Published May 29, 2019
3 Types of Buyers to Consider When Pricing Your Home
3 Types of Buyers to Consider When Pricing Your Home
When considering the market price of your home, it pays, literally, to know what type of buyer you may encounter. Let me introduce you to three types of buyers before deciding on your homes list price.
#1 NEW AND WAITING BUYER
The New and Waiting Buyers are sitting and waiting for new inventory to come on the market. These are the BEST buyers; they are the most emotional, they will pay the most, and they are motivated...and usually the easiest to work with.
#2 DEALER BUYER
The Dealer Buyer comes in and wants to “wheel and deal.” They usually show up 180 days after the property has been on the market. They’re in a lot of ways a nuisance to a seller because a seller doesn't want to wheel and deal their most important asset away.
#3 BOTTOM FEEDER BUYER
The Bottom Feeder Buyers are the ones that come in a little bit later and lowball in an effort to steal the property. It’s certainly a fair business practice; they may be looking to flip a property and make a profit.
ATTRACTING THE RIGHT BUYER
When a seller tells me they want to build a cushion in and leave room for negotiation, what they are doing is catering their price to the #2 buyer, the Dealer, and that is not who you want to work with. If you price the property to attract Dealers, then you’ll attract Dealers. What you want to attract is the New and Waiting Buyer. They are going to jump when they see your property hit the market and it’s priced at fair market value. The New and Waiting Buyer doesn't deal when they see a property they like...they BUY it!
So, before you set your list price, remember you don't want #2 or #3 buyer, You want the #1 buyer. They pay more, they are more emotional and way more motivated.
FINAL THOUGHTS: Price plays a role and it has to be evaluated, but it's not everything. Good advertising, good promotion and solid exposure for property make a dramatic difference. When we hang a blue and white Sotheby’s sign in our client's front lawn, it sends a very clear message to the market; they hired the best agent, they know the value of their home, and they intend to get it.
