{"id":2500,"date":"2016-07-15T17:02:40","date_gmt":"2016-07-15T21:02:40","guid":{"rendered":"http:\/\/dankrell.com\/blog\/?p=2500"},"modified":"2016-07-15T17:02:40","modified_gmt":"2016-07-15T21:02:40","slug":"friendly-advice","status":"publish","type":"post","link":"https:\/\/dankrell.com\/blog\/2016\/07\/15\/friendly-advice\/","title":{"rendered":"About friendly advice"},"content":{"rendered":"
\"friendly<\/a>
Human behavior (from thediagonal.com).<\/figcaption><\/figure>\n

Home buyers and sellers often seek advice from others.\u00a0 Even when they\u2019re working with a professional who provides expert guidance.\u00a0 You might think it’s good to get validation from others on your real estate decisions.\u00a0 However, a Vancouver consumer study suggests that following friendly advice may be a bad idea (Friends give bad advice<\/em><\/a>; The Sun,<\/em> 4\/14\/2011, p29).<\/p>\n

Research of consumer psychology and behavior have time and again found that consumers want to be correct in their choices.\u00a0 They want to feel good about their decisions.\u00a0 They want to believe that their purchases are the best, and the professionals they choose are tops in their field.\u00a0 Consumers are known to behave irrationally to prevent the cognitive dissonance that occurs when they are confronted with conflicting thoughts about their choices. And that means they often make poor decisions.<\/p>\n

Mintel<\/a>\u2019s American Lifestyles 2015<\/em> report indicated that 69% of those surveyed sought out product and service reviews before purchasing.\u00a0 While 57% of those surveyed sought out recommendations from social media.\u00a0 Given the finding, it is suggested that there may be emphasis for communal thinking over \u201cindividual preference.\u201d\u00a0 However, about 38% of those surveyed considered independent review websites as \u201ctrustworthy;\u201d while 34% found them useful.\u00a0 But, 31% found social media contacts trustworthy; while 25% found them useful (Seven in 10 Americans seek out opinions before making purchases<\/em><\/a>; mintel.com; 6\/3\/2015).<\/p>\n

Seeking out friendly advice is part of herding behavior, which has been found to be a part of our everyday decision making process.\u00a0 A groundbreaking study of home owners\u2019 decisions to walk away from their mortgages (strategic default) during the great recession revealed how people seek and give advice (Luchtenberg & Seiler (2013). The effect of exogenous information signal strength on herding<\/em><\/a>. Review of Behavioral Finance, 5(2),153-174).\u00a0 The study concluded that people tend to seek advice when they feel that their choice is not in agreement with others.\u00a0 While advice was readily given by those who felt their choices were believed to be the consensus.<\/p>\n

Buying and selling a home may not always feel as if it is a rational process. And you may think it logical to seek friendly advice.\u00a0 However, indiscriminately following advice may not be the best practice because all real estate transactions are different.\u00a0 Each transaction presents a different set of variables such as personalities, market conditions, contract terms, etc.<\/p>\n

Given the research, more often than not, you are doomed to follow the advice<\/a> of a friend or family member \u2013 even when confronted with the evidence that the advice is ill advised.\u00a0\u00a0 You can infer from the Vancouver study mentioned earlier that friends and family feel \u201cpressured\u201d to give you advice on your real estate transaction because they want to be helpful.\u00a0 Furthermore, herding research suggests that you probably give emphasis to advice from friends and family because following their advice will likely make you feel you are \u201cdoing the right thing,\u201d as well as increase your acceptance by them.<\/p>\n

Regardless of your rationale, your real estate decisions are most likely based in psycho-emotional needs and\/or fears (such as status, acceptance, and avoidance of failure).\u00a0 Breaking away from the herd is difficult.\u00a0 Improve your decisions <\/a>and make your transaction successful by pursuing balanced information and becoming aware of your motivations.<\/p>\n

Copyright \u00a9 Dan Krell<\/p>\n

If you like this post, do not copy; instead please:
\nreference the article<\/a>,
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\"Protected<\/a>
\nDisclaimer<\/a>. This article is not intended to provide nor should it be relied upon for legal and financial advice. Readers should not rely solely on the information contained herein, as it does not purport to be comprehensive or render specific advice. Readers should consult with an attorney regarding local real estate laws and customs as they vary by state and jurisdiction. Using this article without permission is a violation of copyright laws.<\/p>\n","protected":false},"excerpt":{"rendered":"

Home buyers and sellers often seek advice from others.\u00a0 Even when they\u2019re working with a professional who provides expert guidance.\u00a0 You might think it’s good to get validation from others on your real estate decisions.\u00a0 However, a Vancouver consumer study suggests that following friendly advice may be a bad idea (Friends give bad advice; The … <\/p>\n

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