If every agent would post the Top 3 Mistakes they actually see home buyers make in the real world, we would have an excellent list for people to use.
Yesterday I gave my $.02 on the Top Ten List of mistakes “first time buyers” make that’s been floating around the internet. But I can’t honestly say I saw the real mistakes people make in that list. I also don’t like the idea that “first time buyers” make more mistakes than 2nd time buyers. Not necessarily so. In fact 1st time buyers are more likely to spend lots of time making sure they aren’t making mistakes. 4th time buyers may not be paying enough attention to changes that took place since they bought their last home. So being careful not to make “mistakes” is not only for “first time” buyers.
Here’s my view of The Top 3 mistakes I see buyers (almost) make:
1) Starting out with the wrong attitude.
It’s a big decision. Starting out with the right attitude for “home shopping” is very important. Knowing your own strengths and weaknesses will help you select an agent who complements you best. Sometimes finding an agent you disagree with more often than not, will give you the right balance.
Ms. Happy Face often likes everything and never likes to say anything bad about anyone or anything. If you can’t change to Ms. Objective and Discerning, find an agent who looks for all the bad stuff for you. Biggest mistake Ms. Happy Face can make is having an agent who is always happy, happy with her. We all like our “YAY-Days”, but best to save YAY Day for “loan docs are at escrow” day, and not every house you go to see.
Mr. Sad Face is often too sure that the house he buys isn’t going to make him happy. The fact that nothing is perfect is too embedded in his psyche. Biggest mistake Mr. Sad Face makes is he often ends up sucking up defects as “oh well, they all have defects” and doesn’t make the right list of priorities as to acceptable vs. unacceptable defects. Mr. Sad Face is best served by an agent who will list all the pros and cons of the home he selects, both before and after home inspection, and separates “normal” defects from “abnormal” defects. Otherwise they tend to get all lumped together and overlooked in their entirety.
Mr. Angry hates the process. He hates that he has to use an agent. He hates agents. He hates that the process isn’t more simple so that he can proceed without an agent. He hates it if the agent is stupid. He hates it if the agent doesn’t know more than he does. He hates it if the agent thinks they do know more than he does. He hates having to talk to so many different people during escrow. Mr. Angry isn’t happy until it’s all over and behind him and he can sit down and watch his TIVO in his new home. Mr. Angry would be best served by delegating everything except choosing the house to someone he trusts. Finding someone he trusts is the hard part 🙂
Mr. and Ms. Objective and Discerning are of course the model for Right Attitude. Their glass is not half full or half empty. They empty their glass before each home, and look at each home’s particular strengths and weaknesses each time anew. They narrow their choices down to the top two or three, and then they compare those one to another. In the hot market, these nice people were pressured by the “quick sales” and not having enough time to apply their best judgment. But in this market, Mr. and Ms. Objective and Discerning will thrive and be successful and happy with their choices.
The alternative to BEING Mr. and/or Ms. Objective and Discerning, is to hire Mr. or Ms. Agent who is Objective and Discerning.
2) Spending too much time on WHAT and not enough time on WHERE.
Everyone knows someone who moved fairly quickly after they bought their home. Now go ask them why they were unhappy. Chances are they were unhappy with WHERE vs. WHAT. Before going to Open Houses or talking with a lender or an agent, spend lots and lots of time finding the “Where of Happiness” for you. Buying where you are currently renting and happy, is good. Renting at another where before you buy there, is good. Renting in your percieved best where before you buy there, is the best advice I can give on this one.
3) Not being selfish enough.
This problem is more about couples that are buying than single people. The Red Flag that you may be in this category is if you say to the agent “We always agree on everything”. No one always agrees on everything. BE SELFISH! Don’t factor in what you think your spouse may or may not like, when you are evaluating homes. Make your own separate list of pros and cons, and make sure they are All About YOU.
If you aren’t selfish enough, one day you may wake up to find that neither one of you really liked the house in the first place 🙂
Ardell, nobody has comment on your original artwork, so I will! Well done!
LOL, Greg. Thanks!
I took some classes many, many years ago on how to be of better service to people by complementing the client’s strengths and weaknesses. We had a cube on our desks to turn to the client’s natural mindset, so we would know how to best help them.
Mr. Worried (not pictured here) likes lots and lots of supportive documentation 🙂
LOL, Greg. Thanks!
I took some classes many, many years ago on how to be of better service to people by complementing the client’s strengths and weaknesses. We had a cube on our desks to turn to the client’s natural mindset, so we would know how to best help them.
Mr. Worried (not pictured here) likes lots and lots of supportive documentation 🙂
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Great post! Not only have you pointed out the things that you dont like, but you went a step farther and explained what kind of client you like working with best. Anyone can complain, but it really takes it a step farther when you offer constructive critisizm.
