Different Homes, Different Buyers

It may seem counter-intuitive, but just because two “For Sale” homes share the same block and are listed for the same price, doesn’t necessarily mean they’re direct competitors.

In fact, I can think of at least 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).

Two. Condition.

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 . . . .

See also, “Home Seller Exclusion Lists: Why the “Neighbor’s Best Friend’s Son-in-Law” Usually Isn’t the Buyer“; and “Prospective Home Buyers: “What’s Up With THAT Block?!?”

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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