How to identify your target buyer segment before selling property?

Selling a property can be a profitable way to generate funds for a new investment or another property purchase. Every property seller should ensure they have a well-planned strategy in place to get the most favourable deal. One of the aspects is identifying a buyer segment, which will help the seller create the right targeted marketing strategy, get high-quality leads and close the deal faster. Merely listing out a property without any idea of the buyer category can delay the home-selling process. In this guide, we help property sellers in identifying the target buyer segment before listing a property.

How does identifying target buyer segment help property sellers?

Attract relevant buyers

Identifying the target buyer segment enables sellers to tailor their marketing efforts for that specific group. This can be done by mentioning specific features in the property listing that appeal the most to such buyers. Personalising the messages helps develop trust among potential buyers, increasing the chances of profitable deals.

Saves time

Property sellers save a lot of time and get a faster closure if they know the buyer segment they want to cater to and with the right marketing plan in place. The result will be better quality leads. On the other hand, a one-size-fits-all approach can make them lose focus on irrelevant buyers.

Get better ROI

Designing the right marketing strategy for a specific buyer category is more likely to attract high-potential buyers, resulting in genuine leads. More importantly, it helps the property listing stand out from other competitors. Ultimately, the seller is likely to achieve a higher return on investment (ROI).

Property buyer segments based on market trends

Age group

In the Indian real estate market, property buyers can be broadly categorised based on demographics and age groups: 

• Millennials: Millennials, who are individuals aged between 29 and 44 years, form the largest aspirational group of homebuyers in India. This segment is characterised by a high preference for a modern lifestyle and being digitally savvy.
• Gen Zs: This buyer group includes young adults aged between 18 and 28 years, who are slowly entering the market. Such individuals are known to be well-organised when it comes to financial planning and prioritising home ownership.
• Gen X buyers: This group of buyers includes individuals from the earlier generations, aged between 45 and 60 years. The demand from this buyer segment is mostly tilted towards purchasing second homes and planning for the future. 
• Senior citizens: This group includes individuals above 60 years of age who show a high preference for senior living and retirement homes. 

Intent of purchase

Based on the purpose of buying a property, buyers can also be classified into the following:

• End-users: This category includes buyers, such as families, who purchase property for personal use and typically reside in it.
• NRIs: The Indian real estate market witnesses a significant demand for NRI property buyers, driven by the need to generate additional income and to secure their future. 
• Property investors: This category of buyers, which differs from end-users, mainly includes individuals seeking new investment avenues to diversify their portfolios, generate high returns on investment (ROI), and build wealth. 

Buying behaviours

Property buyers can also be classified based on their buying behaviours

• First-time homebuyers: This class of buyers primarily includes younger individuals or families purchasing a property for the first time. Hence, the focus for these buyers is mainly affordability and proximity to key facilities.
• Luxury category: The demand from these buyers is mainly driven by the need for a high-end lifestyle, luxury features and premium location.

How to identify your target buyer segment?

#1. Assess the property

The first and foremost step to identify the target buyer segment is assessing the property. Check the type of property – apartment, independent house, villa or plot. Assess the location, whether the property is in the city centre or the suburbs. Ask key questions – are there schools and other facilities nearby? Is there good connectivity? Home sellers must figure out if there is demand in their location for the type of property they own. The next step is to take this data and assess the category where the majority of such buyers belong. For instance, if you have a 3BHK villa in the far-flung city outskirts situated in a gated community, the demand is likely to come from young buyers looking for an aspirational lifestyle or older individuals looking for a retirement home. Such properties would not be suitable for working professionals who may be looking for homes closer to city centres or areas with good connectivity.

#2. Study the market trends and buyer behaviour

Assessing the market trends can help property sellers gain insights into buyer behaviours and preferences. This exercise involves identifying buyer demographics – the age group of prospective property buyers, their income level, etc. Analysing buyer behaviour can also help identify target buyers based on their financial potential and investment preferences. Other examples of buyer behaviour could include a growing desire for a modern lifestyle with access to new-age amenities, such as smart home features. There may be eco-conscious buyers looking for sustainable living. Therefore, understanding buyer demand in a location can help property sellers make small upgrades to their property and customise their listing, catering to their target buyers.  

During the market study, property sellers can list out the buyer groups and assess their preferences to see which group matches the most with your property. Some examples of these buyer groups include:

• End-users such as families or retirees
• Students or single working professionals
• Investors or NRIs looking for second homes

Researching the local property trends will also provide useful inputs on the current supply-demand dynamics – whether there has been an increase in student population due to an upcoming educational institution in the neighbourhood.

#3. Align property listing with buyer expectations

List out your property’s unique selling points (USPs) in the property listing to attract the right buyer group. For instance, it can be the location – close to an airport, metro station, a business hub, etc. Such a property is mostly preferred by working professionals who are likely to travel frequently. 

The USP could be the size and layout. A four BHK house is likely preferred by large families or property investors looking to earn rental income. On the other hand, a one-bedroom flat is likely preferred by students or single people relocating to a new city. Similarly, retired individuals may look for properties away from the busy roads and closer to calmer places and with access to healthcare facilities. 

Understanding these buyer expectations can help sellers align their property listings suitably to capture their targeted buyers’ attention.

#4. Set the marketing and pricing strategy 

After identifying the target buyer segment, setting a property’s pricing strategy becomes easy for sellers. Different buyer segments have distinct housing needs and financial capabilities. First-time buyers mostly seek affordable homes with easy financing options. Setting a price above the market value can make sense in case of a luxury home. For investors, the pricing focuses on potential rental income or long-term appreciation the property is likely to generate. Such an assessment helps property owners decide their pricing effectively. 

Similarly, it is crucial to choose the appropriate marketing channels to reach out a wide range of potential buyers. Young buyers, including millennials and GenZ, are active on social media. So, interesting social media ads or partnering with agencies online can help expand your reach. Personalised marketing messages can instantly create an impression on your target audience. 

Property sellers should leverage the data gathered through such analysis to customise their marketing efforts. There may be a need to refine one’s marketing and communication depending on the buyers’ response. Analysing buyer needs helps sellers modify their strategy, which also helps ease the negotiation process and lead to faster transactions.

Housing.com News Viewpoint

If you are planning to sell your house, make sure you have identified the right buyer group, which will ensure a profitable deal. When promoting your property online, highlight the key features that match with the buyers’ expectations. Property sellers should never underestimate the need for thorough market research, which will give them key insights into changing buyer behaviours. For first-timers, it could be challenging. Approaching an experienced real estate broker can be helpful.

FAQs