Selling a House - Book Report/Review Example

Selling a House Introduction Selling a house includes many processes that seem to unfold one after another as I have experienced when I had made the decision to sell my house. Putting a ‘for sale’ notice in front of my house appears to be the start to the process of selling my house. However, it only entails one of the steps on a long journey that begins many weeks before suitors (potential buyers) visit my house. In this report I will reflect on the application of different theories like Rokeach value theory, Myer Briggs Type Indicator, and the big 5 personality trait model in my house selling decision making. Application of value theory Rokeach value classification The first step towards starting the selling process will include setting up a price for my house. Since this is a crucial decision, therefore it is necessary to consider a number of factors. To set the price of my house, I need to make a value decision based on non-fixed assets also called chattels and fixtures that will along with the house. Standard items to remain in the house are dishwasher, stove, light fixtures, curtains, as well as flooring and carpets (Hayton & Marshall, 1996). Here I have applied the Rokeach value classification that comprises instrumental value which means responsible behavior so as to achieve the desired results (Vinson et al., 1977, p.248). First I have to consider the fair market value (FMV) of my house, i.e. the price at which I can sell my house in the open market (Hitchner, 2003, p.4). To ascertain the fair valuation, I must evaluate all the factors associated with my property like its depreciation value, market demand, and locality. One factor that needs to be taken into consideration is that value of property and its price are two different things. While value of property indicates its worth in the open market, the price of property is the price that is negotiated between a buyer and seller. The instrumental value that can be applied here is to reflect on the price paid for similar houses in the same locality in recent times. This is because that price indicates the amount that a buyer will be inclined to pay for my house, and therefore this price is representation of the market value of my house (Berges, 2011). This technique which is known as “sales comparison method” can be used only when there are sufficient examples of property sales in proximity to serve as value indicators (Schram, 2006, p.198). Also, there are many factors that determine the price of house which also need to be considered. First, the location of my house will certainly be a determining factor for its price. My house is located in the suburbs and therefore I cannot expect the same price as apartments sold in proper cities. Even if I value my property in the same way, it is unlikely that I will find buyers who will be willing to pay such high price. Second factor is view that can be seen from the balcony. A house which is situated in a manner so that there is unimpeded view can fetch high price. This needs to be kept in mind before I will fix selling price for my house. Accessibility to public facilities is the third factor that I can consider before selling my house. Fortunately, my house is located in close proximity to two major hospitals, shopping malls and supermarkets. This can be a great convenience to potential buyers, and as such I can command a pretty good price. Third factor is physical condition of the house that I want to sell. A house that is well maintained and is in a good physical condition will more obviously fetch better price than a house that is badly in need of repair. Fourth factor is the mode of payment. If a seller wants one time cash payment for his house then it is unlikely that he can get a high price. On the other hand, is payment terms are based on installment basis then a higher price can be asked and received. Finally, a seller’s motive is another determining factor. If the seller is in need of quick cash then he will want to dispose of his property as quickly as he can, and in such case he will be prepared to sell the house even if the price is low. However, I have no such urgent needs and so I am prepared to wait till I can get reasonably high price from any potential buyer (Smith, 2002, p.25, Swart, p.203). Thus by applying the instrumental value I will look at the various influencing factors before I set the selling price of my house so as to attract the best possible buyers. Application of personality theories Myer Briggs Type Indicator Myer Briggs Type Indicator (MBTI) has divided people into groups based on four different dichotomies – extraversion-intraversion (EI), sensing-intuition (SN), thinking-feeling (TF), and judgement-perception (JP) (Engler, 2008, p.85). There can be 16 personality types indicated by this theory. I consider applying ENFJ personality type in order to sell my house to the best potential buyer at a price that is suitable for both me and the buyer. Extraversion is that aspect of personality trait that indicates social networking capacity, talkativeness and ability to express one’s views in a clear manner. For selling my house I will need to meet potential buyers from diverse social and economic backgrounds. Therefore, it is important that I need to use my social skills in a more competent manner so as to convince the buyers about the advantages and benefits of my house. The trick is to highlight the positive aspects of my house. I need to convince the buyers the advantage of living in a locality that is in close proximity to hospitals and supermarkets. By using my intuition power I need to ascertain the preferences of potential buyers. I will then communicate by using buyer’s preferred mode of communication, and design the selling contract that will be suitable to the buyer’s preference. It is also important to develop feeling to understand the emotional needs of potential buyers and accordingly I need to project the aspects of my house. For instance, if the buyer is a reflective person then I will emphasize on the unrestricted views that can be seen from the balcony. Finally, I need to use my judgement prowess to understand the authenticity of the buyer’s desire to buy a house. The Big 5 Model Next, there is the big 5 model of personality traits model that can be applied in accordance with my decision to sell my house. The big 5 model captures the five basic variations in human personality – extraversion, agreeable, conscientiousness, openness, and neuroticism (Nevid, 2012, p.492). By being an extravert I will be able to make comfortable interactions with potential buyers so as to judge their needs of buying a new house and the maximum price that