Similar to how buyers might experience buyer’s regret, sellers can also experience seller’s remorse. Long after the sale process is started, some have second thoughts about selling their houses.
Homeowners frequently have seller’s regret since they were initially unmotivated.
Occasionally, individuals believe they wish to sell when they do not actually have a compelling motive to do so.
It can also be a very emotional choice that will inevitably provoke second thoughts.
What is Seller’s Remorse?
Seller’s remorse is a seller’s emotional response after a sale characterized by regret about the transaction.
People can suffer seller’s regret about even the smallest of objects, like selling a teapot. Typically, seller’s remorse occurs when major items are involved, such as houses, businesses, or vehicles.
Before putting things up for sale, it would be wise to anticipate the possibility of experiencing seller’s regret.
A seller of a Victorian fourplex in Sacramento chose to list his house because he believed the market was dropping. He believed that if he waited a few more years, the value would drop so low that he would lose all chance of making a profit.
When his agency presented him with an offer, he panicked. He concluded that he could not actually sell his 16-year-old home for any price. At the moment of signing, he froze.
The Origins of Seller’s Remorse
Moving is one of life’s most stressful events. According to Daryl Cioffi, a psychotherapist in Rhode Island and co-owner of Polaris Counseling & Consulting, this is one of the most significant causes of sadness.
“Change brings forth a great deal of latent phenomena,” adds Cioffi. Do you experience insecurity? Are you questioning whether or not you made the best choice?
These emotions are typical responses to change; but, when they get intertwined with the selling of your largest investment, they may be downright scary.
You can handle the emotional roller coaster that accompanies the sale of your house by taking the following steps:
Do the Emotional Work Beforehand
The greatest approach to avoid regret is to perform the emotional work before to selling.
“Look at the issues that make the home unsuitable for you,” Cioffi advises. Is the home simply too tiny for your family? Your Great Dane may require a larger backyard. Consider, “How do I conclude this chapter?”
This does not need developing unfavorable thoughts towards your existing residence. You’re only trying to remember why you chose to move on.
“Begin the process of separation by stating, ‘This is working for me right now, but it won’t forever,'” advises Cioffi.
Allow yourself time to grieve the house you’ve loved and the memories you’ve made within its walls once you’ve processed the reasons for selling.
It is acceptable to feel sorry that you will never again enter your child’s first bedroom; but, that is not a justification to remain in a house forever.
You can even have fun while grieving. Why not recognize your emotions by throwing a house-closing party?
Focus On the Future
Even if you spent time grieving before putting your home on the market, it’s normal to feel sadness during the closing process. It’s simple to convince yourself that you’re overreacting, but it’s difficult to overcome regret.
How do you plan to do this? Prepare yourself for the future as you bid farewell to your previous residence. If you’re still experiencing guilt after the transaction has been completed, don’t overthink it:
Even if you made the incorrect option, which is unlikely, it doesn’t matter. The action has been completed.
The following stage is diversion. If you have already moved into your new house, you should devote yourself to making improvements. Kitchen shelves need be redone.
Start a garden. Primavera suggests fully diverting your attention away from homes by starting up a new hobby or exploring your new community to find enjoyable activities, such as yoga or pottery workshops.
“Keep your attention on the future,” advises Cioffi. “In actuality, it is completed. What then? Consider the future and how you may make this new location something to be thrilled about.”
If you are still having trouble adjusting to your new life, your former house may be a stand-in for more significant issues: Moving may have made your depression worse, or it may have sparked concern about your life in general.
You should discuss your problem with a competent counselor if you are unable to overcome your sadness after an extended period of time.
A skilled therapist, according to Cioffi, will assist you answer the question, “What is it that you can’t let go of?” What is preventing you from moving forward?
Regardless of the severity of your seller’s remorse, recognizing its causes and concentrating on the future are the most effective strategies to overcome the trauma of leaving a previous property.
Allow yourself time to adjust to the change and concentrate on forming new memories. After all, the reason you were so attached to the property you sold was because of the pleasant times you spent there.
With time and a fresh collection of memories, you will come to appreciate your new house just as much.
Do You Really Want to Sell?
Owners may avoid seller’s remorse by carefully considering the entire selling process and creating a strategy — a relocation objective — that outlines compelling reasons for selling.
List the advantages and disadvantages of selling on two separate lists. If the advantages outweigh the disadvantages, you ought to sell. Otherwise, you should not list your house for sale.
If a homeowner is concerned that they won’t be able to find a suitable replacement house following the sale of their current home, contingent contracts might be utilized.
The seller is not required to close escrow with the buyer if a replacement house cannot be identified during the contingency period.
It’s Probably Going To Hurt
Even if you have compelling reasons for moving on and relocating is more of a positive than a negative, you should expect to experience grief. Expect pressure.
