5 Tips to Help Investors Handle Hoarder House Situations

In previous posts, I’ve shared about getting my start in the investing space with a hoarder house — sucking up roaches as my family pulled up the carpet. As the market has shifted away from short sales, REOs, and trustee sales, real estate investors are working more with equity sellers. Sellers come with many “situations,” reasons why they’d prefer not to go through the standard sale process. Sometimes it’s speed, sometimes it’s cost, sometimes it’s family, and other times, it’s complicated. During this cycle of the market, hoarder-house projects seem to be on the rise.

I recently had the opportunity to interview Dr. Robin Zasio. You probably know her best from her work on the Emmy-nominated TV Show, Hoarders, where she plays herself — portrayed as the most patient and understanding psychologist and anxiety-disorder specialist. If you’ve never seen the show, it’s seriously binge-worthy.

As investors move from negotiating with banks to negotiating with people, some find the process and necessary skill set excruciating. Introverts and process-oriented investors LOVE distressed cycles. You’re beating up the bank on price and it’s not emotional. Working with homeowners directly is a completely different ballgame. This is where extroverts and salespeople shine. Sympathy and empathy can go a long way in complicated transactions, especially when dealing with individuals and families.

In the case of hoarder houses, I was interested in learning more about what was possibly going on in the background that we real estate investors need to understand. Maybe I could shed some light on how to better handle these kinds of transactions.

What is Hoarding?

There’s a big difference between being messy and hoarding. Dr. Zasio shared a case where she was standing in a home with a gentleman and “collector,” who had amassed some 200,000 beer cans. Collecting and displaying a collection of that volume, especially in a small house, takes some serious strategy. As you may have guessed, in this case, she was crushing them and was knee-deep in cans. Despite his proclaimed collector status, when an accumulation of stuff invades space to the point you can’t properly use a space as designed (or live in a healthy environment), you’ve entered the realm of hoarding. Unfortunately, I learned that roughly 90 percent of hoarders who either get organized or move on to another location go back to the same habits. The statistics are very similar to those of alcoholics. But, it doesn’t mean we, as real estate investors, can’t be a positive part of the story.

Zasio says that hoarding falls under the broad category of obsessive compulsive disorders, which have several anxiety disorders underneath, including hoarding disorder. She does say, however, that the two are very different. OCD, she explains, is better described as having intrusive and unwanted thoughts. For instance, someone is chopping carrots and looks at the knife and wonders if they’ll cut their own neck. Then, they stress about why they are having these thoughts, and whether or not they’ll go through with it. The reaction is then to create behaviors of avoidance to those thought triggers.

Zasio says hoarders have obsessive thoughts and compulsions linked to the thrill of the deal. Imagine the 98-cent store has a crazy sale and the thrill of find and landing an amazing deal. The addictive feeling of the win is the compulsive piece. Obsession is continually seeking out the awesome finds. It gets more emotional and powerful when items get specific memories and emotion attached to them. For instance, you bought one item when you were with a loved one, and you attach a moment in time you don’t want to forget to the item. You don’t want to throw it away. It becomes sentimental.

The more I process the interview, the more I can see that there’s a bit of this in all of us. Understanding this behavior certainly can help us empathize with what’s happening. We may not find it rational, but it certainly is a little more relatable.

Five Things To Keep in Mind About Hoarder Houses

1. Be Careful

It goes without saying, in these kinds of houses, you must be careful. These houses can be fire- and health hazards. Dr. Zasio had to postpone our original interview because she was on a project the week prior where a family had reached out to her because their family member had landed in the hospital due to the amount of fecal matter in the home. Despite wearing protection, Dr. Zasio also got sick being in the house. Watch for precariously stacked piles, sharp objects (not just on the floor), and potential health hazards.

2. Don’t Rationalize

Zasio says it’s not always a threat from the health department that triggers a call. In many cases, it’s the family members that reach their wits’ end. They’re seriously concerned about the health and safety of their loved one. The process can be extremely embarrassing and painful for the fed-up family members. It’s also completely distressing to the person dealing with the hoarding issue and being forced to make some life-altering changes they don’t want to make. Their viewpoint is irrational, but you’re not a therapist. So don’t try to play one going into the situation.

3. Don’t Fake Empathy

I know lots of investors who watch Pawn Stars because they love to watch the team at the store negotiate. Someone comes in with a crazy-high value on an heirloom only to walk away with a fraction of what they wanted — but smiling nonetheless. I love the Hoarders because it’s next-level negotiating. Dr. Zasio may not seem like the master negotiator, but I would beg to differ. Please do yourself a favor and look up the show on YouTube. You’ll find Dr. Zasio at her finest when she’s balancing a firm hand with the sincerest form of empathy I’ve ever seen. This is what gets the client to move forward under the worst of circumstance.

We, as real estate investors, can learn a lot from the show. Zasio and her team are working under tight deadlines and high stress. You, too, may witness families fighting and the reluctant client who doesn’t want to change. Avoid fake sincerity. If you really don’t care about the people involved, get someone on your team who does. It’s what always seems to unstick the situation, and it allows the team to move forward. Fake empathy can come across as patronizing and self-serving, and you may end up losing the deal.

4. Focus on the Future

I mistakenly once thought the real estate investor would be the hero in these situations — especially when a family has contacted you to solve the problem. When the health department is threatening to red tag, of course, we’re the saviors in the situation. Right?

Wrong. Whether you’ve already purchased the house or are about to, you’re taking away valuable stuff (at least to them it’s valuable). There’s zero chance they’ll be taking more than 25 percent with them. How would you feel if someone came into your house and told you that within the next several days, you had to get rid of 75 percent of your stuff?

Instead of coming across like a patronizing jerk, Zasio says to focus on validating the difficulty of the situation. Emphazise with the difficulty of the situation. Focus on how to make it as smooth for them as possible in the time allotted. Ask if they have a family member or a trusted friend who can help. You may go as far as asking if they are seeing a professional who can help them through the process. Most investors won’t want to venture into this territory. However, relying solely on timetable won’t get you the result you expect.

Related: How to Handle Hoarders

5. Look for Distress

Investors should always look for signs of serious distress, no matter the situation. Understand that depression and suicidal thoughts can be a major side effect of what is transpiring. If you’re uncomfortable having hard conversations directly, pass on resources to a family member.

Zasio recommends looking into the International Obsessive Compulsive Foundation. This organization has a database of professionals with a passion for people with anxiety and hoarding disorders. Zasio also suggests doing a search for a “hoarding disorder taskforce” in your area. These are groups of volunteers who may be able to provide some local resources. One final unexpected resource is local, professional organizers.

I love the real estate business because we operate in the world of problem solving. Every house is different and comes with its challenges. In this cycle, we just happen to be focused more on people, and we have the duty to do, and be, the best we can — because it matters.

Do you have any experience with hoarder houses?

What tips do you have for easing the situation? Share below!

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.