kasper presented her experience working in new construction and land development during the REALTORS® Conference & Expo in San Diego last week.
When builders all but stopped building during the downturn, Kasper, who runs six offices with 88 agents, went into the REO and short-sale side of the business. But now that the market is fertile enough to produce new homes once again, the 24-year veteran has jumped back in.
She started attending her local building contractors association meetings back in 1997, and it has since helped her connect with many local builders — including low-volume businesses that build a half-dozen homes per year.
“Go and show them how they can get back in the market,” Kasper says. “Show them you’re committed and involved, and interested in their success.”
Another key is to successfully partnering with a builder is to surround yourself with the right people. Of her nearly 90 agents in the Treasure Valley region, only six are on Kasper’s new-construction team. “They have that same passion as I do,” she says.
If you’re operating an on-site sales office at a new development — which Kasper finds successful in her market — train agents to talk to buyers in detail about its features. Make sure they can discuss energy efficiency, walkability, community amenities, and how the homes compare to other developments, Kasper says. And ensure that your salespeople understand the phases of the project and the construction materials.
Agents need to know the market area like the back of their hand, Kasper says, which will help them capture drive-by prospects. Ask them get out of their car or the on-site office and walk the community, Kasper says.
“Know your competition and know what they’re doing,” Kasper says.
Once a partnership is established with a builder, and you’ve assembled your team, brokers should be prepared to invest marketing dollars into a website geared toward new construction presentation. Include interactive home tours, floor plans, and professional photos. Some builders will split the cost on this, Kasper says.
Also, consider providing incentives to agents for selling within that plat, Kasper suggests. But remind agents that they must disclose any bonuses received for selling the property to their buyer clients.
“Your agents have to be as dedicated to your plat as you and your builder are,” Kasper says.