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This week's blog post, is all about Real Estate buyers. Actually, what are the most popular types of home buyers. Let's even give them a fancy name, the "Top 5 types of Home Buyers."
Buying a home, is one of the most expensive purchases of your life. So it makes sense, that this list is more like one's journey through life. Each type of buyer, represents a certain point in someone's life.
First-Time Buyers: Before you can become a home buyer, you first need to buy your first home. So no matter at what point you are in your life, everyone, who buys their first home, is a first-time homebuyer.
More likely than not these are young professionals (single/couple), or young families just starting off on their journey. Again, they can be anyone.
Since this is their first home, most likely they are looking for something affordable, and if it is a young family. Something in a good school district too.
Sometimes you can't have both, in fact I know plenty of families that only got to their desired school district, after their second or even third purchased home. At that point they fall into a different type of buyer, that we will discuss later.
Now back to first-time homebuyers, so mostly likely their young. They can be idealistic, since it is their first time, they are excited and want to learn about the home buying process as much as possible.
They may be a little naive and make mistakes along the way, but the point is they are eager to get the process started. As an agent, you want to be there for them, and correct those mistakes, and make the experience as pleasant as possible.
Move-up Buyers: This next type are for the most part those families I discussed earlier. They were not just moving into a better school district, but also upgrading to a bigger home too.
So these buyers are selling or have sold their first home, and with the equity they have built up over time, are buying a bigger more expensive home.
Size isn't the only upgrade, they may want more amenities, and features too. The average homeowner stays in their home for 7 years, and everytime they move, they may be looking to upgrade. In that respect it is like buying a car, you always want your new car to be a bit better than your old one.
So what kind of people are Move-up buyers? Well they are most likely experienced in the home buying process, especially if it is there third or fourth go around.
They may be more focus on getting specifics in a home. Having laundry on the first floor, maybe a must have. They maybe willing to pay a premium for a good location (excellent school district) or specific features in a home.
Downsizers: So as life goes on, and you grow a family. Your house has to grow with it. Well once your kids grow up and move out, what are you suppose to do?
Sell and move into something smaller, right? Yes, so this type are mostly your older buyers that are looking for a simpler lifestyle. This may mean selling your colonial for a ranch or even a condo (no yard work).
What if you didn't have a family? You may have still wanted a big house, and now that you are retiring, you want to downsize. However if you do have a family, you may not only be downsizing, but also looking for something closer to them.
Investors: So you have bought, your first, second, and even third home already and love the process. Did you know not only is your personal home an investment, but buying property in general can lucrative.
Investing property is big business, whether you buy and hold to rent, or buy fix and sell (flip). Some have even made it their career, or a full-time job if you will.
An investor is always looking for a great deal, because at the end of the day, they are trying to make money. They are looking for properties in need of repair or rentals at below market values.
Did you know a first-time homebuyer can also be an investor. They are called househackers. The may buy a property of up to 4 units, and live in one, while the rents from the other units pay their mortgage. I know this to be true, because i met one.
For the most part, an investor is business-minded type buyer looking for a way to make a profit. They are willing to take on more risk in buying a property, because the reward may be great!
Well an investor buys properties however they can be it cash, mortgage, private lending, hard money etc. So yes an investor can be a cash buyer, and lot of them are.
Not all cash buyers are investors, they can also just be very wealthy people who can buy all in cash. Cash is still King, and if someone has the opportunity to buy in cash, that is in their best interest, unless interest rates are super low!
You don't have to be wealthy to buy all in cash. If you own your home free and clear, you can use the money from the sale of that home, to buy the next one all in cash.
An all-cash buyer can be beneficial in purchasing. They can buy the quickest without having to finance. This proves to be a great advantage when buying.
If a seller was looking at two offers, one could close in a week or two, while the other had financing and could take up to 6 weeks or more, which would you choose?
Well those are 5 types of buyers, which one are you? If you aren't part of the list, let me know what type of buyer I left out. I have worked with them all, and if you are in the market to buy, I would love to help you find your next property no matter what type of buyer you are!
