I mostly appraise commercial properties, not residential properties. The two types of owners are indeed very different in their outlook and their level of sophistication. That only makes sense if you think about it. A home does fill certain functional needs (shelter), but then again so does a rental apartment; so that’s not it.
The difference is that a “home” also fills certain emotional needs, too. You know the bombastic Mercedes commercials where the current tagline is “around here, you have to LOVE what you drive”? What they’re really saying is “around here you ARE what you drive”. The same is also true when it comes to homes. There are a lot of people who define themselves by what their occupation is, what kind of car they drive, and what kind of home/where they live; and not necessarily in that order. I don’t mean that as some sort of criticism because emotional needs are a part of life too. I’m just sticking it out there as an explanation why residential real estate is not generally considered to be just another asset.
Telling someone their home isn’t worth as much as they think is exactly like telling them that THEY aren’t worth what they think. They aren’t as smart as they think they are and they don’t have as much social standing as they thought they had.
People often take that kind of information very poorly. I have often seen that wounded expression on their face, as if I’d punched them in the stomach.
In my opinion the ride down is going to be as traumatic emotionally as well as financially for those people who are forced to actually take the trip.
