How do traditional buyers and house investors differ?
The term buyer is used to broadly describe people who buy homes, but buyers can come in varying forms — traditional buyers, traditional investors and iBuyers. The type of buyer you accept an offer from can impact the rest of the transaction process.
Who are traditional home buyers?
Traditional buyers are people like you, when you bought your current home. They’re looking to purchase a property to reside in, either as their primary home or as a vacation home.
A traditional buyer will make an offer based on their perception of your home and their research on its market value. There’s also an emotional component to the purchase. Maybe your home has a unique quality they’ve been looking for, like a big yard for their kids or the perfect layout for their needs. Traditional buyers may pay more than market value for the features they crave, or they may be willing to pay above asking price in a multiple-offer scenario.
According to the Zillow Group Consumer Housing Trends Report 2022, these attributes comprise today’s average traditional home buyer:
41 years old
College-educated couple
Middle-class income
Looking for a single-family home
Who are home investors?
A professional home investor is either an individual or a company that buys residential properties as part of a business or investment strategy. Individual investors may own just one or two investment homes (that they either keep and rent out or flip and quickly resell), but companies that buy houses usually do so in bulk. Home buyer investors usually employ one of four key strategies.
BUY-AND-HOLD INVESTMENT
A buy-and-hold investment strategy helps an investor grow a real estate portfolio over time. An individual might use this strategy to buy a home to rent for side income. They use something called a cap rate to determine their yearly expenses versus their potential profit and see if an individual investment pencils out before buying. A larger corporate investor may buy a home without renting it if they’re simply trying to grow their portfolio or want to wait for improved market conditions.
WHOLESALE INVESTMENT
Investors who buy properties and then resell them very quickly (and without making any improvements) are using a strategy called wholesale investment. They buy homes at well below market value, with the goal of selling to another investor for a higher price. Successful wholesalers usually have a large list of buyers lined up beforehand and use direct marketing to identify inactive or off-market homes they can buy inexpensively.
HOUSE-FLIP INVESTMENT
Individuals or companies who buy houses, renovate them, and then sell them at a higher price are called home flippers. While the level of renovation needed and completed varies by the individual home and the local market, the goal is to make a profit on the resale, even after clearing all renovation expenses.
BUY/FLIP/HOLD INVESTMENT
This type of investment is a hybrid of some of the other strategies covered above. In this case, individuals or companies buy a property, renovate it (in either minor or major ways), and then rent it out at a premium, while maintaining ownership.
Who are iBuyers?
Like other professional home investor companies, an iBuyer is a house-buying service (not an individual). What makes an iBuyer different is that they use technology to streamline the selling process, which can mean less hassle for you as the seller. iBuyers rely on a wealth of data and comparable home sales to make offers, often sight unseen.
We here at CT Cash Homes are different than any other buyers. After you contact us and give us the property information, we will make you a fair, all-cash offer within 48-hours, and that is not even the best part. We never tell you when to close. YOU get to choose. If you are looking to close quickly, we can wrap up the deal and get you the cash in as little as 7 days. To get started, you just need to give us a bit of information about your house and the situation that you are in. To contact us, simply fill out the form on this page, or give us a call at (860) 249-0950 for a faster response. It is our goal to make your life easier by getting you out from under the property that is causing you problems and stressing you out. We can do this by paying a fair and honest price for your house quickly. So the next time you're searching google for real estate investor ct, real estate investor near me or sell my house fast, click on CT Cash Homes.