The Urgent Sales Curse
The sense of urgency can be important in emergencies and deadlines. It becomes a curse however when it comes to other things, such as selling a home. When there is urgency in this situation, it can lead to:
- accepting a low offer
- agreeing to conditions you don’t want to
- not getting the profit or income desired
- losing home value
Merriam-Webster defines urgency as “a force or impulse that impels or constrains”. It is a DESIRE that can actually restrict us. Real Estate investors and real estate flippers are looking for people who have this urgency curse when selling a home because they can benefit from the deal. They take the situation that has created a gap between the terms created from the urgency, and wait it out to get the benefit. Here’s a quick story to better explain.
If you have to sell RIGHT NOW
John and Mary were getting a divorce and they had debt tied up in their mortgage and neither was staying in the home, so wanted to sell the house FAST so neither had to make another mortgage payment. They put it on the market and on the third day, they received an offer for $20,000 below the $250,000 bargain asking price and accepted it because they just wanted out. They both would have liked additional income so they could have a little more to build their separate houses with, but they thought having the home sold was more important. They accomplished their goal of ‘getting out’ of the mortgage, but they allowed the curse of urgency to run the decision making. Bottom line: $230,000. A better scenario would have been:
John and Mary have a Realtor offer a fair market value on the home and make suggestions for any repairs that can add value. The home is staged and great photos are taken. These additional steps added 3 days and $2,000.
Together, John, Mary and the Realtor discuss and decide what the real (not perceived) timeline is for when the home needs to sell. Certain time frames are better to sell a home due to inventory levels and the Realtor speaks to them about that, and decide it is a good time to sell. Based on other homes in the area, they priced the home for a fair price of $265,000. In three days, they received an offer for $10,000 below asking price and decided to wait it out a bit longer. Seven days later, they received an offer for $5,000 below asking price and 2 days later received an offer for asking price, which they accepted. Bottom line: $263,000.
A minor adjustment saved $33,000
In this example, by making a few minor adjustments and allowing a bit more time resulted in $33,000 additional income. And, if in the original scenario, if a Real Estate Investor had made the purchase, they just made that $33,000 without much more than a few hours of time and a bunch of paperwork. Of course, this example is hypothetical but similar to ones I see all the time. Even in the second scenario, with good photos, staging and minor repairs, if John and Mary would have accepted the first offer, they would have still made $23,000 more than in the first scenario.
I see homeowners get hit with this curse in these situations:
- Loss of a job
- Death of a loved one (downsizing/painful memories)
- Inherited the house in some form
- Financial distress
- Major Lifestyle change
Don’t get sucked into the curse of urgency. Financially, the cost of doing so can be more than you know. There are many situations that make us feel like we need to get out now, but many times, this is a perception and not a reality. Together, we can discuss your unique situation and discover together the benefits of acting quickly versus giving it a little more time.