So last month, I put my parent’s (Mom and Stepdad) house in escrow…As I am writing this, it’s in escrow and looks like it is going to stick!
My mom and Stepdad are both Real Estate Brokers and have been in the business (until recently) over 40 years! They have more Residential Real Estate experience than almost anyone I know. What’s funny is now that they are retired, and they aren’t the agent in this transaction, they have seemed to forget everything they ever knew!!!! Haha, it’s unbelievable! They are acting like first time buyers – like they know nothing about the process and are very sensitive to everything I say even though they are old pros and know I am not trying to be rude. I am just being very direct.
The real eye opener was when my mom said that accepting this offer on their house didn’t make her happy…she texted me that. I wrote her back and said, “if it doesn’t make you happy, then don’t do it.” She thought I was being sarcastic, but I wasn’t. I was being honest and giving her my true opinion.
She bought this property 15 years ago for $850,000…she remodeled it 14 years ago. She’s about to sell it (if this deal sticks) for mid to high 3M’s. This has been a great investment for her, and the plan is to trade this property into higher producing income property via a 1031 exchange. This will allow her to avoid all those capital gains. It’s a great move for them at this time in their life and based on their other investments and income. What surprised me was how emotionally attached she was to this property. It almost made me jealous…haha! This offer was a good one and allowed her the chance to exchange. Overall, it’s a good move, yet none of that mattered. She was just having a real hard time letting go of this property. I didn’t care. I didn’t grow up in this house. I didn’t see myself living there someday. I was not attached to this “family home”.
This is a perfect example of how Residential Real Estate is so different than all other types – it’s emotional. Financial pros and cons a lot of times take a back seat to the emotional ones.
My job is to make sure that my client sees all of the pros and cons financially, personally, emotionally, and others. Ultimately, it’s up to the client. All I can do is share my professional opinion…This is literally one of the biggest values I bring to the table. My years of looking at property, doing transactions, negotiating, knowing other agents, and knowing what’s going on in the market is what makes me valuable. It makes me worth my fee. This experience and guidance is very valuable when making these large financial decisions. It’s not something you can get from an algorithm or a novice agent.
In this instance I knew my client very, very well. I knew this property did not have to sell at this moment, so if she was truly unhappy and not ready to let go of the property, I wasn’t going to push and really encourage her to do so. I also knew the harder I pushed, the more she would be turned off by doing this deal which I thought was a great opportunity for her. At her stage in life, this was a great opportunity to create more passive income, while not having to take a huge capital gains hit. I really hoped she would strongly consider this opportunity to sell the house, but knew she had to get there emotionally.
My mother told me that she wished I wasn’t so direct with her and treated her more like a client than my mom. I told her I wished I was more like this with my clients. While I am very open and honest with my clients, I am not as direct as I have been with my mom. I don’t need to be THAT direct, but sometimes you’re afraid that your client doesn’t always want to hear exactly what you’re thinking because it might not be what they want to hear.
Well, we will see what happens but whatever happens, it’s going to be a ride full of twists and turns as I guide my partners through what feels like their first transaction ever. Haha. Can’t wait till we go shopping for the replacement property!
