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August 17, 2009

The Emotional Undercurrent of Buying and Selling

Inside the real estate bubble of yore, buyers could act as impulsively as they wanted, reports The New York Times: if buyers changed their mind, they could always sell at a profit. But in today's market, "buying a home is more psychologically demanding, fraught with conflict and confusion." For buyers, especially those without much capital to burn, deciding on a home can be extremely stressful, since it involves a long-term commitment. And for sellers, some of them refuse to sell now, even if it's a good idea for them, because they don't want to feel regret or shame at having bought at the height of the bubble. Kathleen Gurney, the chief executive of the Financial Psychology Corporation in Miami, told the Times, “People will do anything to not regret how they feel," including extending their losses so as not to feel stupid. The article also explores the differences in the market and people's perception of the market. Even if this is a good time for some to buy or some to sell, we are pack animals, and when the pack is afraid of dealing in real estate, so is the individual. As Dr. Gurney said, potential buyers and sellers would rather "be a part of a crowd, even a crowd of losers, than stand out.”
In the Grip of Indecision [NY Times]
Photo by LunaDiRimmel

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Comments

sounds good. Buy something because you want to live in it for long time. A home is not an investment vehicle.
Our neighborhoods dont need speculators, flippers. They need people to live and participate, be a part of the community.

Posted by: Petebklyn at August 17, 2009 9:22 AM

Someday this war's gonna end. That'd be just fine with the boys on the boat. They weren't looking for anything more than a way home. Trouble is, I'd been back there, and I knew that it just didn't exist anymore.

Captain Benjamin L. Willard - Apocalypse Now

The What

Someday this war is gonna end...

Posted by: Return of The What at August 17, 2009 9:30 AM

Someday you'll stop behaving like "the crowd of losers."

Posted by: daveinbedstuy at August 17, 2009 9:38 AM

"For many homeowners who bought at the top of the market, admitting what now seems to have been a mistake is painful, and could keep them from selling, even though the decision may be a smart one."

Powerful.

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 10:13 AM

Booyakah booyakah! A throwback What post! You know shit's hitting the fan when you get those.

When the Times starts writing stories like these (you gotta love that photo - take another look...ROTFLMMFAO!)...

I'm convinced that DIBS is a REBNY mole (brilliant operation).

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 10:20 AM

Noticed everyone is ignoring Team Bear, ROTFLMMFAO!

BHO The Forte Condo Melt Down ignited the Thermonuclear Bombs.

Right now I'm making this call-- IT'S F************ OVER!!!!!! Done Finished and Kaput!

The What (Thanks for the memories)

Someday this war is gonna end...

Posted by: Return of The What at August 17, 2009 10:24 AM

Am I missing something, because I don't understand Ms. Gorman's position in this article. She says she can either keep the apt or use the money from a sale towards a new place for her fiance. Um, if she sells this place at a huge loss (on the market for $559, bought for $615, loss of $56K so far) assuming she even gets what's she's currently asking, which doesn't seem likely since the article also says similar apts in her building were going for $400K. how would she be able to pull equity to buy something else unless she put something like 50% down??

Posted by: Tdeezy at August 17, 2009 10:35 AM

She could simply be walking away with less cash (say 100 grand down, 44K gross leftover), Tdeezy. Still a loss but yet a position to start over with (money to use). As implied by the quote in my first post, she'd be stupid to keep the apartment.

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 10:48 AM

I don't understand why an article about buyers who can't make up their minds dwells on a seller. Anyway, too bad they didn't interview us.

Posted by: mopar at August 17, 2009 10:54 AM

"I don't understand why an article about buyers who can't make up their minds dwells on a seller. Anyway, too bad they didn't interview us."

Because you're retarded Mopar...

"She could simply be walking away with less cash (say 100 grand down, 44K gross leftover), Tdeezy. Still a loss but yet a position to start over with (money to use). As implied by the quote in my first post, she'd be stupid to keep the apartment."

It's the psychology BHO! The Retards beLIEve gravity doesn't exist.. The "Hold On" part is going to be the saddest this about the Mutant Asset Bubble...

The What

Someday this war is gonna end..

Posted by: Return of The What at August 17, 2009 10:58 AM

Yeah, it doesn't mention how much she put down to buy the place for 615.

They could have interviewed me for this article if they had written last summer. I certainly can relate to the agonizing and soul searching that goes into such a decision these days. Tough to pull the trigger either way right now I would guess. That being said, I do have friends who just bought a house here in Clinton Hill so somebody is still buying.

