Today’s script touches on the cost of waiting and how to explain the pitfalls to buyers and sellers.
Topic – Talking tough
Mentor – Bernice Ross
- Understanding the long term cost to buyers
- More on the stats
- Get the scripts
Kevin: Joining us once again this morning, to round out our series of having tough conversations in the changing market, understanding where the market is, Bernice Ross from Real Estate Coach Radio who has taken us through a step journey this week. We’re going to look at the final part of this puzzle, and looking at a different pain point here, Bernice, isn’t it? In terms of when interest rates are increasing, maybe values are also … How do we explain that?
Bernice: Well Kevin, I wanna draw the distinction, the script that we’ve been over yesterday addressed affordability. So, that script was really about, you know, how much can you qualify for? Is your income gonna go up from 45000 to 52000 and if not, you’re not gonna be able to qualify. You know, you won’t be able to afford it. So, that was on affordability. But today’s script touches on something that we touched on yesterday and before, is the cost of waiting and this script focuses on how much more, with the value that’s going to be in the property, plus how much additional interest, so it’s slightly different. These scripts are, you know, you can kind of fine tune which one you wanna use, I’ll be happy to send them to you Kevin.
Kevin: Thank you.
Bernice: So, that will help your listeners just to have it here. Let me give you this script. So this one is gonna focus on, instead of what’s it gonna take to qualify for, it’s gonna focus on how much more they’re going to pay for the property next year plus the amount of additional interest. So we’re going after the total amount of increase versus their ability to qualify. So, here is the script.
Bernice: Mr and Mrs buyer, prices are predicted to increase by 3.1% over the next year and interest rates are predicted to increase from 4.85% to 5.85%. This means that next year at this time, the $250,000 home you’re looking at today, will be worth $257,775 in 2019 and you will pay $5,775 more for the same property plus an additional $46,209 in additional interest. In other words, the cost of waiting a year to purchase, is $51,984. It’s your choice. Buy now and save $51,984 in additional interest and appreciation cost or pay more and settle for less next year.
Bernice: Now the point to note here is that rather than just going with the turn up the pain, you gonna pay more and settle for less, I went to the notion that they’re going to save more in additional interest which appeals to most people. You know, you’re gonna save almost $52,000 by acting now. Now that’s a pretty strong motivator.
Kevin: Very strong. Very, very strong. Bernice, it’s been great sharing these scripts and you’ve offered to provide them for us and I thank you for that. What we’ll do is put the scripts below each one of the discussion points we’ve had as the week goes. That will help you in your role play and Bernice Ross, of course, has been our guest all week. Bernice, is from Real Estate Coach Radio and will be one of our very special guests as we broadcast live from the Inman Conference in New York at the end of January 2019. Bernice, we will talk to you before then because Bernice is also talking to a number of top performers in a series that we’re going to be producing that will come out, a video series that will come out every Sunday as well. So watch out for that. Bernice Ross has been my guest all week. Bernice, great talking to you. Thank you so much for your time and I look forward to talking to you again real soon.
Bernice: Thanks Kevin and I wanna wish all of your listeners a very happy holiday season and the best year ever in 2019.