Far too many Americans are living paycheck to paycheck.

According to a recent report from LendingClub, 64% of Americans say their budgets are stretched too thin—a historic high that was first hit in March 2020. 

It’s no secret that inflation has changed homebuying plans for many, and it leads to the question:

How can real estate agents support homebuyers living paycheck to paycheck?

Address the Fear

I recently dove into this question on the Hot Sheet. As real estate agents, we want people to be able to build equity and wealth through homeownership, but when budgets are already stretched too thin, people lose hope.

If you start talking to consumers about buying down rates or interest rates dropping from 7% to 6%, many will remind you: I am living week to week. I don’t even know how I’m going to pay my bills; I can’t think about buying a home. 

Your job, as a real estate agent, is to address that fear. 

And it starts with a conversation.

Have a Real Conversation

First off, you need to have a real conversation. 

Remind the people you talk to that, at the end of the day, a house is just shelter. So whether you buy or rent, each person needs to make the best decision for themselves and their family.

Start by asking: How long do you plan to live in this community?

Once you have the answer to that question, you can help them develop an actionable plan that works for their budget. 

For those who plan on staying in the community for at least 7-10 years, you can look at neighborhoods 15-20 minutes outside their preferred neighborhood. Properties outside a buyer’s preferred location will often fit into their current rental budget. So, if they are willing to search in other neighborhoods, you can start to explore some of the unique opportunities for buyers right now.

The answer is simpler for those who know they are only staying in the area for 1-3 years. Rental prices are slowing—and even coming down in many areas. Help them find an affordable rental—preferably one that allows them to start saving part of each paycheck.

Gain Trust by Helping the Buyer

We don’t know how long it will take before inflation and affordability get under control.  

When your first priority is helping the buyer, your best advice may be to help them find an affordable rental. By having a real, honest conversation with them, you will gain trust and build a relationship.

As a real estate agent, consider just how many people are feeling the effects of inflation. The same LendingTree report shows that, for the first time, more than 50% of all six-figure earners feel their budgets are stretched too thin.

So it’s not just the $50,000 earners who are living paycheck to paycheck—it’s the majority of your clients.

In your marketing, in your conversations, and in your consultations, you need to address these fears upfront and show you understand.