How Does a Real Estate Agent Know if a Buyer is Serious?

September 27, 2021

As a listing broker in Western Colorado, it is my fiduciary duty to bring my sellers competent and capable buyers.

You've hired a real estate broker and listed your property for sale. Now, you need to find a serious buyer. Plenty of curious house hunters might want to dip their toes in your listing. If they're not serious about purchasing the property, you and your real estate broker will waste valuable time tending to their needs and miss opportunities to find interested buyers instead.

Let's use one of my current listings to illustrate this scenario - a log home on 44 acres of irrigated land in Western Colorado. Joe Smith drives past the listing on his way home from work and calls me, the listing broker, to set up a showing. At this point, I have no idea if Joe is prepared to buy, has money for a downpayment, or has been pre-approved for a loan. If I set up a showing, I would be doing so without answering critical questions like:

  • Can Joe Smith afford a $1.1million property? What if he can only get approved for a $500,000 loan?

  • What if Joe Smith needs five bedrooms for his family? This log home only has four.

  • Does Joe Smith need infrastructure that this home cannot provide? Examples of infrastructure include high-speed Internet access, proximity to amenities, solar power capabilities, etc. 

  • The list goes on and on.

It is a listing broker’s fiduciary duty as an agent to bring my sellers competent and capable buyers. Vetting buyers before scheduling a showing is the only way to ensure this. 

Is a Buyer Shopping Above Budget?

A serious buyer should either be or be in the process of getting pre-approved for a loan. One of the easiest ways to determine if a buyer is shopping above their budget is simply to ask. 

In my experience as a listing broker in Western Colorado, most capable buyers have no problem providing financial capabilities. If a buyer is insulted by being asked to prove their capability to afford the property, they are most likely shopping above their budget. Since buyers have to get pre-approved and pre-qualified for a loan anyway, they shouldn't have a problem sharing that information with you.

Is a Buyer Ready to Buy?

Another non-serious buyer archetype is a buyer that is not necessarily ready to buy but only interested in seeing what's on the market. Of course, curiosity is usually the first step of any buyer's journey, but curious buyers probably aren't ready to pull the trigger.

If someone is not ready to buy, they should familiarize themselves with the area and the amenities before looking at specific properties. Chances are, those properties won't be on the market when they are ready to buy anyway.

Questions to Ask Potential Buyers

Showings disrupt multiple people, including yourself, so take the time to vet your buyers. If you pick up the phone and someone says they want to schedule a showing, you should:

  • Get a sense of the buyer's needs (number of bedrooms, number of bathrooms, etc.)

  • Get a handle on the price range the buyer is capable of purchasing

  • Ask if they have been pre-approved or pre-qualified for a loan

  • Send them an MLS listing of homes that currently qualify

  • Eliminate homes on paper before going to take a look in person

Showings Don't Automatically Translate to Offers

Showings are a necessary part of the selling process, but be wary if you're getting an outrageous number of showing requests for an expensive, luxury, or niche property. If you don't vet your buyers, you could end up spending all your time showing a listing - and none of your time on marketing that property to the right audience!