The three types of buyers in the current market
It is my experience that there are predominately three types of buyers.
Emotional – these will pay the highest price as they are buying with their heart.
Probable – they will buy but will only pay up to a certain point, once it surpasses that, they are out.
Mathematical – unemotional buyers who base their decision on financial return, mostly investors or those purchasing through their SMSF.
Obviously to achieve the highest price, you want to attract the emotional buyers, but how do you do this?
It has been said time and time again, but presentation really is key. First impressions are everything. A buyer needs to be able to imagine themselves living there; dinners around the table, relaxing in the living room, watching their children play in the backyard or swimming in the pool. In a slower market the only homes that sell in a timely manner for a great price are those that stand out and attract the most attention online, resulting in the highest buyer inspections and the most emotional connections.
In a boom market, many of the numbers at open homes are “researchers”. They are checking out the competition, gauging what prices are being achieved, researching agents and seeing how others prepare their home. In a slower market you know that the buyers who are out looking are committed and serious about buying.
This is when the skill of a good agent comes in, a home never just “sells itself” but in a strong market it can be a faster process. In a more conservative market a skilled agent must encourage second and third inspections, cross-match buyers to the property from their contacts and database and extract offers.
Buyer service is everything, agents and their team must make it as easy as possible for buyers to do their due diligence. Your agent must actively follow up buyers, provide them with all the information on a property they could possibly need; floorplans, site reports, contracts, building reports, private inspections etc.
With banks tightening up their lending criteria, cash is king right now. Buyers who have pre-approved finance are far ahead, ready to act quickly so they can snap up the property they’re after. Banks are still lending, albeit more conservatively, so leaving plenty of time to have this organised is imperative.
You can’t control the price; however, you can control the process.Posted by