they are willing to pay. Also, my exhibiting certain level of enthusiasm and energy in my personality will convince the buyers I really need to sell my house and this will convince them to go ahead with the legal formalities. However, I need to be caution so as not to exhibit too much extraversion as research has shown a weak link between extraversion and sales performance (Grant, 2013). By showing too much enthusiasm I can give the impression that selling house is my urgent requirement, and this can induce the buyers to lower their price hoping that I will sell at lower price. Therefore, I need to adopt a more reserved approach while dealing with potential buyers for my house. The agreeable aspect of personality can be actually detrimental to sales. This is because people who are agreeable means that they are sympathetic, trustful and compassionate towards others. Therefore, by being agreeable I will allow potential buyers to approach my sympathetic facet. Considering the buyers are in need of a house in a similar locality like the one in which my house is situated, but they do not have the necessary cash that will match the price of my house then by being agreeable I may end up giving them generous discounts. Moreover agreeable sellers can be eager to seal their deal and therefore end up agreeing to the terms of the buyers (Barzegar et al., 2010). Hence, I need to be more formal and strict in my approach while dealing with potential buyers. Then there is the third variation in the big 5 personality trait model that I can duly apply while attempting to sell my house to potential buyers. A seller with personality trait conscientiousness can be dependable, honest and organized. In this context, I will approach the potential buyers in a more honest and straightforward manner so as to gain their confidence and trust. For one, I will not try to hide any anomalies in my house. For instance, if my house requires repairing then I will be informing the potential buyers of the same. However, as already stated in the above section, I will be using the rational approach while offering a house that will require minimum repairs. It will be prudent for me to make necessary repairs at low cost to avail higher price. On the other hand, by approaching my personality trait conscientiousness I will inform the potential buyers of any other aspects of this deal that they need to know like the minimum price that I will agree on. Openness in a seller is another positive personality trait since it implies using one’s experience and knowledge to deal things with advance planning. Being a seller, I can gain the trust of potential buyers by being more open regarding the flaws and best features of my house. Hiding flaws will not do any purpose since potential buyers may decide to have a home inspection before they finalize their purchase. Neuroticism aspect of personality indicates a person’s ability to stay calm and stable under pressure, and one’s tendency towards exhibiting anger and impatience when things go wrong. It is important that exercise calm and presence of mind when negotiating price and other details with potential buyers. Recommendations Choosing an agent I am comfortable working with is the most important of the considerations after deciding to choose to sell the house through a real estate agent. Since real estate agents reflect the needs of the parties involved in a transaction, therefore comfort is necessary (Long, 2007, p.28). Agents have additional responsibilities of disclosing every little detail of transactions to the parties (White, 2001, p.39). I have the responsibility of carrying out research on available agents to ensure that I arrive at the most reliable. Applying proper theories can ensure proper dealing in any kind of business or commercial transaction. Since selling a house is also associated with emotional feelings as one may have lived in that house for many years, therefore I will recommend an ENFJ personality type approach when dealing with potential buyers. The price of the house needs to be set keeping in mind the desirable goals to achieve. Setting high price can deter potential buyers if other factors like locality, physical condition, and seller’s motive are not considered. Experts recommend renovations that add value to the house. Examples of renovations are tidying the pantry and cupboards, having the knobs for your appliances and that they work and getting rid of clutter. Additionally, others are sweeping, or water blasting the path and driveway, replacing any light bulbs that do not work (Megarry & Wade 2000), and cleaning your oven and kitchen thoroughly. Conclusion The idea is to get the best possible deal when I am deciding to sell my house. Although price is the topmost criteria I will also consider emotional and rational factors associated with the sale. Setting a high price will not serve the required purpose since emphasis needs to be given on all the factors that will allow buyers to make their decision. Exhibiting too much enthusiasm can give the buyers the impression that the seller is trying to hide something or is in urgent need of cash, and this can be a disadvantage for the seller. References Barzegar, A., Jahanbani, A. & Roozmand, O. (2010) Openness, Conscientiousness and Stingy for Buyer and Seller Agents in Electronic Marketplace. International Journal of Computer Theory and Engineering, 2(3), 358-63 Berges, S. (2011) The Complete Guide to Real Estate Finance for Investment Properties, John Wiley & Sons Engler, B. (2008) Personality Theories, Cengage Learning Grant, A.M. (2013) Rethinking the Extraverted Sales Ideal: The Ambivert Advantage. Psychological Science, 24(6), 1024-30 Hayton, C. & Marshall, O. (1996). Commentary and Cases on the Law of Trusts and Equitable Remedies 10th Edition, London: Sweet & Maxwell Hitchner, J.R. (2003) Financial Valuation: Application and Model, John Wiley & Sons Jones, G.R. & Mathew, M. (2008) Organizational Theory, Design, and Change, Pearson Education Long, D. (2007) Ethics for the Real Estate Professional, Cengage Learning Megarry, R. & Wade, W. (2000). The Law of Real Property 6th Edition, London: Sweet & Maxwell Nevid, J. (2012) Psychology: Concepts and Applications, Cengage Learning Schram, J. (2006) Real Estate Appraisal, Rockwell Publishing Smith, E. (2002) Commercial Real Estates: Understanding Investments, Dearborn Real Estate Swart, N. (2004) Personal Financial Management, Juta and Company Vinson, D.E., Munson, J.M. & Nakanishi, M. (1977) An Investigation of the Rokeach Value Survey For Consumer Research Applications. Advances in Consumer Research, 4, 247-52 White, D. (2001) Maryland Real Estate: Practice & Law, Dearborn Real Estate Read More