In a real estate transaction, getting emotional will only get people into trouble. It’s hard, because buying or selling a home is the biggest single purchase of most people’s lives. A home is more than just a possession; it is at the center of our lives, the base of lifestyle that plays a strong part in our sense of identity. An investment that big and that far reaching is extremely personal. Despite this, real estate is business, and a sales contract is a contract; keep these things in the front of your mind and push emotion to the back seat. Otherwise, you could fall prey to emotion-driven mistakes.
Selling your home is like giving up a piece of yourself. A home carries so many memories and so much baggage that a seller’s emotional attachment can override their logic. When a seller looks at the home, they see the years of personal investment and work (maintenance and upgrades), and often overvalue the home. Naturally, they want to get the most money they can; they feel the need to recoup their own purchase price and they feel that the time they spent in the home has to translate into a financial gain. Unfortunately, the current selling price of a home has nothing to do with the old purchase price, and little to do with the personal and financial investments of the sellers. Selling price looks at the home’s features and the current market: what a stranger would be willing to pay for the home based on what it has and what else is out there. Working with an agent can help sellers come to grips with the market value of their home, so they can list it realistically.
When your home is shown, the seller should be out of sight and out of mind. Emotional sellers are house-proud, and they want the opportunity to share their feelings, stories, and estimations of value with potential buyers. Buyers, however, are put off by the emotional output of sellers and feel pressured by the owner’s presence. While you may think that you can put up a good sales pitch, it’s best to leave these things to the professionals and make yourself scarce. Work with your realtor to isolate the selling features that will best appeal to buyers and find ways to highlight these features in your promotional materials and home staging. Let your agent or the buyer’s agent speak for you, and help your home speak for itself.
When offers begin to arrive, many sellers let their emotions rule the decision making. They feel that if they hold out just a little longer, a better offer is sure to come in. Certain that someone will fall in love with their home and give them all they feel they deserve for it, these sellers reject many reasonable early offers and risk their chances of achieving a sale. In many cases, early offers are the best offers. The longer a home sits on the market, the more pressure there is on the seller, and buyer’s know this. They also assume that if a home doesn’t sell quickly, there are problems. Both of these lead buyers to offer less as time goes by, not more. Additionally, the longer a home sits on the market the more ‘stale’ the advertizing and interest gets; the most viewings and offers tend to come in the first few weeks of a listing. Long-listed homes often are forced to resort to price reductions and other gimmicks to drum fresh interest. Let your agent help you determine if an offer is truly reasonable and work with you to form the best counteroffer. Always keep in mind that the goal is to sell the home, and that can mean compromise.
Low offers are a part of the real estate game. Buyers want the best deal possible, sellers want the highest price: it’s bound to cause conflict. Negotiating a home sale is confrontational, with both sides focused on their opposing goals. Sellers can’t take a low offer as a personal attack; remember that when it’s your turn to buy you’ll likely try the same. What an emotional seller might see as an insult, the buyer might see only as a tactic for negotiations. An agent can help you keep a cool head, and stand as your advocate in the negotiation battle. Work with your agent to form counteroffers and walk the delicate line of push and pushback in order to arrive at a contract both you and the buyer can live with.
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About Geoff Thompson — Geoff Thompson is an Owner and Founding Partner of Colibri Real Estate, LLC. which operates online education providers Colibri Real Estate, Insurance License Express and License Tutor. Follow him on Twitter.