Portland Real Estate,
It really bugs me that you don’t use your name. Hard to respond to a market.
It’s not that I don’t “like” Ms. Happy Face and the others. Who wouldn’t like Ms. Happy Face? Everyone likes Ms. Happy Face. Her co-workers, strangers, her friends…it’s not about what kind of client I “like” or don’t “like”.
This is about the way agents complement the strengths and weaknesses of their clients. About not letting Ms. Happy Face buy a property without giving her a good list of the properties weaknesses, given her natural disposition could lead her to overlook some real problems.
I’ve seen Mr. Sad Face more as a seller than as a buyer. You go to list the home and you see all kinds of things wrong with the property. You recommend he fix them before putting the home on market and the answer usually is “It was like that when I bought it.” The fact that he chose to shrug his shoulders and say “Oh well, to be expected.” when he bought it, doesn’t mean the buyer this time around should do the same.
We all run into Mr. Angry at Open Houses from time to time, but rarely do we see them as actual clients. When I do accept them as a client, it’s important to recognize their discomfort with the process, to help alleviate some of their stress. They often lash out at their agent, and even their wives, when the real anger is about the process. Understanding that helps make one a better agent and resource for a person like that.
We can’t remove emotion from the process, but we can be the one that helps keep the emotions on the sidelines, and helps the client focus on the important matters at hand.
A great helpful post. I think I’m Mr. Worried.
Hi Colin,
The most important & helpful service an agent can give to Mr. Worried is approaching each and every “worry point” from more than just one angle. Checks and double-checks and always in writing, so he can read it over and over again both before Mr. Worried makes an offer, and again while he is in escrow.
The worst agent for Mr. Worried is an agent who just says “don’t worry about it” 🙂
The Anatomy of a Real Estate Transaction link in my most recent post about “loan docs” should be of value to you, unless you are more worried about the buying part than the escrow part.
Mr. Worry tends to get 10 different answers from 10 different places, and then he has trouble deciding who to believe, and worries that he chose the wrong person to believe. Choosing the right agent before it is too late to switch, should be Mr. Worry’s #1 worry. 🙂
Mr. Worry not to be confused with Mr. Fear of Commitment. Two totally different scenarios. Mr. Fear of Commitment knows everything…absolutely everything…he just sweats profusely when his “legal out” phases are gone.
Hi Colin,
The most important & helpful service an agent can give to Mr. Worried is approaching each and every “worry point” from more than just one angle. Checks and double-checks and always in writing, so he can read it over and over again both before Mr. Worried makes an offer, and again while he is in escrow.
The worst agent for Mr. Worried is an agent who just says “don’t worry about it” 🙂
The Anatomy of a Real Estate Transaction link in my most recent post about “loan docs” should be of value to you, unless you are more worried about the buying part than the escrow part.
Mr. Worry tends to get 10 different answers from 10 different places, and then he has trouble deciding who to believe, and worries that he chose the wrong person to believe. Choosing the right agent before it is too late to switch, should be Mr. Worry’s #1 worry. 🙂
Mr. Worry not to be confused with Mr. Fear of Commitment. Two totally different scenarios. Mr. Fear of Commitment knows everything…absolutely everything…he just sweats profusely when his “legal out” phases are gone.
Colin,
Also, Mr. Worried needs some guidance on what to worry about. Often Mr. Worried misses something he should be worried about, while he is too busy worrying about something he shouldn’t be worried about. There are only so many hours between offer accepted and legal outs gone, and spending that time on the wrong things should be your biggest fear.
The Anatomy post also breaks things down into Phase 1, Phase 2 and Phase 3. Staying “in phase” is the best advice I can give you. Worrying and talking too much about Phase 3 items can lead you into missing something in the all important Phase 1.
I may move getting home owner insurance into Phase 2 for the buyer. It used to be faster and easier to get than it is these days. It shouldn’t be in Phase 1 though, but likely 2 vs. 3.
Yes, the docs post was great. There’s an interactive timeline graphic to be made out of it.
A good agent or lawyer can provide the backup needed in the deal-completing process. I worry more about the long-term costs of operating and maintaining a house, since that’s far from transparent at the buying moment. That means at the least that inspection had better be good and show evidence of long-term TLC, not just last-minute painting and patching.
Yes, the docs post was great. There’s an interactive timeline graphic to be made out of it.
A good agent or lawyer can provide the backup needed in the deal-completing process. I worry more about the long-term costs of operating and maintaining a house, since that’s far from transparent at the buying moment. That means at the least that inspection had better be good and show evidence of long-term TLC, not just last-minute painting and patching.
Colin,
I have not had good luck with timelines for real estate transactions, as often the times change by event.
For example. On day one I know you have 10 days to deliver your inspection response, seller has 3 days to respond to that and you have 3 days to respond to his response.
