Real Estate Round-Up: Attitude affects motivation
Last updated 7/9/2020 at 5:32am
· 1. a settled way of thinking or feeling about someone or something, typically one that is reflected in a person's behavior: "she took a tough attitude toward other people's indulgences"
Synonyms: point of view, view, viewpoint, vantage point, frame of mind, way of thinking, way of looking at things, school of thought, outlook, angle, slant, perspective, reaction, stance, standpoint, position, inclination, orientation, approach, opinion, ideas, belief, convictions, feelings, sentiments, persuasion, thoughts, thinking, interpretation
A few weeks back I wrote about motivation and how it impacts how buyers and sellers respond to events leading up to, or during the process of writing an offer. Motivation affects the structure of the initial purchase contract and is an underlying piece to the negotiations within the escrow. Motivated buyers and sellers find a way to make things work, so that at the end of the day, the seller sells and buyer buys.
Attitude, however, is going to impact how the motivation shows itself in real life. The seller’s attitude will generate a response that is based on that often hidden attitude. For example, if a seller believes that they are owed something, perhaps because of their emotional or practical commitment to a property, they may choose to respond based on defending that commitment.
On the other hand, if a buyer believes that they are owed something, based on their strong qualifications, they may choose to respond based on those qualifications. We see these and many other “attitudes” play out during real estate transactions.
Recently, we had a seller who, although knowledgeable of the ups and downs of the marketplace, had an attitude that she was owed a specific amount for her home. In all fairness, the marketplace is very volatile, so what appears to be a reasonable selling price today, might be very different tomorrow, if your neighbor decides to “liquidate” their home.
In the case of this seller, that is exactly what occurred. The seller had been listed twice before with no success. We listed the home, based on the surrounding comps, and came up with a “selling price” that the seller agreed with. Everything changed when the sellers of the property up the street modified their expectations.
The neighboring property was a major component of the information utilized to help set the seller’s list price. Within days of listing our seller’s property, the neighbor reduced their price by $50,000. Yes, I said $50,000. That change had a huge impact on our seller’s property value.
To make matters worse, that property immediately went into escrow. We were not surprised, but this new “comp” was absolutely going to impact the value that our seller would be able to expect for her home. Makes sense, right? The only challenge was, the seller’s attitude, had not changed. The seller still believed that she was owed a specific amount for her home, based on her emotional and practical commitment to her home, combined with the original, now no longer current, price of the neighbor’s home.
Another seller we are working with, has a very different attitude about their home. Make no mistake, this home is magnificent. The sellers truly invested their personal commitment and finances into the home. Their attitude, however, is one based on facts and perspective.
Before their home even went active on the multiple listing service, another Realtor, represented a buyer who wrote an offer at a very high purchase price. It was a dream number, based on the motivation of the buyer to “lock the home up” before anyone else had a chance to make an offer. The Sellers were ecstatic.
However, the buyer ended up walking away, almost as quickly as they entered, so the home was back on the market. Because of the ups and downs of the marketplace due to COVID-19, activity remained slow, until three weeks ago, when buyers started looking again. Since then, the sellers’ property has had multiple daily showings and received two offers last week.
This time, the offers were consistently less than three months ago. However, the sellers attitude continued to be based on facts and perspective, and the property went into escrow at exactly the price the sellers originally communicated with us that they wanted.
A word about sales price. Realtors offer comparable market analysis when they meet with sellers to list their home. A CMA is based on history. Realtors can often see trends, but 2020 has not been a year where consistent trends exist.
If I looked at activity and sales price from January through March 2020, it would be unfortunately very different from April through June 2020. Economists project a slight drop in sales with prices remaining flat through 2020, but that’s assuming we don’t have any new issues that affect the economy.
I’ve said it before and it’s worth repeating, Realtors do not have a crystal ball. We have years of knowledge and experience, but none of us would have predicted a pandemic and the complete shutdown of California. That shutdown put an end to what appeared to be the beginning of one of the best years in recent history for real estate.
Keeping this in mind, understand, not the seller, nor the buyer determine the sales price of a home. Sellers can reject offers and buyers can submit offers. Appraisers are tasked with the job of looking at history, taking into consideration trends and then calculating a “value” for the property. Appraisers are not always right, but my point is, they ultimately do determine what price a home will sell for.
Attitude underlies the response and the ultimate satisfaction both sellers and buyers derive in a transaction. Here’s to making sure your attitude has a healthy dose of facts wrapped around emotion, and satisfaction is sure to follow.
Kim Murphy can be reached at [email protected] or 760-415-9292 or at 130 N Main Avenue, in Fallbrook. Her broker license is #01229921, and she is on the board of directors for the California Association of Realtors.