Emotional buying?

Question

hi BP

I know that I have trained myself to not emotional buy in my properties.
in fact it's super hard to even try b/c I've trained to walk away at any time.

I don't have much experience in selling bc I buy/hold.
but with those that i have sold, I always had my end buyers in mind.
decor (live in flip), needs (add parking, laundry), and i buy "right" location location location and price.

I recently had the opportunity to walk through a pre-listed house with my broker friend, and realized how different I am from "normal" buyer. (first time)

basically, my broker was worried about all the knick-knack and dated stuff.
all i see is the 4 walls.  and what i can DEDUCT from the asking price.

meanwhile, she is saying: we should do this to make it FEEL warmer/nicer, or the wife would hate this, love this...basically how to ADD value in her pricing

we both walked away saying, wow thought it was a myth, but boy investors/buyers do think differently.

BUT having said that:

Our goal is to get our END buyers to emotionally buy our property, right?

What do you think those factors are?
location location
finishing
kitchen/bath?
curb appeal?

OR do you think PRICE is the main driving factor?

curious to hear about your strategies, if you even think about this. i never did, it just occured to me.

Jennifer Lee · Answer

@lynn yes its crazy some of the thing buyer are put off with.

But the general public is scared of renovation. 
I understand for them to fix this and that are all separate jobs. While we rehabbers get a wholesale deal. One big labor cost plus materials.

And they usually need to move in asap, where we already have a roof over our heads.

A poster mention their own personal home and being more emotional about it.
Nope once I move, it turns into investment rental ;)

Lynn McGeein · Answer

It's been my experience that most buyers are emotional buyers who want to find the perfect place and simply move in, so location, nice floor plan, curb appeal, garage, but for most buyers, that all culminates in if they feel they can just walk in, do nothing except unpack, and be happy.    Like you, I'm the type that can walk over clutter and dark purple paint, cracked tile, etc., and just see the bones of the house and start calculating costs involved.   But I've actually heard friends say they didn't like a house because the bedroom was painted burgundy or the garage was a mess.   They'd rather keep looking than plan on painting a room, like the paint color or clutter somehow made the house defective, no longer their ideal, so they wouldn't be happy there.

Dell Schlabach · Answer

For me every house I buy to rehab and sell, although per se, I am not "emotional" as in I have no problem walking away it I can't make the numbers work.

When I buy a house I take into consideration what the house can look like when I'm done with renovations, and I always try to take the woman's point of view,  I know they are the key determining factor behind most of our sales, just over 30 percent of our houses are actually sold to single women which I found rather interesting when I did the analysis.

And I do not believe that prices are necessarily the driving factor especially for first time home buyers which is the market that we sell most of our homes to. If they are significantly overpriced they will sit on the market much longer, but if your product looks better than most of your competition, you can sell at or a bit above the market from my experience very quickly.

A recent example of price not being the determining factor , we put a house on the market, realtor shows up within a couple hours of us putting it on the market, we were still doing some cleanup, he stopped in by himself, said he wanted to take a look at the house before he showed his client who was going to be driving about 50 miles. Realtor said he had showed his client 30 some houses in that area already and didn't want to waste his or his clients time if he didn't think he was going to like it.

Took a walk through the house said this is definitely was showing, his clients family came down that evening, they wrote an of offer that night for about 15,000 less than list,  said it was way overpriced for the neighborhood  (it was but we had done a helluva job and had spend an extra 10k on septic issues) they liked the house, we ended up selling it for 2000 below list price to that buyer first day on the market.

Things I look for, #1 has to be in a school district where parents want to send their kids to school. #2 must have garage preferably two car + #3 must have a yard. #4 able to create nice kitchen #5;  able to create nice baths , we make sure we do all the other details as well but those are the minimum requirements.

My thoughts

Dawn Anastasi · Answer

I was just talking with the neighbor of the recent investment property I bought the other day about emotions and houses.  He's looking to move (due to a divorce) and I mentioned about renting out his house instead of trying to sell it.  He said he didn't think he could do that, because he couldn't imagine driving past it and seeing someone doing something he wouldn't want them doing.

I mentioned that although I put a lot of time and effort into getting a house ready, I'm not "emotionally attached" and to me, they're just houses.  Although I may feel different about renting out the house I actually live in.

Collier H. · Answer

Hello Jennifer... I think you are right on track. All those factors you listed will cause a buyer to buy a house. I would also add a good school district to your list.