Buyer’s Remorse

Are home buyers sorry? A recent Trulia survey suggests that they often are. Sorry they didn’t buy a larger (or different) home. Sorry they allowed fear to persuade them to rent when buying would have been a better economic decision over the long term. Sorry they didn’t know more at the time that they bought, so they could have made a better decision. Sorry they didn’t renovate more. Or less.

No app replaces expert advice. Good agents, however, can help manage up front the issues that can lead to buyer’s remorse later on. In each of the above described situations, and many others as well, the best agents resemble psychotherapists: listening closely to the buyer’s desires, hearing the wish (or the wish behind the wish) and interpreting their own information back to them in a form which crystallizes priorities. Let’s look at a few of the most common issues below:

  • HOME SIZE – Very often buyers begin their searches with a wish list which more closely resembles a dream list. A critical part of the agent’s job involves helping to shape this list into a solid set of priorities. Almost everyone wants as much space as their money can buy them. But they may only obliquely perceive just how impactful other factors like location and amenities can be in determining how much space they can afford. Over the years I have worked with a number of buyers, for whom space was key, who decided to forgo the Park and Fifth Avenue co-ops for East End Avenue or Sutton Place, where their dollars bought them much larger homes. Similarly, in today’s market few people have the energy to renovate. So buying a fixer-upper stretches buyer dollars.
  • PRICE – This issue, critical to both buyers and sellers, involves a complex calculation of multiple factors. For sellers, the cosmetic appearance of the property has enormous significance in determining outcome. Even a totally unrenovated property benefits greatly from a substantial decluttering, a coat of white paint, and some neutral furniture which give it a more pleasing and open appearance to buyers’ eyes..And for buyers, the most common long term issue is whether to spend more to buy more. Especially for young couples, I have always advised that they stretch their budget to the max to buy the largest space they possibly can. That choice doesn’t mean that they WON’T move, just that they can often postpone for years (and maybe forever) the feeling that they MUST move.
  • RENT VS BUY-I don’t understand anyone who makes a long term decision to rent rather than buy if buying is an option for them. Home ownership still provides the single greatest source of wealth creation ins this country, regardless of location. The Trulia survey highlights something I observe anecdotally every year of my life: those who did not buy almost always regret it.
  • RENOVATION – According to the survey, new owners regret both renovating too much and not renovating enough. The advantage of the latter, of course, is that it can be remedied. I usually advise buyers, as I indicated above, to buy the best possible property they can, even if that means postponing renovations. My wife and I redid our kitchen a year after we bought our apartment, but it was another 20 years before we renovated our 1929 bathrooms (and renovated our kitchen again!). It’s a great apartment, though!

In my experience, a well-informed, judicious buyer rarely suffers from regret. A skilled agent who sees the critical points and those which can be relegated to a lesser position can provide significant guidance . A careful purchasing plan including “where”, “when”, and “how” will reduce the likelihood of second guessing the final choice. No one should regret such a big decision!

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