When she was looking for a home this summer, her first-time buyer, Xinyu Li, found her emotionally overwhelmed. She and her boyfriend were denied some offers and Xinyu forced her to check the online list.
“It was a lot of stress and anxiety,” she says. “I had to go for treatment.”
Xinyu’s psychotherapist advised her on a mindfulness strategy and suggested that she see the online list only once a day. After Xinyu closed a condo in New York City and stopped spending hours searching for a house, she felt better and stopped meeting the therapist.
Shopping at home is a stressful experience even in peacetime. Partly the size of the transaction. Homes are the largest single purchases most people make. Second, there are emotional considerations about lifestyle issues such as commuting time, school quality, and neighborhood crime rates.
The 2021 home market, which is increasing the interest of homebuyers in mental health, is unusual. Prices soar to record highs, inventories are very tight, and bidding wars are common.
These market conditions are strengthening the process of constantly challenging the process by which even the most experienced homebuyers can test their mental health.
Ryan Gorman, President and Chief Executive Officer of Coldwell Banker Real Estate, said: “In tight markets and inventory-constrained markets, there are more buyers than homes to buy. When something is emotionally important to you, financially important to you, and challenging. , It can be very stressful. ”
Tears house price
During the coronavirus pandemic, home prices rose with a double-digit clip. According to the National Association of Real Estate Agents, a typical American home sold for $ 352,800 in September, up from $ 311,500 the previous year.
In the case of Xinyu, the stakes were even higher. She and her boyfriend paid $ 882,000 for a condo in Brooklyn.
Dan Ariely, a behavioral economist at Duke University and author of predictably irrational books and other books, says these are the sort of numbers that create high-pressure situations.
“Every large purchase can create a lot of stress,” says Ariely. “By definition, bulk purchases mean that mistakes can be big. It’s unique.”
Bidding war creates many losers
If buying a home is always stressful, today’s out-of-stock adds new wrinkles: buyers with sharp elbows are fighting each other for the home.
Only one person can win the bidding war. If there are 12 buyers competing for one house, 11 will leave the loser.
“The biggest cause of buyer disappointment is losing real estate,” says James McGrath of real estate broker Yoreevo, Xinyu’s broker. “It’s important to have the right expectations to avoid disappointment as much as possible. Losing always stings, but it’s so disappointing if buyers know their odds are 25 percent instead of 95 percent. It won’t happen. ”
Of course, the level of competition adds a new layer of stress. Buyers know that they need to bid aggressively to win the bidding war, but the reality adds the risk of large payments.
First-time buyer John Dempsey moved to a new location in early November. He paid $ 255,000 to a townhouse in Wilton Manors, Florida.
The victory only happened after a month of searching for a house, which he describes as a “hellish experience.” Dempsey lost a bid war on six properties — he didn’t get it after every time he imagined he would move home.
“You put a small piece of your heart at home, and suddenly the carpet is pulled out from under you,” says Dempsey. “You start to be discouraged.”
Dempsey wrestled with an agent who often took hours to answer his inquiries. He finally switched to a buyer’s agent at Better.com, a mortgage and real estate company where Dempsey works as an executive assistant.
“She was very communicative,” says Dempsey. “She was like,’Don’t worry, you’re gonna get it.'”
Dempsey is happily at home in a new location, and he says the experience emphasized the importance of emotions in the home-buying process.
“I think people forget the emotional connections they have at home,” says Dempsey. “For me, the house is your comfort. It’s your peace.”
How to deal with the challenges of the home sales market
Home buyers often focus on numbers. What is my credit score? Where are the mortgage rates? How much house can you afford? How much is the down payment ?
But emotions can be just as important, especially in unbalanced markets. Here are some tactics and tricks to calm your mind and maintain your mental health:
• Understand how crazy this market is. Coldwell Banker’s Gorman proposes a “leveling conversation” with realtors to establish expectations about pricing, pace, and levels of competition. “Even if you’ve bought a home before, this market is different,” says Gorman.
• Get ready to lose. “Whether it’s a checkered game or a home bid, losing isn’t fun at all,” says Gorman. The deep emotional bets that accompany home purchases make it especially difficult to lose.
• At your own pace. A desperate search of Xinyu’s list didn’t get close to her landing the property. “There is a kind of paradox there,” says Gorman. “I don’t know if infinite Google will give you any more information. Pressing update every 5 seconds is probably stressful and actually useless.”
• Find an agent to guide the process. Dempsey says his first agent’s uneven communication exacerbated his process. Gorman is not surprised. “The lack of information often creates a horrifying void,” he says. Gorman says “quiet conversations with skilled agents” are important.
• Adopt the idea of necessity. Ariely says the “yes” or “no” part of the decision needs to be removed. “People need a new home, and there is no option not to get it,” he says. By omitting that little uncertainty, you can narrow your focus on choosing the right home.
• Give yourself a time limit. For example, Ariely proposes to set a three-month deadline. Accept the best properties you can find within that time frame.
A potential buyer with her real estate agent sees a home for sale during an open house in Parkland.
Finding a home can endanger the mental health of the buyer
How to deal with the stressful housing market
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