Agent to Agent: 4 Ways to Navigate a Tough Housing Market

Last year was tough for agents and their clients alike. What started with low interest rates, bidding wars, and scant inventory was eventually marked by increasingly expensive mortgages, not enough buyers, and still not enough inventory. 

In 2023, Zillow economists have expressed a cautious optimism that the worst is behind us. They expect a modest decrease in home values and believe borrowing costs will slowly improve for buyers. 

To help get a complicated year kicked off on the right foot, we’ve compiled some timely advice from agents who’ve seen success with Zillow. 

1. Make the connection

Every home purchase or sale starts with a call. In a cooled market, it’s crucial to treat every call with the utmost care. Follow up quickly to build trust and show your prospect that their call is important to you. 

“When you have Zillow leads, you’ve got to respond to them right away,’’ says Sarita Dua at Keller Williams Realty Professionals in Portland, Oregon. “Being a single agent, you might be in a listing appointment or out of the area or whatever. If you don’t call that lead right away, you’ve really reduced the chance of connecting with that person.” 

That call also has the potential to be more than one transaction. It can help to think of the lifetime value that a call could mean for your business, says Marcus Larrea of Palm Paradise Real Estate, a southwest Florida brokerage with more than 55 agents.

“You can’t look at each connection as one deal,’’ Larrea says. “You have to look at each connection as a long-term investment where you’re going to get repeat business and referrals.”

2. Use the ALM framework

The ALM (Appointment, Location, Motivation) framework is a proven approach that helps you close more leads from connection calls. Read on to see how agents make the most of each part of this framework. 

Appointment

Zillow data shows that when a buyer and agent confirm an appointment on the connection call, they're 3x more likely to transact than if they didn't. Once you’ve established contact with a connection, make setting that appointment a priority on the first call. 

Location

Insights gathered from some of our most successful Zillow Premier Agent partners indicate that you’ll close more deals by focusing on the person, not the property. We’ve also found that, despite the pandemic, the typical buyer surveyed between 2020 and 2022 went on three private tours. When you first speak with a connection, ask them what they like about the property and take note. Then establish yourself as an area expert on that first appointment by showing the buyer one or two more comps. Besides, the home they’ve called about could be under contract or already sold.

Agent Hao Dang, who leads the Hao Dang Team at Windermere Real Estate in Bellevue, Washington, says he takes clients to see about six homes in a day and then asks them, “Which three would you like to make an offer on?” Their answers can reveal a lot about what they truly want. 

Motivation

Ask your client about their motivation for calling about a home. For example: “What interests you about these properties?” Questions like this empower you with info about what’s driving your lead, which can also help you build rapport with them. This also equips you to find more homes they may be interested in.

Read more about agent strategies for winning the deal. 

3. Share market data 

As the last year has shown, changing market conditions are challenging for buyers. This is doubly true when they believe they already know what to expect.

“Experienced buyers may have preconceived expectations on how things should go according to their last purchase,” says Laurie Finkelstein Reader, CEO of Laurie Finkelstein Reader Real Estate in Fort Lauderdale, Florida. “Assuming the market is behaving differently , they may be taken back by the process.” 

Sharing data about new listings, recently closed sales, and economic trends can help buyers understand how the market might be favorable for them and whether or not now is a good time to purchase a home. The more they know, the better prepared they’ll be to make an offer when they find a home they like.

This goes back to learning about your clients’ motivations. 'After we understand a client's fears and concerns, we can help eliminate them through data and market info,” says Joy Kim Metalios of the Metalios Group. “Creating an environment in which our clients feel educated, knowledgeable, and truly comfortable in their decision is our goal — and has been a fundamental component of our success.'

Tulane Joseph, a realtor with Dannecker and Associates at Compass in San Diego, doesn’t hesitate to offer buyers a positive take on market conditions, like a rise in mortgage rates, that may seem worrisome.

“I put the elephant in the room,” Joseph says. “I say, ‘The prime rate just went up. You know what that means for you? Fewer buyers, less competition and more negotiations. And, by the way, interest rates, comparatively speaking, historically speaking, are still on the low side.'”

4. Stay open and transparent

Buying or selling is a big decision, and there’s a lot of uncertainty involved. That uncertainty can cause a lot of stress. A 2022 study found that homeowners reported higher stress than renters, and that stress levels increased the more frequently someone moved. 

As an agent, you can help to reduce both uncertainty and stress. 

“It’s our job as the real estate professional to control the environment as much as possible,” Reader says. “Keeping buyers informed and infusing a lot of transparency into the process is what the consumer needs and deserves, and then under any circumstances, you should be able to have a smooth transaction.”