Posted by Stuart Neal on Friday, October 6th, 2017 at 6:05pm.
Before you sell your home, you should learn about the distinct kinds of home buyers available to you. Together, these different buyer groups form the ‘whole’ market.
Try to think of the home sale market like a ‘layer cake’. Each layer has particular characteristics and the quality of the buyers you meet and your outcome may be affected by which layer you sell into.
We like to think of these layers as:
- Retail layer,
- Wholesale layer and
- Sub Wholesale layer
Here is a quick overview of each layer:
This is the top layer of the market, where most homes and condos are sold.
In this layer, you will be exposed to the highest quality ‘retail’ buyers.
Retail buyers are expecting to see well-prepared homes, they expect to enjoy an easy streamlined purchase experience and they expect to be safe in their decision.
In return, retail buyers will pay you full market value, that is, the most money.
Retail buyers will avoid ‘for sale by owner’ if they can. Retail buyers usually choose with work with their own buyer agent REALTOR ®, or they will approach the listing REALTOR® directly.
Retail buyers are going to rely on: purpose-built websites, the Internet, social media like Facebook & Instagram to find their next home.Open Houses and newspaper advertising are redundant.
Unfortunately for you, this is often the most expensive layer in which to sell your home. Why? Because this is the layer that traditional REALTORS® service.
Traditional REALTORS® may charge high commissions for several reasons:
An alternative would be to find a fee-based service program such as the one offered at Ambergate Realty Advisors. With our program, you pay a little at the start to save a lot at the end.
This is the middle layer of the market. In many cases, you will be approached by experienced investor types looking for a deal and some people of the ‘retail’ buyer group mentioned above.
You will find these buyers by purchasing a “for sale by owner” service such as Comfree, now called PurbleBricks (an online company from the United Kingdon, or by listing with one of the discount brokerages.
There are 3 challenges to this approach:
Expect to receive lowball offers.
We hear of countless situations where sellers in this segment received offers, but they were well below expectations.
This is the bottom layer of the market. If you restrict your advertising to a homemade ‘for sale’ sign and advertise on free websites like Kijiji, you will most likely meet 2 kinds of buyer.
The first group is predatory investor types. They are looking for home sellers who don’t know the market, or the true value of their homes. They are looking for great ‘under market’ deals.
Expect very low offers.
The second group is a little more colorful. These folks may be challenged by: no credit history, poor credit history and in some cases poverty. Expect these buyers to ask about no money down and rent to own options.
We have noticed that lower-priced homes and condos can be sold this way, but not without a lot of time and effort.
Want more information about our discounted flat fee home selling programs? Please feel free to call our broker-owner Stuart Neal.
Note this blog was first published on www.LowerRealtyFees.com in early 2015. It was revised, updated and reposted on www.AmbergateHomes.com in October 2015. It was later revised and updated in October 2017.