Understanding How To Maximize Your Buyer Pool
In real estate, whether it be for your personal homestead, or some type of investment property, (which in reality, every real estate purchase is an investment), the overall goal is to be able to make a profit by selling your property for more than you paid for it, plus expenses. So the first step in being able to accomplish this goal is to understand what factors will make a property appreciate more in a particular market.
The biggest key to being able to find a property that is going to have the greatest probability of maximizing appreciation is finding a property that is going to appeal to the largest pool of buyers, as possible. In other words, we want to own a property that the majority of buyers in that price range would find attractive enough to buy. The more buyers that you have interested in the property, the more that they will need to compete against each other in order to win the house that they desire, which drives the price up and speeds up the timing it takes to sell the property.
Custom homes aren’t always better!
Building or buying a custom home can be really great for being able to get exactly what you want in a home, or to be able to have certain elements in your home that tract builders just won’t do. However, sometimes these custom homes are built so much to the exact needs of the homeowner that is designing/building the home, that they don’t think about the resalability of the home and if the mass population would like the custom elements to the home that they built, or if they would find them dysfunctional and unappealing. In other words, if they did not build the home with the idea of maximizing their buyer pool, then it will result in their property not appreciating at the same rate as other surrounding properties that do not have the same functional obsolescence.
The best way to find out and understand what factors in a particular market would cause your property to NOT appreciate to its full potential, would be to consult with a local real estate expert with a deep understanding of the market, or to study the comparable properties in that market to see which homes are selling quicker and for more money, versus the ones that don’t, and to see what commonalities each group of properties has with each other. Once you start seeing a pattern of how a certain element of the property is affecting the price and demand for a property, you will be able to start understanding the factors that affect resalability and appreciation for that market. The more desirable factors to the mass market that a property has, the higher the ceiling is for appreciation on your investment property.
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