HERD MENTALITY AND REAL ESTATE
In my previous career as a grocer I noticed an odd
phenomenon that was interesting to me. Whenever shoppers
head for the checkout stand it always seems to attract
a crowd. I watched and studied this scene for many years
and the only explanation that I could come up with is that
it is somehow rooted in the herd mentality. Like a herd of
sheep or cattle, when one person starts through the checkout
line for some reason the lines quickly fill up and cause
a log jam. It’s like a race to beat the other shoppers out
the door! The crowd thins out and it gets quiet until the
next herd surges for the gate. If you don’t believe me, go
watch for a few hours at any grocery store!
So what does that have to do with real estate? The same
phenomenon happens in the real estate market in a couple
of different ways. A property can be listed for many
months with little or no action, but when an offer comes
in, it seems as if suddenly the buyers come out of the
woodwork to make competing offers. I’ve seen the same
thing happen with fish while fly fishing in high clear lakes.
Your tasty looking offering can go unnoticed for quite
awhile, but when a fish sees another heading for the bait,
the race is on to see which can get there first!
For a few years now we have been deeply embedded in
a buyer’s market. Many listings languished on the market
until this last winter began and road weary sellers pulled
their tired listings off the market to rest for the season. Guess
what happened? The buyers who had been actively watching,
but without making that fact known, now came out of
the woodwork, worried because targeted properties had disappeared
from the internet and other advertising venues.
Several of these off-the-market listings have sold recently.
The list agents received more calls from buyers and more
legitimate showings after the listing had been removed from
the market than they did during the entire listing period. I
share this observation merely to point out that the shift to a
seller’s market seems eminent.