No one can predict the future–just look at 2020. That said, we know historically, real estate markets cycle through up and down periods. Years of a post-Great Recession bull run led some experts to say real estate was due for a downturn despite numbers showing increasing median sale prices and volume.
When the pandemic struck, many believed the market was going to a downturn. That didn’t happen. As soon as shelter-in-place orders lifted, pent up demand surged sales. In some markets, total sales activity for the year-to-date is exceeding the same period in 2019.
With the turbulence in the market, how can you prepare your marketing strategy for the coming year? First, let’s look at what might happen to the real estate market in 2021.
Divided predictions for 2021 real estate
There is a feeling the current situation can’t last. Some think the overarching economic factors will outweigh any long-term pandemic impacts and will continue propelling the real estate market.
Some economists feel we are facing colliding scenarios. On the one hand, record-low mortgage rates, a desire to move into more spacious housing to accommodate working from home, and pent-up demand is motivating people to buy.
On the other, sustained high unemployment rates and the increasing number of Americans struggling to afford new homes calls into question how many buyers are available. At some point, these two factors are going to intersect and impact the real estate market. The question is, when will that happen?
Fannie Mae’s Doug Duncan told HousingWire he believes the real estate market faces a “W-shaped” environment. Periods of surging activity will be followed by slowdowns, some of which may be brought on by COVID-19 restrictions. He touched on how the increase in remote work is causing urban dwellers to flee dense cities for more affordable towns where they can purchase more real estate.
With dueling scenarios, how can you prepare your real estate marketing for 2021? Let’s break down what tactic to take for each.
Marketing real estate in a boom
Indicators of a booming market would be a housing shortage. Low inventory drives median sale prices up as buyers compete for a limited supply of homes. This is what we see in many markets across the country. The National Association of Realtors data shows the United States had a 2.7- month supply available of homes at the end of September 2020.
In a booming market, real estate professionals are likely experiencing a seller’s market in their area. Business is likely brisk, especially at key price points, and competition for sellers increases.
To win new listings:
- Leverage your existing network. Create a plan to stay top-of-mind for their real estate needs.
- Ask clients for reviews and testimonials. Promote these on your website and social media.
- Create content to educate sellers on the advantages of listing now.
- Talk about how your marketing strategies will lure competitive buyers.
For buyers, remember they are more likely to face a multiple offer scenario. To win their dream home, they have to a) be first in the door, and, b) present a strong offer. In your real estate marketing to buyers, position yourself as someone who is aggressively looking at new homes to market and as an expert negotiator. Speak to your ability to advocate for their needs no matter how long the search takes.
Boom real estate markets are busy, but don’t let your real estate marketing and brand building fall to the wayside. Establishing a strong network and business presence now will be essential if the market turns.
Marketing real estate in a recession
Typically, housing affordability tanks in a bust scenario. People simply can’t afford to live in the area anymore, shrinking the buyer pool. Activity slows, and markets will see a leveling off or decline in median sales prices as days on the market increase. Increasing inventory places buyers in the driver seat.
To market for buyers during a real estate recession:
- Position yourself as a local market expert.
- Create content to show how much you know about particular neighborhoods.
- Ask satisfied buyers for reviews and testimonials for promotion.
While targeting specific communities in your local area will help sustain and position your business, it’s worth considering diversifying your target markets. If you focused on moving houses in the $200-$400k range, perhaps expand up and down the pricing ladder. Another option is to diversify your services, like adding rental representation.
Use the activity slowdown to optimize your website to capture leads. Target conversions, as this will be essential to maintaining and growing your business during a real estate slowdown.
For sellers, it is essential as the market shifts to favor the buyers that your marketing content focuses on reeducating sellers about changes in pricing and days on market. Remember, most real estate markets have experienced significant appreciation for years. As activity slows, sellers will still have this expectation. It’s up to your marketing to inform and teach them what to expect.
In your seller-targeted marketing, make sure to:
- Explain how you’ll lure buyers to their property with strategic marketing
- What differentiates you from other real estate agents
- Tell stories of how you helped sellers net more value/less days on market
Real estate marketing for any market
No matter what happens with real estate in 2021, remember, people won’t stop searching the internet. Stay on top of your digital marketing to continue building brand awareness and generating leads for your business.
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