Buying a piece of real estate is an irrational act more akin to the emotional experience of falling in love. Most people know the feeling; that visceral reaction when you walk into a home and it “feels right”. The endorphins in your brain release and you start to immediately picture yourself in your dream home. How else can you explain someone paying $ 238 million – the highest price ever paid for a home in the US, or $1M for a studio apartment? It happened to me when I bought my first home. I submitted an offer before I walked upstairs to the second floor of the house. I looked outside from the living room to the backyard, and saw the garden and swimming pool, my heart rate went up and the rest was history. I probably overpaid, but I never regretted it.
Our job as real estate agents is to rationalize this irrational act with data that makes the purchaser feel good about their purchase. We are tasked with showing a comparable sale to prove the relative value, so the buyer doesn’t feel like an idiot for overpaying. If you love it, can afford it, and can rationalize the price – you should buy it.
The art of a really good agent is their ability to know how to read their clients' reactions and emotions in the flesh. The same is true if it’s in the living room of a penthouse or a sales center for a new development. In 2003, I headed up a project at 260 Park Avenue South. We created 109 loft apartments in a converted 1913 office building. It was pioneering on a number of fronts. The amenities, the neighborhood, the level of interior finishes, and the prices. The developer tasked me with being the face of the project and most importantly, being the communicator. I was the main artery that informed the market in both directions. I presented the project to potential buyers, and most importantly, I had to read the reactions and responses of the buyers and inform and advise the developer. My in-person interactions with the buyers and brokers were critical to our success. We raised prices more than 20 times on the project and by the time we were sold out, we shattered every record downtown.
As we all know, when disruption first came for the real estate industry, it was aimed directly at eliminating the agent. This concept failed miserably after realizing it’s the agent who is the key to success, and very quickly the focus turned to creating tech to support traditional brokerage. We continue to innovate tools for the agent, but nothing has yet to replace the value to a seller of the in-person agent/buyer experience.
When Covid-19 hit and our business was shut down, there were homeowners who still had to sell their homes. Agents were in lock down but still had to accommodate our clients. We had to come up with a solution that replaced the in-person showing experience. We created live online presentations where our agents “walked” a buyer through a property by showing a floorplan, photos, a virtual tour, view shots and describing the finishes of the property. All this over a screen. I toured hundreds of properties online with live agents to see what people were doing and it was clunky at best. Yes, we sold homes, but these were generally dire situations or in projects where the product was exemplary. This pandemic has proven once again that you can’t sell a property for the highest price if the buyer doesn’t get to step inside a sales center or look out from the living room to the view outside and experience the “feeling” of the home. This is how we fall in love and this in-person interaction is how the artful real estate agent can do their best work.