There is a cost associated with not taking action, for waiting. It is the weight of waiting. In business it is also known as the opportunity cost; that is, the loss of potential gain from other alternatives when one alternative is chosen. In this case, the party chooses to do nothing. There are both buyer and seller “waiting” stories.
Some buyers choose to wait think that the market is going to go down. Or sometimes they are waiting to save more money for a down payment or for an increase in salary so that they can afford a larger home. Another scenario is waiting for their current home to go up in value.
Markets also appreciate and there are opportunity costs that correspond to this approach, the lost potential increase in value by waiting. Or if interest rates rise the purchasing power actually may decrease even if the borrower has more income. And while the buyer waits for the market to go up to sell their home for a higher amount, it is usually going up where they want to purchase as well which may nullify the increase. Buyers can actually be priced out of a market because they waited too long.
The seller who decides to delay doing anything is almost always waiting for the market to improve. There are sunk costs that the seller is trying to re-coop. It may take years for the market to improve and when it does then other sellers may too decide to enter the market at the same time. This floods inventory which can put downward pressure on prices. Also interest rates could increase which decreases purchaser’s buying power, thus causing them to not be able to pay as much as before. Some sellers wait for the market to improve for years, all the while not being able to move on with their lives. There are life events as well that sellers wait for, such as for the children to move out or retirement.
In the Dr. Seuss book “Oh, the Places You’ll Go,” there is a section on the “waiting place.” The people are “just waiting” for something to happen. Seuss proclaims on the next page that “No! That’s not for you! Somehow you’ll escape all that waiting and staying.” The secret I have found is to help people understand the true weight of waiting. That is, what are they losing out on by not acting. This paradigm shift often helps them move on. The best course of action is to follow Seuss and act to make something happen.
Karen Briscoe and Lizzy Conroy and their team are active and experienced Realtors® in the Northern Virginia, Washington DC and Maryland market place. Should you or someone you know be tired of “waiting” and desire guidance from a professional Realtor®, please visit our website for more information at: www.HBCGroupKW.com or contact via the means most convenient for you: 703-734-0192, Homes@HBCGroupKW.com