Buyer’s Remorse, we’ve all had it—that stab of regret that hits about 24 hours after we’ve made a major purchase. It’s bad enough when you get it yourself. But when a client calls you in a panic the day after closing—that’s a scenario you want to avoid at all costs. Aside from the emotional and psychological impact of buyer’s remorse, there are also legal implications to consider. So let’s take a closer look at this issue and see how to keep our clients from falling into the abyss of regret.
- Identify the causes
- Manage expectations
- Be available
- Follow up
Identify the causes
There are many factors that can create buyer’s remorse. To begin with, your buyers may not be totally clear on their own wants and needs. For example, they may be distracted by a property’s overwhelming positives (a sensational view of the lake) and overlook what they really need (a fenced yard).
Given today’s volatile market, they may worry that they are buying at the wrong time, and that by waiting they could make a better deal. On a more psychological level, buyer’s remorse may show up as extreme guilt over the purchase itself—people wonder if they really need, deserve or can afford the home. Last but not least, they may express a big concern for how others will see their decision, especially if they are sometimes thought of as frivolous or accustomed to using bad judgment. “What will my mother / sister / cousin / boss / best friend think?”
You can prevent a lot of the emotional angst over buyer’s remorse by managing the buyer’s expectations throughout the process. Start by helping the clients put their wants and needs in writing. Then you can make sure you’re showing them properties that meet all their must-haves. Or at least while they are oohing and aahing over the lake view of a home they found online, you can point out that the house is clinging to the side of a cliff with no visible yard, let alone a fence!
Today’s market demands constant vigilance. The old stock market adage of “buy low, sell high” is present in real estate too. Timing is everything and everyone hopes to hit the bottom of the cycle when they make their final offer. Your job is to stay up to date on local trends and price reductions, as well as the seller’s bottom line acceptable offer. Provide your clients with frequent updates and utilize all your skills to manage the offer/counter-offer process for a positive outcome.
In terms of the more subtle psychological aspects of the buying process, encourage open communication, both between yourself and the clients and between the clients and other interested parties. Paint a visual picture of what life will be like when they are actually living in the home, enjoying the environment they are creating. If family or friends have concerns, offer phone conferences, virtual video tours for out-of-towners, or in-person showings if needed.
The closer you get to closing, the more available you need to be for the client. If you’re lucky, the buyers are already prequalified and are purchasing a home within their price range, with no contingencies. But that best of all possible worlds doesn’t always happen and there may be bumps, if not outright boulders, in the middle of the financing road. Be prepared to discuss and explain every detour, and to suggest alternatives if necessary.
It’s never over until it’s over. Even after closing, clients may still get a bad case of the morning-afters. This is where prompt and thoughtful follow-up is critical. If they call you in a panic, be prepared to administer a strong dose of reassurance, combined with facts. And in every case, keep in touch in the days following the close to make sure everything is on track and they are still comfortable with their decision.
On an emotional level, buyer’s remorse makes perfect sense. During the buying process, the clients are having fun, enjoying the process, feeling in charge. Once the “Sold” sign goes up, they’ve lost the illusion of control. You can minimize all that by maintaining open communication from start to finish, being their partner in the process, and providing plenty of TLC as needed.
Bottom line? It’s something we talk a lot about on Winning Agent – It’s about communication. You have to communicate with your client. If you do this one thing right, you will always be busy with solid referrals.