Market Segmentation
Definition of "Market segmentation"
The term market segmentation is mostly used in marketing for assembling prospective buyers in groups based on their needs and their response to a marketing action. One definition of market segmentation is the market’s division into subsets of customers to simplify targeted branding and marketing strategies. When you know who you are trying to attract, you know what they are interested in, it’s easier to approach them.
What is Market Segmentation in Real Estate?
Real estate market segmentation allows real estate companies, investors, and brokers to target specific groups of buyers who would get the biggest benefit from a type of property. The purpose of market segmentation in real estate is to identify and target specific groups of buyers to offer them real estate that was tailored or branded precisely for their needs.
Market segmentation for real estate can be done based on different factors like the type of property (residential or commercial), demographics (millennials or baby boomers), geographical location (one city or state versus another). Based on the type of market segmentation applied and the reason for which it was applied, it can be used in different ways.
Examples of Real Estate Market Segmentation
Real estate agents use market segmentation to find their niche based on the types of buyers or sellers. They can also use it to improve their business depending on the client they work with, the buyer or the seller. Applying market segmentation to their strategy helps them improve their brand and communication towards their targeted audience.
Investors and real estate developers look at market segmentation to evaluate performances. For instance, during economic strife, some segments of the market might be more profitable than others. The commercial real estate market might not be as affected by an economic downturn as the residential market. Similarly, the rental market might drop while the homeowners market skyrockets. In some cities, single-family homes might be more profitable than high-rise apartment complexes or vice versa. Being able to determine this through market segmentation helps investors and developers supply a growing demand while also increasing their revenue.
Popular Real Estate Terms
Platform erected on a roof in some New England homes having a view of the sea. It was said widows of lost seaman would walk on the platform looking out at sea for their husbands to return ...
Estimated market price property could bring using currently accepted appraisal methods. This might not be the same as the market price at any one given time when the seller is compelled to ...
A loan in which the entire charge is subtracted up front from the face value of a loan. The proceeds received are the face value of the loan less this deduction, which increases the ...
Penalty charge in order to cure a previous wrong. ...
Imagine someone asking you about the definition of the real estate market. At first sight, it may seem like an easy answer. But wait! Could the real estate market meaning be more complex ...
Fluctuation in sales, profits, rat of return, etc. Likelihood of declining value. ...
Geographic area that is attractive to prospective tenants. Square footage in an office building or apartment house that may be rented by a tenant. ...
Same as term plat: Map that shows the location and boundaries of individual properties. ...
Also called a teaser. The starting interest rate of an adjustable rate loan. It generally lasts between 1 and 12 months, at which time the loan rate increases based on prearranged criteria. ...
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