It may seem counter-intuitive, but just because two “For Sale” homes share the same block, are listed for the same price, and are the same size (have the same finished square feet), doesn’t necessarily mean they’re direct competitors.
In fact, I can think of two scenarios where there’s virtually no overlap in the pool of prospective Buyers considering both homes.
One. Floor plan.
A home with a deluxe, Upper Level Owner’s Suite (and only a small, second Bedroom) is going to appeal to a dramatically different kind of Buyer than a home with 4 Bedrooms up (and perhaps only a hall bath).
The target audience for the former is a professional single or couple, or a household with one, young child; the latter, a family with several kids (who can all share a Bathroom — or contemplate adding one).
Homes that need major remodels (Kitchen and multiple Baths) can be discounted as much as $150k – $200k.
Or if you prefer, homes in mint, move-in condition fetch a considerable premium.
But, at least in my experience, the pool of prospective Buyers for each type of home is discrete.
P.S.: So, when does it matter that there’s a competing home down the street?
When suddenly, there are multiple homes for sale.
Then, Buyers understandably wonder what’s going on . . . .