Some purchasers are conservative by nature or have a very risk-averse temperament perhaps exacerbated by their occupations or their behavioral profile e.g., Accountants, Lawyers, and Engineers. This can be great for proceeding with caution and ticking all the boxes. However, more often than not making sure everything is perfect can also be a mask for indecision and inaction.
I have seen this transpire into missing some valuable and ‘safe’ opportunities.
It becomes a case of “He who hesitates is lost”. No property or situation is 100% perfect. Nor is the paralysis of analysis going to improve your execution speed. Sometimes it takes and softening of stringent requirements or acceptance that the ‘ideal’ property for the property may not tick every box of their requirements. Alternatively, by the time they are comfortable that the house is the best match to their requirements and timing… the property has transacted at a higher price or outside of their budget parameters.
This hesitancy falls into two categories – not understanding the value proposition of the property (not just price-focused) and then not performing adequately in the Execution process. These are key areas where property purchasers fail. I can help clients change this dynamic.
How can this dynamic be changed? By providing these temperaments with a process and methodology they can become comfortable with the due diligence process and manner of how the transaction will be conducted. I create a Strategy Road map that visually shows the price expectations and ranges of the property identified throughout the process. This enables informed decisions to be made with the knowledge the value is well understood and researched.
This process assists in execution however it doesn’t help these temperaments to fast-track their property selection process. A client needs analysis is essential to understand what these buyers truly want and don’t want. I often find many purchasers don’t know what they want until they see a property that engages them. Quite often it is the ‘left field’ property that ‘wins the day’ yet it was different from the initial brief. Using a process and methodology to source and select the property can be a major assistance, as with providing a decision matrix – however, it will always come to emotionally engaging with the right property when it has ticked the essential requirements.
I have on numerous occasions seen purchasers determine the value of a property but with a confirmation bias relative to their budget versus what the market is indicating or performing to. Quality property will always be desirable and have competition. The need to apply such logic to transactions can be crippling for these buyers. Some people recognise this as an issue while others will simply deflect and state “The property isn’t suitable” or the “property was overpriced” more as a justification for not being able to decide or commit and often regretting this later.
Getting the right property is important. Understanding your limitations and strengths is also paramount when purchasing a property. Perfect is not always in the market, and when found it is often not aligned with the real budget.
Navigating some of these issues can be done by developing a rating system for all things being considered for the new property. I start with the top 3 ‘Must haves’ and then the top 3 “Not Negotiables”. Then rating different features of the house including overall liveability, walk score, commute score, quality of light, layout etc.
Applying a rating process over time will push the buyers into understanding more about what they want, what they will need to acquire it, and what it may cost. This is because they are benchmarking their requirement against the physical property, and it clearly shows any gap in what they seek. The ideal is finding the best property that closes this gap. No properties are identical and each will have a nuance or difference that can be attractive or detracting. Being pragmatic about this and using a Scorecard (decision matrix) can focus your searching and your decision-making capability.
At the end of the day, everyone is different and every property is different. By developing systems, and processes for tools to help find, assess, and decide on the right property.
Need help refining your process and decision-making?…
