This area of multifamily and commercial properties is new to me and quite a challenge and one thing that would make it easy for all is to determine what constitutes a motivated seller. I obviously have observed that the bottom line would be the bottom line. I asked the question of the BP community and found an article that had credence and how that could address the owner / seller's motivation (https://www.biggerpockets.com/forums/93/topics/767...
Stess What A Concept
However, the concept of stress was pertinent to my education in health psychology and I received training in doing psychological profiles to determine the scale of measurement for mental health behavior which can easily generalize to real estate investors not to discount our stress levels trying to locate "motivated sellers." So much so that I have started writing a book (everybody seems do that...these days, LOL); but this is from what I have observed in human behavior proper and whether real estate investors can take the information and use it in their marketing (e.g., a survey to pre-qualify the owner/seller).
The index was created by other psychologists so I do not take credit for the psychological instrument. However i have used this scale to determine not only my stress level (e.g., public speaking) but stressors in my studies with mental health impact everyon as a "life change." Since I plan to write the book for this area; I will not give the whole content away but I will identify the internal and external factors that contribute to stress and how that might impact on the owner/seller and/or investor as a two pronged approach to reduce the mitigating factor as before and after conditions.
The Percentage of Those Impacted By Stress
Stress these days are shocking.77% of adults report regularly experiencing physical symptoms caused by stress, and an estimated 75% to 90% of visits to primary care physicians are stress-related. WOW!
What is stress from a psycho-biological perspective ?
The hormones released when you feel stressed, such as cortisol and adrenaline, put your body into fight or flight mode. Activity in the advanced decision-making part of your brain (the prefrontal cortex) is reduced, and your immune system and digestion are inhibited. Basically, if you need to escape a predator, you’re good to go, but any ability to make complex decisions is extremely crippled. And while it’s fine for your immune system to sit on the sideline for a single play, serious trouble can arise when it’s out for the whole game. High and prolonged levels of cortisol cause negative symptoms,
I am a former diabetic but I still have high blood pressure so stress can contribute to these biological conditions: heart disease, high blood pressure, diabetes, depression, anxiety disorder, and other illnesses
What are stressors in the immediate environment?
Most people identify the stress in their lives as something outside of themselves that they have no control over. The top two reported causes of stress are work and money – not things you can easily avoid. Read that again, though, and note the phrases “causes of stress.” Things that cause stress are “stressors,” and stress is your personal reaction to those stressors. That’s why what stresses some people out is a piece of cake for others!
So how does knowing the difference help?
To paraphrase Einstein, you can’t solve a problem on the level of the problem. It’s impossible to avoid all stressors – sometimes you don’t even know what they are until they hit you in the face – but you CAN affect your reaction to stressors. I’m not talking about “taking a step back” or “pausing to breathe.” Both are good advice, but easier said than done in the heat of the moment!
The Real Estate Investor and the Life Change Index Scale (The Stress Test) to scientifically and systematically determine the motivates seller (future title of the book)
Event Impact Score and the Score of the Owner / Seller
Death of spouse 100
Divorce 73
Marital Separation 65
Jail Term 63
Death of close family member 63
Personal injury or illness 53
Marriage 50
Fired at work 47
Marital reconciliation 45
Retirement 45
Change in health of family member 44
Pregnancy 40
Sex difficulties 39
Gain of a new family member 39
Business readjustment 39
Change in financial state 38
Death of a close friend 37
Change to a different line of work 36
Change in number of arguments with spouse 35
Mortgage over $20,000 31
Foreclosure of mortgage or loan 30
Change in responsibilities at work 29
Son or daughter leaving home 29
Trouble with in laws 29
Outstanding personal achievement 28
Spouse begins or stop work 26
Begin or end school 26
Change in living conditions 25
Revisions of personal habits 24
Trouble with boss 23
Change in work hours or conditions 20
Change in residence 20
Change in schools 20
Change in recreations 19
Change in church activities 19
Change in social activities 19
Mortgage or loan less than $20,000 17
Change in sleeping habits 16
Change in number of family get-togethers 15
Change in eating habits 15
Vacation 13
Christmas approaching 12
Minor violation of the law 11
Total
Directions If an event mentioned above has occurred in the past year, or is expected in the near
future, copy the number in the score column. If the event has occurred or is expected to occur
more than once, multiply this number by the frequency of the event.
Scoring The Life Change Index
The body is a finely timed instrument that does not like surprises. Any sudden change
stimuli which affects the body, or the reordering of important routines that the body
become used to, can cause needless stress, throwing your whole physical being into
turmoil.
The following chart will give you some idea of how to informally score yourself on Social
Readjustment Scale. Since being healthy is the optimum state you want to achieve, being
sick is the state of being you most want to avoid.
Life Change Units Likelihood Of Illness In Near Future
300+ about 80 percent
150-299 about 50 percent
less than 150 about 30 percent
The higher your life change score, the harder you have to work to get yourself back into a
state of good health.
T.H.Holmes and T.H. Rahe. "The Social Readjustment Rating Scale," Journal of Psychosomatic Research. 11:213, 1967.
The Take away: we work with numbers, we earn numbers; we can learn by numbers "show your owner / seller his / her level of stress and why stressors can impact on thie health which is our ticket to wealth and that as the real estate investor who wears the white hat we become the voice of reason no selling, no telling, no yelling the owner/seller has enough stress in their lives. Hope this helps to identify the motivated seller.
