For a real estate agent, there is no data available nor is there any mechanism to know how many sales leads are serious buyers and how many are just ‘window shoppers’. “We work on luck by chance. At times, it so happens that throughout the month we spend time with around 50 potential buyers, only to find that they were not serious buyers. I do not really know how to assess who is a serious buyer and who is not. We have to serve with equal zeal to one and all and keep our fingers crossed,” says Gautam Pant, a broker.
In many mature property markets of the world, where the broker can represent either the buyer or the seller, it is easier to differentiate between a serious buyer and a non-serious buyer. The reason is that a serious buyer comes after hiring an agent for the purpose of buying a house. This broker would shortlist the properties in that given market, negotiate on behalf of the buyer and do all the necessary paperwork. However, in India, where the same broker serves both, the buyers and the sellers, it is all the more challenging to ascertain who is a serious buyer. Most of the property seekers come through online leads, advertisement queries or walk-ins and the payment to the agent comes only when the deal is closed.
So, keep reading if you’re selling property and want to learn how to identify between serious and non-serious buyers.
How to tell whether a buyer is serious?
The question, hence, is: Can there be a mechanism to spot the serious buyers, which could save time and effort for property agents? While a direct mechanism is not possible, some understanding of consumer psychology and the home buyers’ buying behavior, could definitely indicate who is a serious home buyer and who is not. In a country like India, asking for the buyer’s financial capability could be counter-productive, as well. Moreover, most of the home buyers do not come to the housing market with a pre-approved home loan, for the seller to assess his fiscal capacity. Furthermore, many buyers may also wish to make payments in cash.
A serious home buyer, however demanding or inquisitive, is an asset for a property agent. This is the kind of the buyer that takes a longer time but does not waste the time of the agent in the final cost and benefit analysis.
10 signs to identify a serious home buyer
Asking too many questions
Dealing with a potential buyer who asks many questions, could be exhausting for the property agent. Getting into the details like ventilation in the property and for how much time one will get the sunlight in winters, might be time-consuming and taxing for the agent but is a clear indicator that the buyer has a genuine interest in the given property.
See also: How brokers can address queries about competing projects
Focus on livability
Genuine buyers are not just bothered about the given housing unit and the project but would also enquire about logistical challenges that define their livability in the property. Proximity to schools, hospitals, banks and ATMs, malls and transport connectivity might not be a property agent’s domain but this could clearly help to assess the interest level of the buyer.
Spending time at the site
A serious home buyer would definitely spend a good amount of time at the project site. It is often inconvenient for the agents, who have to serve multiple clients on that given day but it is advisable to spend an entire day with a potential buyer who has serious interest, rather than spending time with many others who may only be interested in taking a casual look at the property.
Visiting with one’s family
In India, a home purchase is, more often than not, a family decision. Serious home buyers, if not on the very first visit, generally come to the site with their families. A potential client with his/her family has far greater chances of buying the house than a visitor coming alone.
Analysis of hidden costs
A non-serious buyer may only inquire about the base selling price (BSP) and the overall amount being quoted for the given apartment. However, a serious client would get into the detailed break-up of the price quoted. He would also insist on asking whether there are any hidden charges or add-on financial liabilities with the house. He will go to the extent of calculating the monthly maintenance charges, club charges and other financial liabilities.
See also: 7 hidden costs you should not ignore when buying a house
Interior décor
Family discussions at the site, over where they could place television set or the sofa set, could indicate that the interest has reached the final level of negotiation.
Asking for value additions
Asking for additions like an air-conditioner (AC) or TV, might sound greedy on the part of the buyers. However, in today’s market, where the builders have to go the extra mile to attract home buyers, this is a positive indicator that could reflect that the deal is on the verge of closure.
Clear criteria
A genuine buyer will arrive with specific requirements in mind. Lack of clarity in requirements raises suspicion. When considering significant investments, buyers typically conduct thorough research and arrive with a well-defined set of needs. For instance, a serious buyer would know whether they require a 2BHK or a 3BHK unit. It’s unlikely for them to inquire about both options.
Financial clarity
A serious buyer possesses a clear understanding of their financial situation. They are aware of how they intend to finance the purchase and may inquire about home loan facilities available in the project. Such buyers have already addressed their home loan concerns or have a good grasp of the loan amount they qualify for.
Multiple visits
The frequency of a buyer’s visits to a property is indicative of their commitment. A lack of seriousness is reflected in a cursory visit, basic questions, and collecting brochures without further engagement. Conversely, a serious buyer typically revisits the property shortly after the initial visit, often within 15-30 days. Their turnaround time (TAT) is shorter, demonstrating their intent. Moreover, during subsequent visits, serious buyers are likely to bring along key decision-makers from their family.
Housing.com POV
Identifying serious buyers amidst numerous inquiries in the property market can be challenging for homeowners and real estate agents. While there’s no foolproof mechanism to distinguish genuine buyers from casual enquirers, understanding certain behavioural cues and patterns can help.
Serious buyers exhibit a keen interest in the property and display a thorough understanding of their requirements and financial capabilities. They ask detailed questions, focusing on aspects beyond just the property itself, such as livability factors and hidden costs. Moreover, they invest time and effort in multiple visits to the property, often accompanied by their family members, indicating their commitment.
For property agents, investing time and resources in nurturing relationships with serious buyers yields greater rewards in the long run. Despite the uncertainties in the market, serving serious buyers with dedication and professionalism remains paramount.
FAQ
How do you know a buyer is serious?
The best indicator that a home seeker intends to make a purchase, is when they have arranged for financing the property.
Does a property agent represent the buyer or seller?
In India, a property agent may represent both, the seller and the buyer and serves as a mediator between the two parties.
At what point can a buyer not pull out?
It is generally difficult for a buyer to pull out of a purchase, once the agreement has been signed.
What role does financial preparedness play in determining a buyer's seriousness?
A serious buyer is typically financially prepared to proceed with the purchase. They may have obtained pre-approval for a mortgage or demonstrate the ability to secure financing without delays. Additionally, they are willing to provide proof of funds or other financial documentation when requested by the seller.
How important is communication in gauging a buyer's seriousness?
Regular and transparent communication is key in assessing a buyer's seriousness. A committed buyer will maintain open lines of communication with the seller or their agent, promptly responding to queries and providing updates on their progress in the purchasing process.
Are there any red flags to watch out for that may indicate a buyer is not serious?
Some red flags that may indicate a buyer is not genuinely interested include making low-ball offers significantly below the property's market value, showing inconsistent communication or follow-through, or hesitating to commit to the purchase after multiple viewings or negotiations. It's essential to trust your instincts and seek advice from your real estate agent if you have concerns about a buyer's sincerity.
(The writer is CEO, Track2Realty)
Dhwani is a content management expert with over five years of professional experience. She has authored articles spanning diverse domains, including real estate, finance, business, health, taxation, education and more. Holding a Bachelor’s degree in Journalism and Mass Communication, Dhwani’s interests encompass reading and travelling. She is dedicated to staying updated on the latest real estate advancements in India.
Email: [email protected]
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