As we are getting closer to the midpoint of 2021 (How did we get here so fast?!), many of last year’s trends seem to be here to stay. Real estate agents are using “Real Estate TikTok” as a marketing tool to attract prospective homeowners. People seem to have a newfound appreciation for nature, and as they have been taking trips by car more frequently than by plane, sales of second homes have risen substantially.
With a hot seller’s market, upfront underwriting has been a popular tactic for buyers to turn the tide. Low mortgage rates, along with high lumber prices, have led to record high average home sale prices. As new homes become more and more unaffordable for the average American, Biden has rallied for legislation to help address this trend.
Keep reading for insights into these topics and more.
Through the first three months of the year, year-over-year, the number of second home sales is up 46%. Second home sales actually make up 6% of all mortgages. Pandemic impact? Likely. For many, the pandemic has created a need to have somewhere to escape. Especially if you live in a large metropolitan area. A second home offers just that. Affordable markets, and smaller markets, are the hotspots for these sales. Cities at the top of the list include Marion, North Carolina; Sturgis, Michigan; and Ruston, Louisiana.
Biden’s $15K First-Time Homebuyer Tax Credit Now a Bill (HousingWire)
The House of Representatives has introduced a bill based on president Biden’s recommendation that has been dubbed the “First-Time Homebuyers Act.” As the price of homes continue to rise, and set new highs, this legislation is meant to help low- and middle-income prospective homeowners. While there are several requirements that must be met, the bill would provide a tax credit of up to 10% of the purchase price, or 15,000, for first-time home buyers. In 2008, a similar piece of legislation was passed. The Housing and Economic Recovery Act was popular as 1.5 million homebuyers took advantage of the incentive.
A growth mindset is sometimes referred to as an entrepreneurial mindset. This comes as no surprise as mindset is so important to an entrepreneur’s success. A growth mindset consists of a collection of skills that allow individuals to harness opportunities, thrive in all sorts of competitive environments, learn and implement strategies, and overcome obstacles. This mindset is critical to building a new business. Have you spent some time thinking about your mindset and how it impacts your investing business?
Real-Estate Agents Are Finding Success by Turning to TikTok: ‘It Doesn’t Seem to Matter If the Place Is $2,000 or $600,000’ (Business Insider)
TikTok has a reputation as a haven for teenagers to participate in dance challenges. However, as the social media platform has exploded in growth, brands are finding success. And now, real estate agents are too. Real estate agents are reporting success using TikTok as a source of sales. Adoption of digital methods has grown during the pandemic. In addition, part of the appeal is that you don’t need a huge following to go viral on the platform. TikTok’s “For You Page” shows content in user’s feeds based on their interests. TikTok also allows you to share your content on other platforms, like Instagram. This cross-pollination allows you to easily increase the reach of your content.
It is a well-known fact that we are going through a seller’s market. One that has led to bidding wars. Some buyers have tried to differentiate themselves from the rest through upfront underwriting. This basically means that a buyer has done all of the work to get approved for a mortgage. However, there is a risk for buyers here because if their loan does not get approved, they will lose their deposit on the house. This is a risk some buyers are taking due to the competitive market.
The pandemic has transformed a lot of things in the world of real estate. The explosive growth of a new platform means new ways for real estate investors and agents to find new home buyers. “Real estate TikTok” has taken off, allowing huge success for real estate agents.
In an already competitive seller’s market, the rise in sales of second homes has been an interesting development. It’s also a relief for first time buyers to have an incentive to find their first home with President Biden’s homebuyer tax credit.
We’ll catch you next time for another selection of hand-picked resources to boost your real estate investing business.
Stay safe, stay healthy, and happy (and profitable) investing.
P.S. Are you a MyHouseDeals tribe member looking for some inspiration? Check our our most recent investor success story for some enlightening advice from Jarrod. Watch, listen, or read his story here.