The Psychology of Buying a Home
on Jun 9, 2014
Listed in Strategy

We make purchasing decisions every day. From where you get your morning coffee to what you select from the dinner menu and everything in between. Do you remember the last time you were ‘just looking’ as you passed through a store and you ended up at the cash register without even planning on it?

Let’s take a minute to simplify the entire sales experience so that we can identify what it takes to make us buy and how that relates to your real estate business. This could be a game changer in thinking on step ahead of your client. There’s a strategy in selecting which properties you show to your clients, and it goes far beyond the amount of home they can afford and the school districts they like. This could even offer insight into how you choose to present your listings to new potential buyers.

Why do we make purchasing decisions?

Beyond the realm of real estate, this is a topic that’s been examined for years. There’s an entire ongoing study referred to as Consumer Behavior, which Psychology Today explains as a way for large corporations to understand your purchasing decisions. Why not take the concept a step further to better understand your real estate clients?

We need to begin by identifying the flow of what it takes for a person to reach the point of making a purchase. In most cases, all of the following steps must be met before someone will be ready (and willing) to buy.

Recognize there is a need to buy.

Buying a home is a big decision, so it’s extremely important that you understand what made your client reach this point. This will be unique to each person/family and is the driving force motivating their purchasing decisions. It’s also generally the piece of the puzzle that sets apart the ‘can’t live without it’ from the ‘it would be nice if’ thought process.

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Did they decide to move closer to a family member? Is a baby on the way? Is this a work relocation? The list of possibilities is endless, so pay careful attention to your client’s answer to this question so that you don’t miss the boat.

See value in the potential choices.

Houses are costly, so it’s important that your client sees what you’re presenting to them as having immense value. If one choice has a gorgeous infinity pool but the client is completely terrified of swimming, odds are that they will view that feature (although beautiful to most) as a big negative.

It’s also common for people to attach feelings to words they use frequently in their own vocabulary. If they’ve repeatedly mentioned how important it is for them to have a ‘large family room for everyone to spend time together’, make sure you don’t point out the ‘den’ or ‘living room’ of a home; rather use similar language so it’s easy for them to visualize this becoming a space for their family.

Consider alternatives.

It is nearly impossible for you to feel like you’ve gotten a great deal if you haven’t had the opportunity to compare other less ideal options, and the same is true for your buyers. If you’re in tune with what motivates them to want a new home in the first place, then you can begin with a handful of choices. From that list, you’re probably able to identify those properties that you think will be the front runners before you even take the client to see them.

Avoid information overload at all costs. Have you watched any episode of Say Yes to The Dress when the bride says she’s tried on 100+ dresses? I can almost guarantee that no one accompanying her is enjoying themselves at that point. Avoid fatigue with your buyers by thinking a few steps ahead of them. Initially eliminate any choices that have less than 90 percent of what they’re looking for, and put those in your back pocket for later if needed. Now you have a backup plan in case they change their mind mid-stream, or if you strike out with your first picks.

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Weigh the available options.

The time has come for the client to make a decision! Help them out and organize all options and information together to allow them to easily draw their conclusions. Develop a clear and concise way to recap each choice and pinpoint what makes it a great option as well as what it might be lacking.

Have a plan in place leading into this recap and ask direct questions to make them consider things not only at present, but to get them thinking of living in this home for years to come. Remember, that they chose to work with you because you are an expert, so take charge and lead the conversation to get them thinking.

  • Carefully select the right words: It’s a ‘home’, not just a ‘house’. It’s a ‘less expensive option’ and not ‘the cheaper one.’ Incorporate terms the client would use as much as possible.
  • Develop a strategy to separate need from want: It can be a list, a chart or even a questionnaire. Find out what works best for you to keep this information top of mind whenever you think of this client.
  • Pay attention to the presentation: When you previewed the home, did you notice that the seller had a flag on the front porch of a rival football team of your client’s? Subtle things like this could cause your client’s mind to immediately view this situation as negative, even if they’re not totally sure why. Pay close attention to detail, and if needed coordinate with the other agent to make any special requests.
  • Order is important: It’s very common that the last home visited will be the most vivid in your client’s memory. Be selective in your showing order and save the best choices for the end.

You’ve got the tools to get the deal, and now the next step is to make this person become a lifelong customer!  Have you personally had the opportunity to make past clients come back to work with you again on future deals?

We’d love to hear you weigh in! Just use the comment section below to tell us about it.

VP Product

Real estate is in Katie’s blood. She's a second generation REALTOR and comes to TRIBUS after working for a prominent custom home builder in metro Atlanta, GA. While selling homes she realized she had a passion for helping agents establish a meaningful web presence and a build CRM that worked. Since then she's become a Certified Scrum Master (CSM) and graduated from a UX program, all while staying grounded in real estate technology.
Her background in the industry and her training in psychology have paved the way for her current user experience focused role, where she leads the product team at TRIBUS.
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