Get Started for Free
Log In
Log InGet Started for Free

First Time Home Buyer Tips

November 12, 2021
/ by 
Josephine Nesbit
First Time Home Buyer Tips

First time home buyer tips for agents that want to their clients to win and close quickly

How to Prep Your First-Time Homebuyers for Success

It’s still a hot seller’s market and 2021 has been a tough year for many families to close a deal. The National Association of Realtors reported that first-time buyers made up only 28% of sales in September. Historically, they make up 40% of all buyers. However, it doesn’t mean your first-time buyers are out of luck. 

Facing the current market does take some prep work, and your buyers are looking up to you to learn the ropes and guide them through the home buying process. Here are some first time home buyer tips to stand out in this complex — and highly competitive — market.

First time home buyer tips for agents

Get to Know Your Client Well — But Quickly!

When working with a first-time buyer, patience is key! Buying a home is one of the biggest financial commitments anyone will make during their lifetime so buyers need to know that their agent is right by their side. 

What’s their budget? Is there a particular location they prefer? What are some must-haves for their first home? You need to understand your client if you’re ever going to help them find the home of their dreams. 

Market Education

Now that you know what your clients are looking for in their first home, you need to get them prepared for what they may face. According to a recent survey by OpenDoor, nearly all first-time buyers experienced challenges when it came to making an offer on a home and nearly three out of five first-time homebuyers felt the market was more competitive than they expected. Many also claimed that the market is too confusing, noting their lack of real estate market knowledge. 

A shocking 98% of first-time buyers lost a home they were interested in. Nearly 56% made five or more offers before purchasing their current home, averaging 10 offers a piece, and 27% put in 10 offers or more. 

First-time buyers also gave their insight on lessons learned during the home buying process. About 35% wish they did more research to improve their knowledge before buying a home. 

While experience is oftentimes the best teacher, agents need to prepare their first-time buyers. Your clients should be ready for a competitive market. The national inventory for active listings declined by 22.2% over the last year, a historic low. Homes are still selling at breakneck speeds, which means every offer needs to be a strong one. 

Look into First-Time Homebuyer Programs

The median existing-home sales price climbed 13.3% year-over-year to $352,800, which marks 115 straight months of year-over-year increases. First-time buyers also don’t have the luxury to leverage equity, making affordability another challenge facing first-timers

The majority of first-time buyers don’t have enough saved to make a 20% down payment, and waiting could mean missing out on a great home. Luckily, there are many first-time buyer programs and grants out there that can help make homeownership a reality. 

Many mortgage lenders offer first-time homebuyer loans, typically through partnerships with a state housing finance agency. Check out these programs by state. Buyers can put down as little as 3% for conventional loans. If they qualify for a VA or USDA loan, they may not need to put any money down at all. 

First-time homebuyer loans may also come with competitive interest rates. Even if your client doesn’t need down payment assistance, they can still obtain a more affordable mortgage with the right program. 

Move Fast

Buyers can’t wait around for the perfect deal to fall into their lap. Properties typically only remain on the market for 17 days in September, which means your clients need to be ready at a moment’s notice. 

Make sure your clients are coming pre-approved and try to take the time to educate yourself on the needs of the seller. Buyers can make their offers stronger when they know exactly what the seller is looking for. 

Make an All-Cash Offer

Another option is to turn your clients into all-cash buyers — even your first-time homebuyers! Cash offers can be intimidating but that’s where Ribbon can help. 

First-time homebuyers can use RibbonCash Offers to avoid being outbid by waiving financing and appraisal contingencies, making them stronger than a traditional cash offer, even if it’s a lower offer than someone with financing. The deal is also guaranteed to close once the inspection period ends. A win for everyone.  

Written by: 
Josephine Nesbit