Some clients like to put that into a timeline, but it creates more confusion and room for expensive error.
Say 10 days equals May 10th, then 3 days from that = May13th…not so.
If the buyer responds in 6 days, then the seller’s response is due maybe on the 9th and maybe on the 11th.
What you have to do when, is a moving target. The seller has 3 days from receipt of buyer’s request, not 3 days from the 10 days in the contract. Also, 3 days does not include weekends and holidays, but 10 days does (6 or more does) so 10 days = calendar days, but 3 isn’t calendar days. So if you respond on a Tuesday, the seller has to answer by Friday. But if you respond on a Thursday, the seller doesn’t have to answer until Tuesday.
Since several of the timeframes begin as a result of an event that happens during escrow, it’s often misleading to boil all of the times into a calendar timeline on day one.
First-time homebuyers need alot of hand holding. One of the biggest things I see is that they haven’t thought out their towns based on their needs for work, schools, etc. So, they want to look all over the state which doesn’t make sense. A good agent will have to work at educating them to take the appropriate steps first and guide a focused search in towns that make sense for their life-style.
Susan,
Sometimes they need to have several agents so they can research different areas on their own, before selecting one of those agents to be their buyer’s agent.
An agent “educating them” as to where to live, is a bit old school.
Yes Ardell I agree on having several agents for different areas. Let me clarify that they are not moving from out of state, so have a general idea. I sometimes speak with couples that say they have been looking for a home for a year. To me there is something wrong there.. I don’t think narrowing down a town based on location/work needs and schools is old school, but focused. Then its important to get into the style home, etc. … IMHO…its working smart.
Susan,
In your comment #11 you said they were “looking all over the State”. Anyone looking all over the State, or in different states, often take much more than a year of looking before deciding what to do. People who are retiring is a good example.
You say “working smart”, but why isn’t looking for a year or more a “smart” thing for a buyer to do? You lost me there.
All over the State “figuratively speaking”. I don’t think its working smart if you’re wandering around without having given thought to schools, town proximity to work, etc. if these issues are indeed important to the buyer.
Susan,
Sounds like you have a particular client in mind 🙂 I’ve never heard of someone who didn’t consider distance from home to work, though some are willing to travel further than others, depending on their other needs.
If someone needs that much “hand holding” per your comment #11 and has no idea where they want to live, they should rent for a year or more before buying, so they have plenty of time to give due consideration to all of these factors. Rent where you think you want to live…try it out first, is often a pretty good idea.
Susan,
Sounds like you have a particular client in mind 🙂 I’ve never heard of someone who didn’t consider distance from home to work, though some are willing to travel further than others, depending on their other needs.
If someone needs that much “hand holding” per your comment #11 and has no idea where they want to live, they should rent for a year or more before buying, so they have plenty of time to give due consideration to all of these factors. Rent where you think you want to live…try it out first, is often a pretty good idea.
I find that first-time home buyers need alot of “hand holding” and/or educating on the process, things to think about right up front. I believe they are overwhelmed and do not know where to start on top of being very nervous about financials. Its understandable.
Susan,
Here’s a link to a long and color coded description of what happens “in escrow” that my clients have found to be helpful in demystifying the process.
http://www.realtown.com/Ardell/blog/the-escrow-process/ardells-anatomy-of-a-real-estate-transaction
Not 100% relevant to your NJ closings, since you don’t have escrow. I had a different version when I sold real estate in NJ where you have “settlements” vs. escrow closings, but that was a long time ago and I haven’t kept it.
It’s about time for me to revise it, so if you have any suggestions based on your client experiences, feel free to post them here.
The more information we can get out there online, the less people will feel “overwhelmed” and in need of being dragged through the process by the hand.
Maybe we could all be better agents if we took some psychology classes?
Learning how to ask questions and actually hear what the client is saying…
But seriously, the best agents do “read” their client’s personalities and adjust for the person that they are meeting. Thus making a sale!
Maybe we could all be better agents if we took some psychology classes?
Learning how to ask questions and actually hear what the client is saying…
But seriously, the best agents do “read” their client’s personalities and adjust for the person that they are meeting. Thus making a sale!
Hi Doug,
You should have stopped at “meeting” 🙂 Sometimes the best result at the end of a client meeting is to recommend something that does not “make a sale”. We reserve ! for client success items, and rarely do buyer clients “make a sale”. Sellers, yes; buyers, no. Buyers make a purchase, not a sale.”
I think your agency laws are a bit different. Here in WA, all agents represent the buyer at first contact, except for the one and only agent who represents the seller. So most agents here are not in the business of making a “sale”.
1)They think that there must be a better house worth their consideration, then the first one they liked.
2)They think that need to low ball a seller to get a good deal.
3)They think that because someone they trust gives them advise, on real estate, they must be right.
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