Avoid Five Real Estate Regrets
Can you tell good real estate advice from bad?
Unfortunately, for buyers and sellers the answer is usually, “Yes, in hindsight!” That is, after they have bought or sold.
After buyers move in or sellers move out, many things become clear. Buyers and sellers begin to discover whether the advice they followed—from family, friends, social media, how-to’s…—was the best advice to act on.
I have always believed that a type of stress-driven “temporary insanity” can descend on buyers and sellers. This is especially true if they put extra pressure on themselves by searching for a “dream or forever home.”
Clear thinking, capable individuals become frazzled. They are caught in a high-pressure vortex of unfamiliar real estate decisions, most of which must be made quickly and often without knowing or understanding all the implications:
• This is particularly true for sellers who are attempting to decide whether to let go of the home they love and at what price, often without knowing exactly what will be next for them.
• Buyers, especially first-timers, are frantically trying to project their lives into someone else’s home, under time pressures and without really understanding all that’s involved.
The most common hindsight regret and disappointment for buyers is “the one that got away”—the real estate they could have bought but didn’t.
These unmade decisions haunt some people for decades. Avoid hindsight regrets with foresight:
The 5 Most Common Hindsight Regrets
Regret #1. That we didn’t buy the house beside or behind ours, or both.
We’d have had an undisturbed view, privacy, and an amazing pool-sized backyard. The resulting large real estate holding could have set us up financially. Instead, we have a huge new house towering over ours—this is often the result when new neighbors renovate. “If only we’d…” regrets are no solution to not acting when opportunities arise.
Regret #2. That we began the search for a seasonal home, then got distracted, and nothing happened.
We keep kicking ourselves for not following through and buying that wonderful get-a-way. Now, vacation properties have climbed in value and may be out of reach. Hesitation undermines many buyers.
Regret #3. That we compromised on permanent, physical real estate characteristics to buy a property for its trendy, cosmetic features.
Letting go of a dream, like buying a detached home or a preferred location, cannot be reversed. Choosing a property because of “must have” fashionable decor features like open concept or a dream kitchen can represent short-term thinking. These features will wear out and go out of style; location and neighborhood values usually keep appreciating.
Regret #4. That we got swept away in a bidding contest and paid more than we intended.
That extra money could have bought us a different property which would have put us in a better home or a better neighborhood. Now that regret has materialized as a larger mortgage.
Regret #5. That we waited for prices to drop back to “normal” when, in our ever-changing world, that “normal” is now “history.”
When sellers become buyers, they may end up with similar regrets. If they don’t apply forethought based on evaluating the success of their last purchase, they may find additional “history repeats itself” regrets in their next purchase.
Sellers can have “selling” regrets
Some sellers may get swept up in a hot market, without much thought about where they’ll live next. This same hot market can turn on them, so they don’t have as much purchasing power as they expected. They may regret they sold if they have to settle for less in their next home. Buying before you sell can make sense when listings are scarce and you have specific demands.
Not taking the time to calculate what you’ll net out of the sale, after all expenses, including real estate commission and legal fees, can be a big regret. This is especially true if the seller zeros in on price and picks the highest sale price out of the multiple offers. Fixation on sale price can lead to regrets about expenses related to transition housing or storage necessary to meet the closing date, replacing what was included in the sale, and/or the “close-ability” of the buyer if the deal falls through.
Regrets at turning down an OK offer—perhaps the only one received—because the seller and the buyer were a few thousand apart. Sellers may regret that they did not encourage their or the other real estate professional to find a way to “make it happen.” A seller may regret they had not been asked to hold a no- or low-interest second mortgage (a VTB or vendor-take-back mortgage) for the buyer. This would have closed the financial gap so the home sold at the seller’s price. This mortgage may be sold later to give the seller cash in hand.
Regrets are a waste of time and money!
Your real estate professional’s job is not to tell you what to buy nor to tell you when to sell. Their function is to provide accurate real estate information, dispel misinformation, access available real estate listings and data, and follow your instructions. Professionals are there to explain the real estate transaction, expedite the buying or selling process, and help you achieve your desired results or get as close to them as the market and location allow. They can help you clarify your thinking, consider new alternatives, and confirm your priorities.
It’s up to you to take full advantage of this support to avoid regrets and achieve a real estate outcome you can live with.
-Courtesy of PJ Wade, RealtyTimes.com, 3/26/23