Posted by: wasder at August 17, 2009 11:00 AM

I see what you mean BHO, except that what's she's putting her house on the market for isn't a cut and run price. She says similar apts are going for for $400K and still she's trying to get $559K. So she's not even following the advice your giving. Sounds like you would say sell it before it drops even lower. Instead she is floating her asking price way above what the market is now, doing this she'll always be chasing a downward price making her situation even worse. If she does this she'll never get money out, actually she might end up in a short sale situation even if she did put down $100K.
Really what I'm saying is I think the Times might want to get a better example other then these people and their poor me stories that always seem so shallow. Would it be impossible for her and her fiance to *gasp* share a one bedroom if she can't sell at the price she wants? Future losses notwithstanding.
Also, her fiance is an ass. "No honey you decide if you should sell or not that way if you make the wrong decision in hindsight it will be all your fault and nothing to do with me." He doesn't scream Life Partner to me. More like Throw You Under the Bus partner.

Posted by: Tdeezy at August 17, 2009 11:01 AM

I figured the "crowd of losers" part would be too much for The What to resist.

Posted by: East New York at August 17, 2009 11:16 AM

Yes yes, Tdeezy. Chasing the bottom down.

LOL about hubby. I was thinking the same thing. He's dead weight.

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 11:17 AM

"Tough to pull the trigger either way right now I would guess. That being said, I do have friends who just bought a house here in Clinton Hill so somebody is still buying".

Wasder as you know people buy for completely different reasons even though the economics is the prevailing concept. Could be that your friends are starting a family or need a tax shelter. We know someone who had to buy because he got tired of paying 50% of his income in taxes living in NYC....even with a depreciating asset the #s work in his favor...single guy making $350K per year.

Posted by: pierre de taille at August 17, 2009 11:17 AM

The fiance is definitely an ass. She's going to sell her place at a loss, move into his rental, then get dumped and thrown out on the street.

The Times seems to be saying "This is what happens when you buy NYC real estate... you lose money and get a crappy boyfriend".

BTW, looking for a rental apartment right now is depressing as hell too.

Prices are down, but landlords are saving money by not renovating anything between tenants. I can afford more places than I could two years ago, but I just don't want them. I'm seeing a lot of awful kitchens and bathrooms.

Posted by: northsloperenter at August 17, 2009 11:19 AM

"The 'Hold On' part is going to be the saddest this about the Mutant Asset Bubble..."

Hold on...to your baaaaaaaaaaag [Remember Envogue?]

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 11:20 AM

"even with a depreciating asset the #s work in his favor...single guy making $350K per year."

How? Can you please show me the math? Please include ALL costs (every single one of them).

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 11:24 AM

" NYC....even with a depreciating asset the #s work in his favor...single guy making $350K per year."

ROTFLMMFAO!!!

How many people on Brownstoner or want to live in Brooklyn (LMMFAO) makes 350k a year?

The What

Someday this war is gonna end..

Posted by: Return of The What at August 17, 2009 11:30 AM

"The fiance is definitely an ass. She's going to sell her place at a loss..."

But telling her to sell sell sell would somewhat vindicate him. Minimize an inevitable loss.

"landlords are saving money by not renovating"

Red flag. Some don't have money. You MUST Pshark before you sign the lease! There will be a lot of deals in nondos though. Definitely decent finishes but still questionable operations going forward. Many complaints at the Clermont (or whatever they call it) nondo on Myrtle. I would look for a nondo took over at firesale. Cashflow left over for a profitable, therefore decent, operation.

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 11:32 AM

...foreclosure will evict a tenant just as fast as non-payment.

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 11:35 AM

BHO you forgot The Forte, LMMFAO! Right down the street for Mc Donald's and shop downtown for new kicks and Gold Fronts!

The What (Sporting a Flavor Flav grill piece)

Someday this war is gonna end...

Posted by: Return of The What at August 17, 2009 11:39 AM

Hey BHO / The What, the #s are as follows:
Mortgage interest deduction on a ~$1.5 million mortgage will bring taxes down to about 39% and dude is planning to work out of his house....massive reduction in office space rental.

BTW on your other silly comment about $350K and desirability of living in Brooklyn....please see highest weekly sales every friday.

Posted by: pierre de taille at August 17, 2009 11:43 AM

'Ayo Chuck! Rock that shit homie!'

Rentals and grill pieces are now their 'forte'.

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 11:46 AM

"dude is planning to work out of his house....massive reduction in office space rental"

Steady 350K out of home? I believe you. Even if true, it's no longer a home so your argument is dead. Tell your friend to watch out for IRS/NYS. They're crackin' down!

