How Homebuilders can Attract First-Time Homebuyers

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First-time homebuyers offer a blank slate for homebuilders. Customer Satisfaction expert Paul Cardis explains how you can turn these buyers into referral machines.

February 01, 2008
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Cardis' Tips

As builders strive to reduce inventories in a soft market, they can't afford to let any potential buyer slip through their fingers. There's one type of customer you definitely don't want to lose: it's the first-time home buyer.

According to home buyer surveys, first-time home buyers tend to be more satisfied with their purchasing experience than home buyers who have bought a house before. There are several possible reasons for this: expectations, enthusiasm and education.

Happy home buyers equal referrals, and as you may recall, referred prospects are twice as likely as traditional prospects to buy. Though referrals are key to every home builder's success, they are even more essential in a buyers' market.

To attract more first-time home buyers, make sure your organization is doing everything it can to appeal to this unique breed of customers. Some ideas:

Sponsor seminars for first-time home buyers. Hold free events where people can get all their questions answered about purchasing a home. Have every department represented. But don't make the seminar a blatant sales pitch for your company; instead, offer free, professional advice and earn prospects' trust.

Help them get their ducks in a row. Have systems in place for educating prospective first-time home buyers about the lending process and what steps they can take to improve their credit score before they meet with a lender.

Match them with a caring lender. First-time home buyers often have no idea what sort of house payment they can afford. You can alleviate their fears by matching them with a trustworthy lender or mortgage broker who has their best interest at heart.

Don't push too hard. Home buyers know that market conditions are in their favor, so any aggressive attempts to close the deal will be viewed as desperation. Instead, acknowledge that today's home buyers have a lot of purchasing options and illustrate for each client why your company is the best choice.

Inoculate. Unlike experienced home buyers, first-time new-home buyers may not understand the building process and what types of things can go wrong. First-time buyers need to be warned about potential problems and reassured that every issue will be resolved to the home buyer's satisfaction.

By customizing your processes to take into account first-time home buyers' unique needs, you're ensuring their long-term satisfaction and, equally important, their rate of referrals.


Author Information
Paul Cardis is CEO of Avid Ratings Co., a research and consulting firm specializing in customer satisfaction for the home-building industry. He can be reached at paul.cardis@avidratings.com.

 

Cardis' Tips

Educate: Be prepared to advise first-time home buyers. They look to you for expertise on everything from credit scores to patio doors.

Track: Make sure everyone in your organization knows who the first-time home buyers are and takes extra time to ensure their understanding and satisfaction.

Solicit: Take advantage of first-time home buyers' increased levels of satisfaction by asking them to make referrals. 

Double Dip: First-time home buyers have greater potential to become repeat buyers if they are delighted the first time around.

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