NOTE: This information is part of a forthcoming book, the Gotcha Guide™ to Buying and Investing in Real Estate.
by DeeinAustin™
I spoke to some investors yesterday about how understanding buyer psychology and staging homes can save them money. I explained that I had several designations, which they probably could care less about, but through the process of obtaining them, agents are taught "best practices". For instance, the Graduate REALTOR Institute, National Association of REALTORS, and Council of Residential Specialists have done decades of research on all aspects of the real estate transaction.
They ask: what are buyers looking for in a home, what helps them choose the home they purchase, what motivates a seller, what's the best home buying or selling process to follow, what are the most cost effective repairs or remodeling projects, etc. These organizations make home buying, selling, and investing a science, then provide this data to us for free or through certifications.
One of the areas where I see sellers or out-of-town investors lacking knowledge is in aspects of preparing a home to sell. New Home Builders stage their properties because they know that a good-looking, showcased home will get you top dollar. The buyer can more easily see themselves in the house and will also often overlook small flaws.
In the case of the investor I was speaking with, their painter had painted over door knobs, ceilings, shelving, even wall plates. The house had not sold as fast as they had hoped, so I was there to offer advice. I told them about the numerous small issues such as not painting the inside of a closet, not putting down new sod, or replacing rotted wood under the sink.
I summed up the buyer experience in this way, "When a buyer is walking through their potential home, it's not just a house. It is where they will raise their family and enjoy special moments. They want to walk in and be wowed. Buyers have a move-in condition form in their mind and if they see a great deal of obvious, noticeable, small flaws, they wonder what else is wrong. You have to earn their trust that they can move in and the house won't fall apart the next day." In this case, I'd suggested they purchase a pre-inspection to help the buyer understand that they did their homework. They could have also fixed small issues and staged the home.
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