Profit from these lucky 13 sales tips
As conversations in the property world darken with talk of credit crunches, the sun's still out for property sales abroad, says Simon Palmer of myoverseasproperty.ie -- if you know how to make the most of what you've got . . .
Published 15/02/2008 | 00:00
Like the property market in Ireland some overseas housing markets are constricting and making life more difficult for sellers, whilst many others are still bouncing along in rude health and remain very competitive.
Whether selling a property in either of these markets, investors would do well to think more like a developer if they want to maximise their profit. Here are some tips to help investors obtain a smoother and quicker sale of their property:
1. Pay a higher commission
Finding out what makes your agent tick will go a long towards helping your exit strategy -- the simple answer is money. One simple, but often overlooked way, of helping your sale could be to agree to pay your agent a higher commission for the sale than he would normally get. You may think that estate agents get paid too much in the first place, but the longer your property is on the market the more it can be costing you. If giving your agent an extra 0.5 or 1 per cent means that he puts more of a focus on selling your property, then it could be money well spent.
2. Sell with a tenant in situ
Selling your property with tenants in situ would make your property particularly attractive to buy-to-let investors who like the prospect of buying with existing tenants in the property because they know the exact yield the property is getting and it greatly reduces their risk because there are no initial void periods. Your existing contract with your tenant can simply be transferred to the new owner.
3. Be competitive
Check similar properties on the market to ensure you are priced competitively. Do not look at your own property through rose-tinted glasses; if something needs changing, fix it. If viewers have been turning their nose up at your property, ensure your agent briefs you on the reasons people didn't like it so you can address these issues quickly.
4. Undercut your rivals
Remember, you will never go broke taking a profit -- so don't be too greedy. If you can make a decent profit then take it, because you don't know what is around the corner. So try undercutting rival properties to help ensure a quicker sale. While you may get a lower overall price, that fact that you may have a smaller void period could even things out. Remember to look at your property portfolio as a whole; if property in a different location is 'washing-its-face' then use some of the excess to cover an reduction on a property elsewhere.
5. Sell as a portfolio
If you have other overseas properties, considering grouping them together and selling as a ready-made hands-off portfolio. Agents regularly do this to provide investors with a simple solution to building a portfolio. Investors sometimes prefer this because it provides them with economies of scale in terms of the time costs of sourcing the properties individually, but beware, they could be looking for economies of scale in the price too.
6. Give a guaranteed rental period
To encourage a buy-to-let investor to take on the property, try guaranteeing the rent for an introductory period, say, two months, so that any purchaser does not have to worry about the possibility of a void period. Agree a rent which would be enough to cover the gross costs of the property -- an offer of two or three thousand euros up-front could go a long way towards sealing the sale.
7. Pay the mortgage . . .
This is similar to point three but directed towards an owner-occupier who may look favourably on not having to pay his mortgage for a couple of months. This is similar to the cash-back offers that developers provide to new buyers. First-time buyers would be particular favourable to this because it means they can spend their first couple of months buying furniture instead of paying the mortgage.
8 . . . or the stamp duty
This is another common ploy used by developers to entice buyers that can be used to make your property more attractive. Even if the cost of the stamp duty is simply factored into the price of the property, buyers could still find this attractive because instead of paying the stamp duty up-front because the cost will be spread over the length of the mortgage.
9. Make your fit-out special
People often make the mistake of paying a premium for a property and then going with a standard fit-out, when paying more for a fit-out would ensure that your property stands out from the competition thus ensuring it is more in demand. Often, simple additions such as a flat screen TV or Jacuzzi bath can make a lot of difference for a reasonable cost. Also, stick with neutral colours that appeal to a wide range of people and don't fit-out in your own tastes because that red wallpaper you love may not appeal to your potential buyers.
10. Buy a parking space
If you don't have one already then buy a car parking space in order to make your property more attractive, particularly if it is located in a city centre. Finding car parking is notoriously difficult in city centres and can be terribly expensive. The success of the London congestion charge zone means that other cities are looking at taking on similar initiatives, and as this noose tightens around car users, the addition of a car parking space can greatly increase the demand for a property, both from renters and end- purchasers.
11. Take notice of your agent
Always take on board what your agents tell you; they know what sells and doesn't in the local market more than you do, even if it is your local market. They are on your side because you both want to sell the property, so don't be blinkered when they say something needs changing.
12. Appoint dual agents
Getting another agent on the property can often make the incumbent raise its game. This is common practice on commercial developments, but try to ensure a winner- takes-all-fee instead of splitting the commission to ensure you have two agents competing against each other for the full commission.
13. Change agents
Finally, don't be afraid to change agents, and don't waste time with them if they are not delivering. Often just telling them you are going to drop them can deliver instant results.