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Real estate investment psychology
by Jeanette Fisher
Satisfying and lucrative real estate investment depends upon
your correct assessment of profit potential, of course, but
your ultimate success depends on your ability to transform a
fixer into a dollhouse. The renovation process involves
physical work and choosing the best supplies, in order to
create maximum positive emotional effect and profits.
By incorporating the psychology of residential design, you
can make wise choices in transforming your fixer house by
using colors, textures, building materials, and decorations
that will assure a future speedy and cost-effective sale.
The psychology of residential design addresses the entire
home, inside and out, but the techniques of Transformation
Psychology are a bit different, because your ultimate goal is
different. The use of Design Psychology in your personal home
is much more individualized, while renovating a doghouse into
a dollhouse integrates more generalized design ideas to
create a home that will be appealing to a broader spectrum of
people.
Using Transformation Psychology to increase your real estate
profits means that you must learn how our human senses and
emotions are affected by our decorating details and choices
of materials. Buyers view a prospective home with their eyes,
but their brains interpret what they see and feel according
to subtle touches you have purposefully put into your house.
Process of Transformation Psychology
Your goal is to create a glorious home that buyers won't be
able to live without, and that process begins with planning
all the changes that will be necessary, from inception to
realization, in order to accomplish a total makeover of the
house.
Color Psychology
Determine your potential buyers' income level and your
selling season. Use simple colors for less expensive houses
and complex colors for upscale markets. Add in warm colors to
attract buyers during cooler weather and cool colors to
attract buyers during hot weather.
Texture Psychology
Many investors fix up houses to flip without considering how
the vacant house will "feel" to prospective buyers. This
isn't a problem in hot selling markets, but selling a vacant
house in a buyer's market means you need to outshine the
competition instead of pricing your home lower.
Vacant houses often feel cold with all hard surfaces. Avoid a
boxy, hard feeling by adding soft textures. Window coverings,
towels in the bathrooms, and a lightweight round table with a
fabric tablecloth add texture to soothe the buyer's emotions.
Buy Materials with Drama in Mind
Instead of buying the cheapest lighting fixtures, cabinet
hardware, and other building materials, look for additions
which buyers fall in love with. This doesn't mean you need to
spend more, just be selective. We found an awesome chandelier
for only $25 at Restore (Habitat for Humanity's thrift
store); I found matching wall scones at Lowe's (where the
chandelier sold for $300). Paying $50 more for the wall
scones than most investors would have meant little when the
house sold for more than any other home previously sold for
in the neighborhood.
We love taking a dirty doghouse and turning it into a
marvelous dollhouse, and we're willing to invest more time
and money than the average investor in order to achieve a
truly dramatic transformation. We usually spend about $12,000
for each renovation, which includes the cost of materials and
outside help. Many investors spend much less, but they make
less profit when the property sells.
Real estate investing takes skill and planning, but using
Transformation Psychology can give you a competitive edge,
taking a doghouse and turning it into the kind of dollhouse
that buyers will stand in line to bid on.
Professor Jeanette Fisher, author of Doghouse to Dollhouse
for Dollars, Joy to the Home, and other books teaches Real
Estate Investing and Design Psychology. For more articles,
tips, reports, and newsletters, see http://www.doghousetodollhousefordollars.com/
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