The two  most important traits  separating  the savvy real estate investor from the average non-professional  homeowner are not getting emotional and  good market timing.

 

Here are 5 major tips for surviving today's difficult market conditions if you are a seller or a buyer.

1. Don’t get emotional

 

The typical homeowner buys a house because it appeals to his or her emotions.  It’s how that house makes them feel. 

 

Notice the stupidity of some of the realty commercials on T.V.

 

“Look, Merle, there’s a swing for little Susie.  I love this place. We can build a lot of memories here.” 

 

Folks, this is dangerous. 

 

I’m observing people buying  and selling properties for all the wrong logical reasons.

 

That house has a great yard, or no yard, or the person grew up on that street, or it has beautiful bay windows, or it backs up to the seventeenth hole, etc.

 

Unless, you’re getting  a great deal you’re spending way too much money.  The emotional buying  of housing can get very expensive. 

 

 

2.  Tailor your buying and selling to market conditions

 

Sit out the buyers’ market if you’re a seller.  Wait an extra year or two until things calm down.  Then sell.  You have to think and move in the opposite direction from everyone else.  Don’t follow the lemmings.

 

 

Markets are slow for sellers right now in many areas.  You’ve got a house to sell.  You aren’t being transferred out of town and you can wait the market out if you have to.   Do it.

 

If you don’t, here’s an example of what can happen.  

 

You spot your ideal dream home for sale and you absolutely have to have it.    You negotiate, or try to negotiate with the seller, who quickly figures out you want it badly.  He plays you like a tune fork.

 

You buy.  Now you’ve got two mortgages to pay and the clock is ticking.

 

It takes six months to sell your house.  Finally you get  a bite. 

 

That’s how not to do it.

 

3. Do not buy a second property until you’ve sold the first one.

 

This is so basic, we won’t spend a lot of time here.

 

If you have to take the money out of the first property to help finance the second one, sell first and then buy.  If not, the extra money will have to come out of your pocket or you’ll have to rent one of the properties out.  That’s a high price to pay for emotional satisfaction because you may not be too happy after all the smoke clears. 

 

However, if you must rent it out, it’s not the end of the world.  Just do it.  Try for shorter leases such as six months so you won’t be tied down when the market does change. 

 

If you  don’t want to handle the tenants yourself,  get a property management company to handle the details for you.

 

But get some sort of income flowing from that property.  That will buy you time and time is what you really need the most right now. 

 

4. Don’t allow buyers to hold you hostage

 

Avoid fussy fights with buyers who want to squeeze you  dry.

 

Never allow anyone to get the upper hand during negotiations.

 

If your house or rental has been on the market too long, take it off the market for a while until a new group of buyers or tenants comes along.  A stale property is ripe for discount and most buyers certainly know that. 

 

Let's say your buyers are a demanding  little couple who insist  you do major changes to the house before they will sign.  They give you their  fantasy wish list which includes such things as replacing all the  windows.  The problem here is you think you have to take it all seriously.

 

If you don’t give them what they want, they’ll bolt.

 

A real estate investor would have done the whole deal totally differently because he wouldn’t have gotten himself into such a box in the first place.  He knows how important timing is.

 

5. Get the correct information about your current market and then act accordingly

 

This is something I am  noticing about young people.  They are doing their own research.  They’re not sitting back while realtors spoon feed vital information to them as if they’re having sparse meals of pabulum.

 

Don’t let a realtor talk you into massive discounts if you can take the house or property off the market and sit it out.    I’m seeing houses being discounted $30,000 or more in Nashville’s market.  And we’re considered a decent market, in spite of all the problems in other parts of the country.  

 

You must relate to the timing of the current market.  Most people never learn that.  

 

 

So what does it all  boil down to?

 

Timing and emotions.

 

Keep your head and emotions in check.

 

Yes, you wish it was like Pollyanna’s Glad Town where everything is perfect and you could get your ideal price.  But if it isn’t, accept the reality and change your maneuvers.   In the end, you’ll be very glad you  did.  

 

  

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