Overcoming Buyer’s Remorse
In my daily advice and mentoring I find that many investors make a decision to purchase their first or next property quite confidently, only to be overcome by regret, fear, anxiety and self-doubt in the days or weeks following and pull out of the purchase. This is called buyer’s remorse and can haunt investors and stop them from reaching their goals of building a successful property portfolio. So why does this happen and how can you overcome this buyer’s remorse?
Fear of making a mistake
Fear is a powerful thing, especially when your emotions start taking over. After a few days you begin to doubt yourself and whether you have made a wise decision, even though you did mountains of research, got good advice and were sure of yourself. You start getting anxious and all the negatives flood into your brain. You may have a fear of not having chosen the “right” property, or of losing money if the market drops, of not having any tenants, or of the property being damaged, or of interest rates going higher in the future. It is much easier to just change your mind and let the anxiety go away and cancel the purchase. This may leave you temporarily feeling better, but you may also have to let go of your dreams and goals of a passive income, a secure retirement and of the lifestyle this would give you. And guess what, this pattern can keep repeating itself each time you get to the point of buying another investment giving you constant stress and anxiety! For every step forward, you end up five steps back.
Overcoming fear of the “unreal” needs lots of support and guidance. That is why having a property mentor or advisor to guide you through the process can help you avoid the anxiety and doubts. Buying property is a process and at each step of the way there will be more to learn and understand and having someone hold your hand can be a lifesaver. There is always someone there to answer your questions or concerns and help solve any problems during the finance, contract and settlement stage. If you have bought a well-researched , well located property in an area with strong drivers for growth present, good rental yields and low vacancy rates and it is cash flow positive be confident that you are well on your way to adding a quality property to your portfolio. Taking the emotion out of the equation is the key.
Negative feedback from others
Have you ever been so excited at buying a property you really wanted, being able to afford it, being happy with your decision only to tell your friends, family or work colleagues and have them come back to you with negative criticism and feedback of how stupid or silly you are! It can blow your self-confidence out of the water and increase your chances of having buyer’s remorse over the purchase. This negative feedback has brought many an investor undone as well-meaning friends and family can pour cold water onto your decision. You can get ill-informed opinions on the location being bad, the property being overpriced, the area being unsuitable even after months of due diligence and research on your part and no past experience or knowledge on their part!
Don’t tell the relatives or friends about your excitement of buying another property unless you know they are supportive and knowledgeable! Be very clear on your goals and what you are working to achieve through growing a property portfolio. You should not need to constantly justify yourself, and yet you do need to be strong to stand up to criticisms and ill-informed opinions of others. I would involve someone close that you trust to go through all the due diligence with you so that you have two heads working together and a strong support base. This person could be your mentor, property advisor or experienced investor who is on the same page as you and is helping you towards your goals, not creating roadblocks at every turn.
The key to overcoming buyer’s remorse is to have lots of support and guidance, trust yourself and be mindful of who you tell about your property decisions. Once you are a successful investor these same friends and relatives will tell you how lucky you are! You will know luck had nothing to do with it. Happy Investing!