"highest weekly sales every friday"

Where did this peak? Where are we from the peak?

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 11:56 AM

Allow me..

"Mortgage interest deduction on a ~$1.5 million mortgage will bring taxes down to about 39% and dude is planning to work out of his house....massive reduction in office space rental."

Dude doesn't understand-- We are in a DEPRESSION! The only "income' from someone masking 350 k is Drugs or Prostitution! The "Day Trader" Thang is dead!

"BTW on your other silly comment about $350K and desirability of living in Brooklyn....please see highest weekly sales every friday."

Hey Pepe you forgot about VOLUME! The biggest sales only tells us there're bigger Retards out there.

"Rentals and grill pieces are now their 'forte'."

And don't forget about "Cool Daddy Pimp' putting retards daughters on the track...

The What

Someday this war is gonna end...

Posted by: Return of The What at August 17, 2009 11:56 AM

"The only 'income' from someone masking 350 k is Drugs or Prostitution! The 'Day Trader' Thang is dead!"

LOL. 39%? That's tax free!

***Bid half off peak comps***

Posted by: Brownstones Half Off at August 17, 2009 12:04 PM

I was posting on a NY Times blog until I got kicked off. My posts were deleted since I failed to give a real e-mail address. I am as phoney.

I disappreared when the markets didn't prove my point and I take one article from the Times to reappear like I never left.

I deny that people make 350K a year since I will never make that much in my entire lifetime. I cannot even imagine that people actually got an education when they were younger instead of goofing off like I did.

Brooklyn has passed me by and I can't handle it.

I call people names since I have no comeback.

If I am unemployed, does that mean I work from home? Do you think my mama will let me take a tax deduction on her house now?

If teh economy improves, will I still be moving the goal posts?

Love me!

Posted by: ghettoazzpnkbtch at August 17, 2009 12:21 PM

Trop Drole....really funny and true as well

"I deny that people make 350K a year since I will never make that much in my entire lifetime. I cannot even imagine that people actually got an education when they were younger instead of goofing off like I did.

Brooklyn has passed me by and I can't handle it".

Posted by: pierre de taille at August 17, 2009 2:45 PM

what happened to the NY Times??

"Nearly two-thirds of New Yorkers believe that now is a good time to buy, according to a recent study of 2,000 potential buyers who responded to weekly polls conducted by the Corcoran Group on its Web site."

that's like saying "2/3 of New Yorkers think it's a great time to commit suicide, based on a survey of 2000 suicidal New Yorkers conducted by makers of anti-depressant medication". hmm, self-selecting population surveyed by financially interested market participant...

i am not a market bear by any means, but this type of nonsensical conclusion erodes the integrity the NY Times and its reportage.

Posted by: panamac at August 17, 2009 3:00 PM

"This type of nonsensical conclusion erodes the integrity the NY Times and its reportage."

The integrity of the NY Times and it reportage have been severely eroded if not completely evaporated over the past several years. That is why they are falling into bankruptcy and largely disregarded as the left wing rag paper of choice. There is very little, if any, honest reporting coming out of that paper these days.

Posted by: newsouthsloper at August 17, 2009 4:03 PM

"The fiance is definitely an ass. She's going to sell her place at a loss, move into his rental, then get dumped and thrown out on the street."

You are right. I was giving the guy the benefit of the doubt, thinking there must be some very important reason he is forced to stay in Long Island and rent, but I can't think of one.

Posted by: mopar at August 17, 2009 5:24 PM

Newsouthsloper, are you a bitter former investor in the Sun?

Posted by: mopar at August 17, 2009 7:30 PM

I hope the fiancée (Ms.)is reading Brownstoner today.

northsloperenter at 11:19 AM, has a real point -- that is echoed by mopar at 5:24 PM. I can see that she has more emotional considerations to make than just the property. Women, nevertheless, need to protect themselves. She could stand to lose much more than a few dollars (as in possibly everything).

Posted by: BklynSoFar at August 17, 2009 7:58 PM

“People will do anything to not regret how they feel," including extending their losses so as not to feel stupid.

= Dibs in a nutshell. Peak ghetto speculator. Can't be any more of a poster boy for stupidity. Then theres the handful of people on here simply being considerably "worth" less and less every day. Same 'ol s*hit with every bubble. The virtual wealth thing...

Posted by: cornerbodega at August 18, 2009 12:03 AM

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August 17, 2009

The Emotional Undercurrent of Buying and Selling

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