Buyer’s Remorse / Seller’s Remorse
In real estate most people are familiar with buyer’s remorse, and anyone who has ever bought a house or any large item may have experienced it. But sellers have their own remorse and it can be just as significant.
In buyer’s remorse the buyers have a sense of regret after having made such a large purchase or commitment. Once the offer is made, a sense of would-have, should-have, could-have sets in and they begin to have self-doubt as to whether they made a good choice. Usually if you run through the details about what concerns them it puts their mind at ease. For example: if they are all of a sudden concerned that the house it too expensive and they cannot afford it, simply pointing out the tax advantages of homeownership may relieve their anxiety.
I remember one young couple that bought their first house. Within hours of sending the offer to the listing agent, I received a call from the buyers panic stricken that they may have jumped too quickly. We talked for a little bit about the pros and the cons of the house and how it fit into what they wanted and then there was a long pause on the phone.
After several seconds I mentioned that unless the sellers have accepted and conveyed acceptance, they could always rescind the offer and that would take it off the table. The wife, who had been leading this charge, quickly replied that they did not want to do that – they wanted the house. They settled down and eventually closed on the house.
Sellers’ remorse is along the same lines, but as you may have guessed, it’s about selling their house. One of the most important things – if not the most important – is pricing your house right. If you price it too low, the sellers lose money. If they price it too high – it may not sell or it may sit on the market for a long time.
When I talk to clients about listing price I always stress to them that it is about selling the house, not listing it. Any agent can list a house, but true professionals price it to sell and at the maximum profit for their clients.
If a house is priced right, my best estimate is that there should be an offer on the table within 30 days. The average time on the market in this location is about 90 days, but that is an average and really has no bearing on a home that is priced right. In addition, a home that is on the market for 90 usually has at least one price reduction.
I recently had a client that had already closed on a house they had purchased and was now ready to sell the house they were living in. We had our talk about pricing it to list or pricing it to sell and the sellers made it clear that they wanted to move the property, but they also wanted to get the most they could for the house – a very reasonable request.
The Comparative Market Analysis (CMA) determined the price range that the house would most likely sell for and of course we went for the high end, which was still a reasonable listing price. On the third day the house was on the market we had an offer and by the end of the fourth day we had a second offer coming in and accepted one of the offers for a binding agreement. I will also note that this took place in 2013 not at the height of the real estate market.
Shortly before the closing, the sellers were talking to a relative, who is not a licensed real estate agent, and the relative stated that if the house sold that fast, it was underpriced!! Needless to say, the sellers were concerned that they may have sold at too low of a price and the sellers’ remorse set in.
I talked with the sellers’ on the phone and I assured them that the price we were at was a good price and was not too low. We went through the data on the CMA looking at the comparable homes and then I gave them a breakdown of recently sold and listed homes in their area by square footage. The price per square foot for homes in their area ranged from $116 – $160 a square foot – theirs sold at $164 a square foot. Their sellers’ remorse disappeared as quickly as it came.
If you are a buyer or seller who is experiencing remorse, talk to your REALTOR and get the facts that can paint a clear picture. In fact, if you are thinking of buying or selling, talk to a REALTOR who can give you the information you need to make an informed decision before you have any remorse.
As always, if I can help with any of your real estate needs, please feel free to text or call me at 615 417-8182 or email me at RolandLow1@gmail.com.
How Real Estate May Save an Ailing Job Market
The overall economic recovery is betting big on real estate’s continued progress. After all, a stronger real estate market can lead to a stronger job market.
Strength in the real estate sector tends to lead to increased hiring in various housing-related industries, from carpenters and landscapers to real estate agents, loan processors, appliance manufacturers, furniture makers, and more.
When it comes to job creation, “the most promising news is related to the housing market,” says John Challenger, CEO of employment consulting firm Challenger, Gray & Christmas.
The construction sector for housing added 28,000 jobs in January alone.
“Since reaching a low in January 2011, construction employment has grown by 296,000, with one-third of the gain occurring in the last four months,” according to the Bureau of Labor Statistics.
The National Association of Home Builders says that for every home start, three new jobs are added in industries such as lumber, concrete, lighting fixtures, and lending.
If the housing market rebounds to its historical average, the economy could generate 2.9 million direct jobs from it, according to the Bipartisan Policy Center, a Washington think tank.
source: REALTOR Magazine