If you’ve raised a family in the home or have other significant memories linked with it, you’ll be better equipped to handle emotional outbursts as the closing date approaches.
When is it too late to back out?
Regardless of how a seller feels about selling their house, they have a limited amount of time to act on those sentiments.
After five days have passed since the establishment of a completely completed purchase agreement, it becomes exceedingly difficult to withdraw from a real estate deal.
There are regulations that govern real estate transactions, and the seller may be required to adhere to the terms of the contract regardless of how they feel. If they continue to press the matter, they may find themselves in court with the purchaser.
If a buyer sues a seller for attempting to back out of a deal late in the game, both parties will spend a significant amount of time and money on this dispute. This is especially aggravating for the buyer, whose cash deposit is now held up in escrow.
If the seller breaks the contract, the buyer can claim for damages, and their attorney may seek to recuperate any money spent on expenditures such as temporary accommodation and storage for their possessions if they believed they were about to relocate and sold their house or quit their rental.
The seller may also be responsible for legal fees, inspection fees, survey charges, and HOA application fees. The seller should carefully consider if keeping their house is worth the prospective costs and hardship.
What options do sellers have?
Obviously, not every seller with seller’s regret ends up in court. If you decide at the last minute that you want to keep your house, you should first examine your lease to determine whether you have a contractual out.
For instance, your contract may stipulate that you must find a suitable replacement residence before the sale of your property is finalized. Or perhaps you need the consent of a certain family member in order to sell.
Consult your real estate agent on your available possibilities. You may be able to establish that you fit the criteria for a contractual out clause. Ultimately, the buyer cannot demonstrate that you cannot find a suitable replacement house.
These are a few frequent instances in which sellers can back out of a house transaction without repercussions:
You have not signed the contract yet. If you have not yet signed a contract, you are free to withdraw from the agreement at any moment.
The contract is still within the five-day timeframe for legal review. If you choose a normal real estate contract, you will have a five-day attorney review period, during which any party’s attorney may cancel the agreement for any reason.
You are allowed to withdraw from the transaction without incurring any penalties. The contract has an exit clause. Similarly to the purchase of a new home, if you include a clause in the contract that allows you to back out without penalty, you can also keep your current home.
The buyer is in breach of contract. You may cancel the contract, for instance, if the buyer fails to obtain a mortgage within a certain time limit.
The vendor will not comply with repair requests. Playing hardball with the purchaser is one technique to escape a house transaction.
The buyer can “constructive cancel” the real estate contract if the seller refuses to make specified repairs requested by the buyer following an inspection.
What if you’re already at closing?
You may still attempt to withdraw on the last day of the transaction. In the past, judges seldom compelled homeowners to sell their property.
Again, the buyer and your real estate agent have the option to seek damages at this stage, but if you’re adamant about walking away, you probably can.
What might happen if you decide to back out?
In rare instances, if the seller has second thoughts and wishes to withdraw from the transaction, the buyer may opt to just walk away.
They may not consider retaliation worthwhile. Alternatively, it may be worthwhile for the buyer to pursue damages if your choice to withdraw from the transaction resulted in significant hassles and financial losses.
The seller will be required to repay the earnest money if they decide to back out of the sales agreement, but they may also be required to compensate the buyer for expenditures including:
- Housing available for short-term lease
- Lost deposits
- Storage expenditures
- Fees for inspection and survey
- Legal expenditures
You also run the danger of your real estate agent being less than thrilled with you. Remember that they invested a great deal of time, effort, and resources in locating a buyer for your house.
They may sue you for your lost commission and any marketing costs invested to advertise your house to potential purchasers. As they are accustomed to these sorts of setbacks, the likelihood is that they will simply go on, but there is no assurance they will not seek restitution.
How do you help yourself move on?
The mere fact that you have seller’s remorse does not imply that you will choose to take action. So, how can you make it simpler to go on?
Consider the inevitable. You must understand that it is time to say goodbye not just to your residence but also to the memories it holds.
Try to confront the truth that you intend to leave your house head on. Try to feel excited about your new house and the memories you will build there by taking photographs and sharing tales with your family.
Permit yourself time to grieve. Even while your new house will have many beneficial attributes (larger yard, closer proximity to family, etc.), you will miss certain aspects of your previous residence, and that’s alright.
You must lament the loss of the home that contained joyful memories and provided the comfort of familiarity. It is beneficial to shed a few tears.
Commemorate the novelty. A new community, employment, or neighborhood will provide considerable benefits. Focus on what you have to look forward to, rather than what you are leaving behind.
Be forthright with yourself. Maybe you did made a mistake. Perhaps it was not the most advantageous time to sell your new home. That’s okay. You can learn from the error and concentrate on how to move forward.
