The Heartbroken Buyer Syndrome

• August 13, 2010
• 4 Comments

by Ryan Holeywell

Earlier this year, graduate student Kris White fell in love with the house of his dreams: it had a newly renovated interior, a convenient location near Columbia Heights, and of particular importance to White, a large backyard.

White offered slightly more than the asking price of $439,500, but his offer wasn’t aggressive enough. There were eight other bids on the home, which eventually sold for $475,000.

“Not only did we lose,” White said. “We lost big.”

White recently closed on a house just a few blocks away for $455,000. But, when asked if he’s just as happy with that property, he hesitates. “I’m still trying to answer that question.”

White, who admits that in retrospect he would have paid $475,000 for his dream home, is part of a growing number of home buyers who are finding that they have to get their heart broken by losing out on a property before they get serious about buying.

Kevin Wood, an agent with William Sawyer & Co., said many first-time buyers think the market is worse than it actually is, and therefore make offers that are too low or wait too long to actually make an offer at all.

“Many buyers think that DC is in the same boat as the rest of the country, so they’re not realistic about how quickly things move,” Wood said. “They think they’re going to get a better deal than they can get.”

Indeed, data from Metropolitan Regional Information Systems indicates that residential properties in DC proper spend an average of 62 days on the market and are selling nearly 30 percent quicker than they were a year ago. Half of listed homes spent a month or less on the market.

And the Greater Capital Area Association of Realtors reported in June that the city has 3.9 months of residential inventory, compared to a national rate of 8.3 months.

Still, agents say that, despite all the statistics, it isn’t until that first property slips away that the home shopping process becomes easier.

“I will sit with clients at the beginning and let them know what the market is doing,” Fernando Garcia, an agent with Continental Properties, told UrbanTurf. “They never listen to us until they have their heart broken one, two or even three times.”

And once a buyer misses out on the dream home, Garcia said, it can be difficult to help them forget about it, since they often compare subsequent homes to the one that got away.

“When we lose out on the first property, I can tell them until I’m blue in the face that they need to forget about it,” Garcia said. “Once they actually get that out of their head, they can look at properties without bias.”

Pamela Wye, an agent with W.C. & A.N. Miller, said she has a number of stories of clients who hesitated on the first home they were really interested in, only to lose out on it and regret it later.

The Adams Morgan condo that got away.

About six months ago, one of Wye’s clients fell in love with a two-bedroom condo in Adams Morgan, but wanted to take a few days to think about it – even though Wye believed the unit was underpriced.

“When he found out it went under contract, he was devastated,” Wye said. “He talked about the unit for weeks.”

Another buyer lost his dream condo in Logan Circle because he wasn’t willing to increase his offer by $3,000. Now, Wye said, he can’t stop talking about what a mistake it was.

“Sometimes, buyers just want to try to go with a low ball offer,” Wye said. “If you really like something and the comps show it’s priced right, you should move quickly. Quality properties do not stay on the market long in DC these days.”

Buyers can avoid the trap of first-time heartbreak by knowing exactly what they want in terms of property type, location and budget, said agent Jennifer Myers. “I have found that if people don’t really know what they’re looking for, they have to go through the heartbreak in order to know, ‘I messed up on that one,’” she said. “I always tell buyers ‘If this is the one you want, be prepared to claim it.’”

But, she notes, it’s not the end of the world if someone misses out on a property. Often, buyers are happier with the property they ultimately end up with and forget about those that slipped away.

Wye added similar words of consolation when a client loses out on a home. “New inventory comes in every day,”

Ryan Holeywell is a Washington, DC-based journalist whose work has appeared in USA Today, The Detroit Free Press and washingtonpost.com. He can be reached at .(JavaScript must be enabled to view this email address).

This article originally published at http://dc.urbanturf.com/articles/blog/the_heartbroken_buyer_syndrome/2371

4 Comments

1. Missed Out said at 11:10 am on Friday August 13, 2010:

   I agree. Twice now I have regretted not making offers on condos that I loved, one in U Street and the other in Kalorama, that were under contract just days after I went to look at them.

1. tom said at 12:49 pm on Friday August 13, 2010:

   The bottom line is that things dont stay on the market long at all if they are quality. I looked at a place in dupont two weeks ago that was under contract a day later.

1. The One That Got Away said at 7:20 pm on Friday August 13, 2010:

   We’d started looking for our first place—but not too seriously, mainly online—when we decided on a whim to visit “the One That Got Away.” The price seemed impossibly high, but we ended up putting in a lower offer.  The seller came down some, but we ended up backing away over $10,000.  The house went under contract the next week at the price we could have had. We were crushed because by that time we’d come to realize that we could have easily afforded the house, despite our sticker shock. 

   It took us five months (and lots of tears, I’m somewhat ashamed to admit - thus the anonymous posting) to find another place, and we probably paid more than we had to because we were afraid of losing it.  We really like our place, and it has some advantages over The One That Got Away… but, like a first love, the first house’s pull will never fully go away.

1. Regrets said at 10:37 am on Monday August 16, 2010:

   Our first serious day of looking last summer, we saw a co-op that had just gone on the market. It was perfect right down to the paint colors. We revisited the next day and made an offer that night. There was another full price offer, so we matched that, but the other party waived the inspection and the sellers went with their offer. Heartbreak. We ended up finding the same floor plan on a similar floor in a building next door a few months later and made a full price offer. It was $20K cheaper than the first but not in as great shape and minus a half bath, and we’ve put $40K into it (so now we’ve spent 20K over what the first perfect co-op cost, which we wouldn’t have changed at all, and we would’ve had an extra half bath).

   We could’ve avoided paying full price on the one we did buy had we not been so scared of losing this size co-op in the area we wanted a second time. I used photos of the original to help choose paint, redo our kitchen, and buy furniture.

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