Ankerheuristik

Anchoring heuristics influence decisions by making individuals rely heavily on the first piece of information they encounter.

Consider Tom, a first-time homebuyer who is looking for a residential property.

Jane, a homeowner, lists her house for $600,000 despite her real estate agent, Mark, advising that the market value is closer to $550,000.

Mark suggests the higher price as a negotiating tactic, but Jane becomes anchored to the $600,000 figure, believing her house is worth this.

When Tom visits the property, he finds it appealing but has a budget of $570,000.

The $600,000 anchor influences his perception of value, making him feel that offering $580,000 is a fair compromise.

Jane, anchored to her initial price, rejects the offer, viewing it as too low.

After some negotiation, Jane lowered her expectations slightly to $590,000.

 Still influenced by their respective anchors, Tom and Jane struggle to agree.

Eventually, they settled on $585,000, which is above the market value but feels acceptable relative to their anchors.