Remember that although change might be frightening, it is often beneficial and promotes our growth. There’s no reason to believe that your new life won’t be as fulfilling as the one you’re leaving behind, despite the fact that it may be difficult to imagine.
How a Seller Can Cancel a Listing
A listing agreement is a legally enforceable contract between a seller and a real estate agent. It is true that not all listing agents obligate the homeowner to sell the house if they change their mind, but the same holds true for the homeowner.
Also, not all agents will permit a seller to cancel, so this may be a point to address prior to signing a listing agreement.
Exclusive right-to-sell listings are prevalent, and they entitle a broker to a commission if a ready, willing, and able buyer submits a full-price offer to purchase. Homeowners with seller’s remorse can cancel these listings, but if the broker performs, they may owe a commission.
Do not sign a six-month listing agreement if the agent will not abide by your request to terminate the arrangement. Inquire about the length of the listing and whether it is possible to shorten it.
Many real estate agents have positive reputations in their communities and are willing to cancel a listing; however, you should inquire about this before signing.
Cancelling a listing can also be a lengthy process, as only a real estate agent or management can do so. Actually, the listing does not belong to the agency.
Before pulling the plug, you should consult with the real estate agent, the agent’s broker, and maybe a real estate attorney. At some point, you should be able to reach a compromise that is acceptable to everyone.
When Seller’s Remorse Occurs at Closing
Few things are more disheartening for all parties involved than enduring the home-inspection process and making it all the way to closing, only to learn that the seller did not show up.
Although there have been a few isolated court instances in which judges ruled against these homeowners, the court will not often order a seller to sell.
A potential purchaser often retains the right to seek damages and sue a non-performing vendor; however, at that time, brokers will likely have earned a commission and have the right to demand payment.
The signs of seller’s remorse
Seller’s remorse can show as worry, unease, or even sadness. There may be a sensation of losing out on memories related with the object, as well as sorrow about change.
In certain situations, individuals may develop physical symptoms, such as a rapid heartbeat or difficulty sleeping. It is vital to think on your decision if you are having seller’s remorse.
You may feel more at ease with the transaction when you’ve had time to digest your feelings.
How can I prevent Seller’s Remorse?
It is considerably simpler to prevent seller’s remorse than to treat it. When you decide to sell, you will be less likely to face regret once the sale is finalized if you are armed with the following advice.
Have a good reason to sell.
Comparable in significance to getting married or having children, the sale of a firm is a monumental achievement. Consider why you want to sell before you pull the trigger.
Retirement, burnout, deteriorating health, and the desire to explore other interests are all excellent reasons for leaving a firm, since they provide for life after the company.
If you are unsure of why you want to sell or if your motivation is not sustainable, you may come to miss your business and regret the sale.
Explore options & learn
The more your understanding of the M&A process and post-sale existence, the more control you will have. Examine all selling choices so that you are aware of all possible outcomes and can suitably plan.
Calculate the sales price you’ll need to maintain your present standard of living. Understanding the situation of your financial stability beforehand will help you assess if the time is ideal or whether you should wait. We advise involving a certified public accountant or financial advisor at this stage.
Be sure about your plan
Once you have explored your choices and have a clearer sense of how your life will change following the sale of your firm, give it some thought. Ensure that you truly desire to do this, that you have the financial means to do so, and that you are doing this for the correct reasons.
Find an agent
To prevent seller’s regret, it is vital to choose an M&A agent you can trust. Having someone on your side during the sales process is really beneficial, particularly if anything unexpected occurs. Find a firm that represents sellers while searching for a business broker.
Prior to contacting them, review some of their past transactions and client testimonials to gauge their repute. Your financial advisors and CPA may propose a broker.
Try not to second-guess your choice to sell, since our minds might stray at times. If you start to feel apprehensive, recall the excellent reasons that prompted you to do this in the first place and reassess your strategy.
Seller’s remorse is a common response to the sale of a meaningful item, but don’t allow fear or regret prevent you from achieving your goals! Every business owner has been in your position, and it is reasonable for them to question if selling their company is the best course of action.
If uncertain, it is best to delay selling until you feel more assured, and speaking with reputable consultants or business intermediates can steer you in the proper route.
As previously stated, preventing seller’s remorse is far simpler than curing it; thus, take the time to plan for selling your business prior to making a move.
What to do if you experience seller’s remorse
In some instances, if you suffer seller’s remorse during the sale process, it may be too late to cancel the sale without incurring financial penalties. There are, nevertheless, a few things you may do to attempt to lessen your regret.
First, discuss the transaction you’re contemplating with your loved ones and the reasons why you’re having second thoughts. Getting a third-opinion party’s on whether or not you are making a prudent choice can be useful.
Talk to a therapist or counselor if you are emotionally or physically unable to come to grips with the regret of your sell. They can help you make peace with your decision and handle your emotions.
