You would think that for one to write on a particular subject, that one should be an expert. In this case, that’s not so. Well not entirely. I actually have a great deal of patience, but boy does it get tested! And that is why, in fact, this becomes a very good subject for the Inside Real Estate column.
Anyone who’s been doing any one thing for as long as I’ve been brokering homes would like to think they’ve seen it all. Of course, that’s never the case. And while I’ve been through several up/down cycles in the housing market here, I have to say this one is unique to the degree of almost bizarre.
It started out a big “Hallelujah” like every recovery. And it even had a healthy little hesitation about a year-and-a-half in. And then it got crazy. With the economy booming, and interest rates amazingly low, a bidding frenzy ensued between first time homebuyers, new-comers to the state, and investors. Initially, only the entrylevel priced homes were involved in this, but soon, all those who now felt job security again, and wanted to move up in home size and quality, entered the fray. By early 2015, with the overall inventory of available homes at a record low, homes even double the market average price were experiencing multiple offers, especially if they were in premium locations and condition. The luxury market really only normalized, even though the number of luxury sales went up, because inventory remained healthy. Remember that was the market hardest hit in the housing crisis and many of those who simply withdrew from that market are now back, trying to make their move in this ‘recovered’ market.
So what does all this have to do with patience? Well, buying a home in a market like this truly requires just the right kind of patience. Not “I’ll just wait until the right house comes along” patience, but “I will keep looking and keep putting forth offers until I get one” kind of patience. Noting that all of those unfortunate enough to not have already been a homeowner by early 2014, yet fortunate enough to actually be qualified to buy a home, have been sorely tested in their pursuit of the American dream. And I don’t want to fault the big, bad investors, by the way, for they, too, are entitled to the American dream of owning real estate as a more solid investment than gambling in the stock market for reasonable returns on their cash. The real culprit here is, in my opinion, the bureaucracies and selfserving lawsuits that have created huge barriers to those who would build entry-level homes, enough for the aspiring homeowners, as well as the investors who fill the need for rental housing in the same price range. The Denver metro is literally starved for homes under $300,000, and truly that number is now approaching $400,000. So perhaps the kind of patience to recommend to buyers I would call persistent patience.
The next thing that occurs in such a frenzied market is a testing of professionalism amongst those who serve the home selling and home buying industry. Yes, I’m talking about the Realtors®, myself included, who are only rewarded upon the successful sale of the home. Even as I mentioned buyers being willing to put forth multiple offers until they finally get a home, I could feel a little shudder in my own bones knowing that I must, to best serve my client, be willing to show many homes, and write many offers, before I see my own payday with that client. I remember the first time I experienced a home seller via their agent ‘collecting’ offers for a few days before reviewing them, encouraging a bidding war. My team Buyer Specialist, who was working with that client, was livid. I was not thrilled, but truly more intrigued than upset. A new dynamic had entered the real estate marketplace. For home sellers, of which I represent many, this truly is a very smart way to sell when the market conditions support it. I now utilize that technique in service of my home sellers when indicated, and have great success with it. But if four offers show up on one property, there will be three unhappy parties when the dust settles. And those three parties are represented by agents who are equally unhappy, and sometimes quite ungracious losers. Ironically, sometimes even the winning party becomes resentful that they had to pay a premium to win the bid. And they’ve been known to try to take it out on the home seller by way of excessive demands on inspection, and even backing out of the deal a week or two later. Statistically 1-in-5 contracts will crash. Back to start. Do not collect $200.
This brings me to the subject of patience that home sellers might consider employing for their own part. There is a longtime dynamic between homebuyers and home sellers that becomes exacerbated in a fast-moving market. And that is that homebuyers are almost always concerned that they might be paying too much, while at the very same time the home seller is concerned that they might have sold too cheap. Greed, on either side of the equation, is guaranteed to stress a transaction, and increase the odds that it might fail. And a failed transaction is simply a lose-lose proposition, wasting much time, energy, and money. I have to say I’ve been graced with a preponderance of clients who really just want what’s fair, with their initial and actual objective kept in focus, which is to purchase a good home for their needs, or sell their current home at a decent price so they may go on to what’s next for them. I’d like to think my counseling plays a constructive part in that attitude. But I’m also willing to accept that I may just be that blessed.
As in all of life, there are things that we can control and things we cannot. Control itself is a deceptive concept, and perhaps we’d be wise to strive for good management rather than the illusion of control. After all, much of the frustration that people experience has more to do with unreasonable expectations than actual calamity. A friend of mine has reminded me that “expectations are but premeditated resentments.” Think about that. Another friend, and mentor, when asked why people do the things they do, replied, “for their reasons.” Patience, I’ve learned, comes with wisdom, and so, while knowledge and expertise are extremely beneficial in my business, as in any, I will defer to wisdom every chance I get. Here’s to Happy Homes!