Last Updated on October 2, 2020 by HortonTeam
When it comes to selling your home, there are several types of homebuyers that you’ll most likely run into during the selling process. At first you might think that any sale is a good sale (looking at you, first-time home sellers), but that’s not always the case. Learn more about the five types of homebuyers in Newburgh and Evansville below.
When you’re trying to sell your home in Evansville, one of the five main types of homebuyers you may come across is the investor. An investor’s primary focus is to purchase a home, renovate it, and then sell the home for a profit. Because of this objective, investors look for homes that offer a margin in which they can spend money on renovations and still sell for more money than the cost of the home. If your home is in pretty decent shape, then there’s a good chance investors will pass over your home. However, if the home is in need of a lot of work, then you may end up receiving offers from these investors. If you need to sell your home quickly due to an upcoming relocation or because you don’t want to deal with the extended headache, then this option may work for you. That being said, these types of homebuyers generally make lower offers in an attempt to increase their potential profit margin. With that being the case, chances are you will make less money selling your home to a local investor.
2. Bargain Hunter
Another common homebuyer in Evansville is the bargain hunter. These types of homebuyers often scour the market for any homes for sale that are underpriced in comparison to the quality of the home or the area where the home is found. Even if a home isn’t underpriced from the start, these bargain hunters often submit offers that are significantly under asking price. Many of these offers will be rejected, but there are plenty of home sellers who need to unload a home quickly for various reasons—some may need to move for a work relocation, while others may just not like the process of selling a home. When these sellers meet with bargain hunters, the end result is almost always a return on the home sale that is much lower than what would be considered “top dollar.” As long as you don’t need to get rid of your home ASAP and are willing to make some minor improvements, you shouldn’t have to worry too much about these types of homebuyers.
3. Contract Sale or Rent-to-Own Renter
One of the most common types of homebuyers we find in the area is someone who desires to purchase a home on contract or through a rent-to-own arrangement with the seller. While most people have probably heard of the phrases “contract sale” or “rent-to-own,” they probably don’t know that these terms are two separate agreements with different sets of rules and stipulations. At the end of the day, the most important factor to know as someone trying to sell your home in Newburgh or Evansville is that neither of these options will bring you the most money for your home. These types of homebuyers usually resort to rental arrangements due to a poor credit score or a lack of funds required to purchase a home in your price range. While you may be tempted to go the landlord route, just know that selling your home on a lease option or rent-to-own basis always comes with a certain level of risk to you as the seller. There are few barriers in place to protect your home from potential issues, such as property damage or a buyer who becomes unwilling to pay or vacate the home. Of course there are some contract sales and buyer-tenant relationships that end up working out, but we never advise any of our clients to pursue that avenue.
4. Window Shopper
Even though the dreaded window shopper made our list, they really shouldn’t be considered one of the major types of homebuyers since they never end up buying a home! These people are generally on the fence about making a home purchase, and sometimes they have no plans to buy for several more years. We commonly see these people attending Open Houses or looking at homes for sale in Newburgh or Evansville online, but there is a chance they may want to see your home via appointment. Unfortunately there isn’t a great way to weed these people out before letting them into your home, but requesting to see a pre-appproval letter prior to scheduling a showing can sometimes help.
5. Diamond Hunter
The final spot in our list of types of homebuyers is the cream of the crop: diamond hunters. These homebuyers are looking exclusively for move-in ready homes that are in top shape. That means there is no wallpaper, no scuffed flooring, no tarnished light fixtures, and nothing else that makes the home appear unfashionable or outdated. Along with those issues, these buyers will also be turned off by non-permanent concerns found throughout the home and property (e.g. tall grass, clothes on the floor, cluttered garage). The good news is that most non-permanent issues can easily be corrected and improved, usually with little to no money required. When it comes to correcting outdated components of your home, cost can be a different story. You’ll usually have to put some money down, but don’t let that scare you. Some updates will instantly increase the value of your home—did you know new carpet usually adds two to three times the value of the cost of the carpet?—while others will help your home appear more attractive or desirable (which leads to a quicker sale). If you’re having trouble deciphering which updates will give you the highest return, we’re more than happy to share this information with you.
When thinking about selling your home in Newburgh or Evansville, it’s no secret that you’ll be met with several types of homebuyers. As long as you take the proper steps to set your home up to attract diamond hunters, you shouldn’t run into too many issues or have to deal with other less desirable buyers. Ready to make that happen? Contact our team today to see how we can get you and your home on track to make the highest return possible during your home sale.