Lastly, while making large purchases in the future, try to take your time and consider whether or not you will be satisfied with the item in the long term. There are methods for overcoming seller’s remorse and moving on.
How an agent can protect you from seller’s remorse
A competent real estate agent may be your greatest ally in several ways.
- Providing market information and context, such as local selling times, preparation work for the sale, and estimated costs and earnings.
- Assisting you in deciding whether selling your property is a priority
- Developing a purchase agreement that addresses your concerns and optimizes the value of your house.
As a potential seller, it is in your best interest to speak with many real estate agents before selecting one.
This will enhance your understanding of the sale and provide you with a broader range of recommendations. Just be careful to communicate your concerns and views regarding the transaction so that the agent can be as helpful as possible!
A listing agreement is a contract between a seller and their agent that details payment for promoting the property and the agent’s commission on the sale. You should not take this step until you have chosen a suitable agent.
Understanding the market
Real estate brokers have exclusive access to market data, which they may utilize to assist you in understanding how your transaction may proceed.
Here are some resources a broker can provide:
A comparative market analysis (CMA) gives an estimate of the worth of your property relative to comparable recently sold properties in your region. CMAs perform a lot of heavy lifting: they can assist you and your realtor set a realistic price for your house AND decide the optimal time to list it.
A seller net sheet estimates the amount of money you will earn from the sale. It provides the gross amount you would make from the home, minus expenses such as realtor fees, giving you a clearer picture of every dollar involved.
Local selling times are the average amount of time it takes sellers in your region to sell a house. You will have a more accurate timeframe for the sale process and will be better able to plan your own move.
Assessing your finances
With a greater grasp of your financial condition, your agent can assist you in weighing the benefits and drawbacks of selling your property, as well as alternative possibilities you might not have considered.
Alternatives to a sale include refinancing your mortgage or conducting a short sale if you are in a financial bind.
Refinancing your mortgage
Refinancing your mortgage might improve your financial picture while allowing you to keep your house, so preventing buyer’s remorse.
Refinancing your mortgage might dramatically cut your monthly payments. Your lender may provide loans with cheaper interest rates, no necessity for private mortgage insurance, or other advantageous variations.
Collaborate with your agent to locate a new loan that suits your needs.
Some homeowners may only consider selling if they have no other option. Inadequate financial health and the fear of foreclosure may be compelling them to reconsider.
A real estate agent could propose a short sale if foreclosure is a genuine risk for you.
If you owe more on your mortgage than your property is worth and you cannot make your monthly payments, you can negotiate with your lender to sell your home and get out of your mortgage.
A short sale is better to a foreclosure for several reasons, despite the fact that you’ll sell your property for less than you paid for it.
Since you’re going away with some cash, you may purchase your NEXT residence much more rapidly (unlike in a foreclosure).
A short sale has less of an impact on your credit score than foreclosure.
You have greater influence over the selling conditions and your relocation.
The process of a short sale can be difficult and take far longer than a foreclosure. You must demonstrate financial difficulty and persuade your lender to proceed.
Possessing a real estate agent with expertise in short sales significantly improves your chances of having your transaction authorized.
Including contingencies in a purchase agreement
A real estate agent might insert clauses in a purchase agreement that would allow you to back out if you change your mind.
The majority of contingencies in purchase agreements favor the BUYER rather than the SELLER.
Including a home of choice clause in your purchase agreement would allow you to back out of the deal if you’re unable to find a home that meets your needs and preferences.
However, home of choice clauses are neither common nor well-known. Typically, buyers are hesitant to execute a purchase agreement that contains such a high amount of uncertainty.
Before the purchase agreement is drafted, you should discuss your concerns with your agent and seek their counsel.
Helping you make the most money
An excellent real estate agent can ensure that your house sells for an excellent price. Things may be different if you attempt to sell without an agent.
A for-sale-by-owner (FSBO) home is one in which the whole sale is handled by the owner; no listing agent is involved.
If you are selling to friends or family, or if you have real estate expertise, selling FSBO makes the most sense. In certain circumstances, avoiding a real estate agent will save you money on commission and other expenses associated with using one.
However, there are disadvantages to selling FSBO. A FSBO home sells for 26% less than an agent-sold property, on average.
And if you’re uncertain about selling, adopting the FSBO way means forgoing the counsel and institutional expertise that a real estate agent offers. It may be worthwhile to pay a bit extra for an advocate of this caliber.
Seller’s remorse is a common response to the sale of a valuable item, but don’t allow your fear or regret prevent you from achieving your goals! It is normal for business owners to question if selling their company is the best course of action.
If uncertain, it is best to delay selling until you feel more assured, and speaking with reputable consultants or business intermediates can steer you in the proper route. As previously stated, preventing seller’s remorse is far simpler than curing it; thus, take the time to plan for selling your business prior to making a move.