3 Reasons Why Buyers Aren’t Closing on New Construction Projects in 2023 (And What You Can Do About It)

When the market is hot, selling is easy. Buyers practically snatch up properties as soon as they appear. But the good times can’t last forever, and when the market cools, it’s time to get creative.

In this article, we take a look at the three main reasons why prospective buyers are reluctant to close on new construction projects in 2023, and what you can do about it. In short, the three things stopping buyers are: financing concerns, fears of delays, and last but not least, a lack of emotional investment in new construction properties.

Clients fear for financial stability

Financial concerns are at the top of everyone’s minds going into 2023, with a recession looming over the horizon, mass layoffs in many industries, and tightening credit markets causing serious liquidity concerns for many. 

Real estate is no different, but with an added catch. Most homebuyers who are willing to buy a house in this climate are less concerned about their own finances, than those of the developers they’re buying from. 

Most of the time everything goes smoothly. But a few projects out of a hundred going bust before buyers take possession of their new homes are enough to put the fear of failure in many buyers.

It may not be your fault and you did not cause this fear, but there’s a very real chance that the person sitting in a meeting with you is thinking only one thing: “will I actually get what I pay for, or will they run off with my money?”

This is especially true for early-stage projects, when you still only have some grand designs and floor plans to show off. 

Buyers fear construction delays

Yes, delays happen, especially with broken global supply chains delaying messing with everyone’s schedules. But there are delays, and then there are delays. No one wants to be waiting for move-in day for many years more than they initially planned.

Many prospective buyers feel that buying an already existing property is a much safer option for this reason alone. 

Many others want to have that “new home” feeling of stepping into a residence for the first time as the very first owners. But that feeling is hard to manufacture when you only have blueprints and schematics to show off. As the selling agent, it’s your job to make buyers feel emotionally invested when they’re still sitting in your office, trembling above the dotted line. We have a few suggestions on how to achieve it in the bottom.

They’re just not feeling “it”

When you’re invested in a project, when you know it inside and out, it’s hard to imagine that others don’t get it the same way you do. But the truth is, your prospects don’t know your project, and they don’t care about it yet. 

That’s hardly surprising. There’s an immense difference between stepping into a standing building and imagining yourself doing it. 

Humans are visual creatures, and seeing something with our own eyes makes us much more emotionally committed than trying to imagine it for a few minutes. And let’s face it, a few minutes of imagination is the most we can expect from the majority of our prospects. 

This causes many to skip potential homes that could have been perfect from them, if only they had enough time or the right visualization to imagine themselves living in them.

This factor is especially important now, when the available inventory of fully complete homes is increasing and the competition for buyers is fiercer than it has been in years.

What you can do to help buyers sign

Sadly, there is no magic bullet that can fix everything, but there are things you can do. 

For one, they say that your word is everything, and this is the time to let your word shine. If your reputation doesn’t precede you, make it. Proudly display all your past successes and accomplishments. 

This is the time to brag about every project you’ve completed under budget and on time. Don’t be showy, but good sales collateral should mention your ratings, quotes from satisfied customers, and invite customers to view your previous successes. 

You don’t need to give away all your trade secrets and connections, but try to give your leads assurances that you’re prepared for supply chain disruptions, as well as the regular disruptions that creep up during construction. This is again time for your word to shine, but it’s easier when you can back it with concrete facts.

Another card you can draw from your sleeve (and one that can give you an advantage over your competitors), is if you can just show your buyers exactly what you’re selling.

Now, how can you show them a property that still isn’t finished? Or one that you haven’t even started building yet?

Luckily, there are solutions. From artists’ sketches, through showroom apartments built for purpose, to architectural renders, there are plenty of solutions around. 

Virtual tours make buyers feel at home

Personally, we think that the more immersive and realistic the experience you give your prospects, the better. A good visualization allows your buyer to imagine themselves in their future home, and that can go a long way to helping them forget all about their fears. 

Vizit.co is one such leading visualization platform. Vizit.co allows you to upload floor plans and get a fully modelled, photorealistic virtual tour delivered in no time. Tours can be easily shared or embedded in any website, and you get detailed analytics on buyers and properties through a seller’s dashboard. You can try a tour here.