The One that Got Away
By Diane Saatchi
When most people think back to the one that got away, they think about relationships.
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I think about real estate.
After 30 years of selling real estate, I’ve seen more instances of homebuyers and sellers getting fixated on the one that got away than you’d think. For buyers, it could be that perfect three-bedroom water front cottage that was snapped up the day after they viewed it; for sellers it’s that close-to-but-not-quite-the-listing-price offer that seemed too low at the time, but no one has offered to match since.
In cases like these, the one that got away isn’t just a quiet reminiscence — it’s a shadow that falls over the months and even years to come, making it difficult if not impossible for would-be buyers or sellers to find something that measures up to what they had, or thought they had, before.
I’ve written before that real estate deals are wrought with emotion [Unpacking Emotions], because most people aren’t buying or selling a house. They’re buying or selling a home. On the surface, we are dealing with the sale and purchase of a product, but in actuality, we are trading the sellers’ memories for the buyers’ dreams, along with the associated baggage.
In fact, particularly in the buyers’ case, the feeling that the house you didn’t get is the only house you could love is almost entirely emotional. Practicality might go right out the window. For one thing, buyers regularly respond to decor (which is why staging is so important, but that’s another conversation [What to Expect While Selling Your Home]. Perhaps a buyer will come to me with a non-negotiable requirement for their next house, like a bathroom for every bedroom, or enough space upstairs to accommodate six grandchildren at a time. But when they start looking at available houses, they fall in love with one that has nothing resembling their “non-negotiable” needs yet looks like somewhere they could “see themselves.” They keep looking, but if the house is snapped up by someone else they’re devastated: It’s the one that got away.
But if you ask me? In many cases, they may not have bought that house even if they could have. There’s a reason they didn’t make an immediate offer, and a little more thinking probably would have made them realize that their non-negotiables were non-negotiable for a reason: They needed them!
Plus, that house most likely wasn’t as incredible as they remember. Over time, buyers idealize it until they’ve completely forgotten about the reasons why they stalled.
And to be really frank, sometimes it’s easier to have a house that “got away” than not — it’s a built-in excuse not to take the plunge into buying a house and throwing your life into upheaval, what with financing, closing and moving. A perfectly suitable house currently available just doesn’t have the magic something that was unique to the house that got away. If they aren’t truly ready for the next house, they can put off buying indefinitely without having to decide they do not want to.
The commonality of the house that got away comes from the fact that many buyers are always looking over their shoulders: How do we know this is the best house we can get right now? How do we know something better won’t come along? What if we go into contract, and then the perfect house presents itself? Apparently, this is very common and is not only a real estate related condition. Just last week, there was an article in The New York Times [How to Make Tough Decisions Easier] about the fear of better options (FOBO). It’s a phenomenon. Who knew?
We’ve been talking about buyers and the house that got away, but there’s the other side, too: For sellers, there’s the offer that got away.
To understand why the offer that got away can be so problematic, I’m going to tell you something I regularly tell my clients: The value of your house is determined by what a buyer is willing to pay for it. [How to Understand What Your Property is Worth]
Bear in mind that a listing price is an estimate of value at a moment in time. It is not gospel. In real estate, we often say sellers wish for a price, brokers guess a price, but ultimately it is the buyer who establishes the price. Listing prices do not exist in a vacuum. Markets, economies, competition and other factors influence value, rendering even yesterday’s price too high or too low.
Sometimes, a seller will get an offer that seems too low. But fast forward a year, and they’ll wish they had taken it. Or perhaps, they did accept the offer, but the deal fell through. Now, they’re convinced that offer established the value.
I have to tell sellers pining after previous buyers two things: First, an offer is not a deal if it didn’t close. All we know now is that someone didn’t buy it at that price. Second, markets are not static. They change, and the best we can do is get a deal at today’s market value, which has little to do with the market value of a few months ago. The market is the market, and no matter how smart or clever people are, they can only buy or sell at market value. It’s the buyer who decides the price.
As I said before, we’re trading in homes, not just products, and all of the emotions that come with it. But just like idealizing a lost love holds you back, so too does dreaming of the perfect real estate deal.
© 2018 Diane Saatchi