When Emotional Value Impacts A Sale
What am I talking about when I say ‘emotional value’? I’m referring to the value people ascribe to an object based on the way it makes them feel. In real estate, we see this happen sometimes when people put their homes for sale.
We all have feelings, positive and negative, about the places we’ve lived in. I remember the first house my husband I owned, on Wiggins Ave. It felt incredible. It had wooden floors we found under the carpet, and we spent weeks sanding the stairs to bring that old wood back to life. We painted every inch, updated windows, styled it beautifully with intention and thought. We created the backyard of our dreams, and I would sit under the big trees there and listen to the city around me, content and safe.
It was the house we were married in, the house I began and finished my Master’s degree and entered my career from, and the house we brought our first baby home to. I knew every creak in the floors; every dent in the wall.
I also lost a pregnancy in that house. And I remember exactly where I was standing in the kitchen and sunk to the floor when my dad called to tell me he had been diagnosed with cancer, and it was terminal.
Our stories are written all over the walls of our homes, and when it comes time to part with them, it is very hard to put a price tag on a place that feels immeasurable in so many ways. Neuroeconomics is a field of study that looks at how brain biology impacts decision-making, particularly when it comes to finances. The same portion at the base of the frontal lobe of the brain is involved with not just emotion, but also reward, motivation, and value. Thus, physical spaces that evoke strong memories can feel invaluable, despite a house being a physical thing with a price tag attached.
Although understandable how and why emotional value can impact a seller’s stance in pricing their home, it can indeed be detrimental to making a good sale because oftentimes one’s emotional value does not align with comparative market value sales data; or in other words, the price a buying market is likely to support.
Prospective buyers are entering your home and looking at it in terms of its location, square footage, orientation on a property, lot size, updates, mechanical status, amount of parking/garage, etc etc etc. Although buyers may feel positive emotion upon entering a property, it is unlikely the level of it will match the same depth and expanse of the memories and comfort the seller has experienced in that space. Thus, they will assess your home and the price of it based on comparable recent sales of nearby properties, and generic features that tend to appeal to many buyers.
Is it hard to get real about your sale price? Absolutely. When we finally sold our Wiggins house, we knew we would never see a return on the time and energy that we invested in it. We knew that almost all updates and upgrades see a fraction of their return on a sale price. But we also knew that the life we lived in that house was only personal to us, and that everything we did in that house was to improve our quality of life while we were there. And guess what? All those memories we made in that home didn’t stay there - they came with us in our hearts and our heads onto the next leg of our journey.
Examples of phrases or thoughts that may indicate ascribing emotional value to our homes:
I have spent hours on [this project/house/item] and there is no way I am selling it for X dollars.
I know our updates are not ‘new’ anymore, but they cost us thousands of dollars [X years ago] and we need to recuperate those costs.
I built this house with my own two hands, and now I can’t just give it away.
My spouse has passed but I cannot imagine how they would feel knowing our home is only worth [X dollars].
These types of feelings are one hundred percent valid, and incredibly powerful in impacting our decision-making. However, it can be helpful to focus on what lies ahead instead of what you’re leaving behind, and knowing that the act of parting with one abode will be what delivers the sweetness in moving into the next, whether it be in your equity, freeing up funds for other things in life, improved space or design, a new community, or anything else that makes a move enticing. Lean on your supports around you to talk about how you’re feeling and allow them to help you see your home from a more objective standpoint. Ask your realtor to show you comprehensive comparable sales data to help you understand the market you’re selling within.
The bottom line is that pricing your home in accordance with market data is the best way to reach for a strong and timely sale.
Questions? I’m always here to chat. Reach out any time, I love hearing from you!