As a full-time Realtor in Scottsdale, I get asked this question several times a day. Unlike many agents in the Valley, I typically ask the seller, “Tell me more about the house.”
The reason for this is based on my observation that if the “pool of buyers” was like a pizza, 6 out of 8 slices (3/4’s of all retail buyers) cannot afford a “renovation project” from either a time or money standpoint. In other words, most interested home buyers either have just enough money for the down payment and closing costs or they simply don’t have the heart (or the stomach) for a long-enduring remodeling job or make-over project to sell their home. Depending on the area in which you live, you may be in the midst of dichotomy market which offers opportunities to both buyers and sellers.
This situation of having multiple buyer/seller persona in the marketplace creates a dichotomy that breaks down like this:
Turn-Key Home Buyers
The majority of buyers fall into this category. They need a “turn-key” home that’s been updated and is priced such that it will appraise for enough to satisfy their loan request. Buyer’s should be prepared to negotiate as the features of a desirable turn-key home will drive up the price.
These buyers are the remaining two slices of pizza and are willing to take on a project for a potential trade off in price. However, this group gets split up in two as not all of these buyers are investing in home renovations to live there. ½ are looking to get a profit off the sale. These are more commonly known as “house flippers”. House flippers take advantage of the low cost of a home to make a profit off of it themselves by completing renovations and selling it in an up market. The other 1/2 of this group is an end-user who wants a discount on a home, sees the potential and has plans to live there. These are the “fixer-uppers”.
Seller’s Benefit in a Dichotomy Market
Sellers need to realize that how their property fits into this delicious pizza mix and which kind of buyer is most likely to buy their home, depends completely on the overall fit, feel and finish of the house. If a house is full of bright brass hardware/fixtures and still sporting that raspberry swirl cultured marble surfaces with mauve carpeting throughout, you’re in trouble! Get ready to sit on the market forever or deeply discount the price to sell to a fixer-upper buyer.
A better strategy would be to hire a recommended local contractor to help you update the kitchen/appliances, bathrooms and outdoor living spaces to improve the property so you’re more likely to sell to turn-key home buyers, where it’s not uncommon to see multiple or close to full price offers in the first week or month of the listing, depending on the price range, etc.
If you are thinking about selling your home soon, please do yourself a favor and ask your Realty One Group agent to come by and walk-through the property with you to determine what can be done to appeal to the bigger pool of turn-key home buyers. There are many factors to understanding if you are in a dichotomy market such as understanding the area, average number of days on market for sold houses, and average purchase price. Talk to a RealtyONEGroup agent when selling your home so you can win at ONE!