Every buyer has their own individual circumstances, motivations, budget and criteria for investing in real estate, requiring a unique and customised approach for each buyer.
Despite these differences however, many share the same views when it comes to how they search for properties, how and when they choose to engage real estate agents, and their preferred method of sale.
Click the video below to discover what really goes on inside the minds of real estate buyers.
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1. Melbourne, Australia
2. Vienna, Austria
3. Vancouver, Canada
4. Toronto, Canada
5. (Tie) Calgary, Canada
5. (Tie) Adelaide, Australia
7. Perth, Australia
8. Auckland, New Zealand
9. Helsinki, Finland
10. Hamburg, Germany
Welcome to Pennisi’s ‘How to’ series. This issue explores the 4 key steps you must follow for a successful property sale. You may be new to the property market and this may be the first property you have sold, or you may be an experienced property seller and just need reassurance that you are on the right path. This guide steps you through the 4 stage process for effectively selling your property to get the maximum possible sale price.
1. Choose the right agent
Selling your property is an important life event which can be financially and emotionally demanding, and that’s why you need an experienced and trusted professional real estate agent to help you with the process. Find an agent you trust, who you believe will look after your interests and do a great job. Interview as many as it takes to find one you trust. Beware of agents who try to dazzle you with empty promises of an unrealistic price, or an expensive marketing campaign that promotes their agency but does little to sell your property.
Checklist – Key qualities of an ideal real estate agent:
- A trusted reputation in the community
- Great testimonials from past clients
- A proven record of great sales results in your area
- Knowledge of the market and what pricing strategy will work for you
- Exceptional communication and negotiation skills
- A demonstrated understanding of your needs
- A list of buyers ready to buy now
- Written service and price guarantee, over and above the standard industry Agreement
- A fair fee. Cut-price agents will usually cut-price your house. Choose the agent that will get you the best price net of fees
The method of sale you choose for your property can influence the sale price. Popular property sale methods are:
- Private treaty: Sellers’ real estate agent negotiates with interested parties. It takes a skilled negotiator to extract the best possible outcome for the seller.
- Public Auction: A public sale held at a specific place, time and date after a marketing campaign lasting several weeks.
- Silent auction: buyers make their offers in private, as a sealed bid.
Your professional real estate agent should have a recommended sale approach based on previous experience in the area to maximise your sales price.
3. Set the pricing strategy
Once you have selected the agent and selling method that is right for you, the next step is to establish your pricing strategy. A good agent has ready buyers. Early offers from these buyers are often the best offers. Be ready for this by deciding, before marketing your property, your idea of a great price and an acceptable price.
Consider a price range based on your expectations, market conditions and previous sales in your neighbourhood. Your agent should be able to guide you and provide insights into recent sales in your local area. Start at the high end of your range – someone may love your property – but be prepared to adjust the price quickly if offers are not forthcoming. Your price must generate interest online and in your agency’s database. A good agent will guide you.
4. Property Presentation
Potential buyers will be viewing your property and trying to imagine themselves making a home there. A tidy garden, clean windows, polished floors and de-cluttered rooms can significantly add to the appeal of a property. First impressions matter. Showcase your property’s unique features with prospective buyers in mind, to maximise the potential value of your property and sales price.
Maximise the sale price of your property with this quick checklist:
- Are you researching local agents to choose the right fit for you?
- Does your agent have local knowledge and expertise?
- Are they trained in negotiation?
- Have they demonstrated integrity and trustworthiness?
- Have you considered the different sales methods?
- Have you decided on your ideal sales price?
- Have you prepared the interior and exterior of your property to present it in the best possible light for potential buyers?
Still have questions? Why not talk to one of our agents?
With more than 44 years experience in real estate, we know that selling your property can be a challenge. We invite you to meet with us, to see if we can help you sell your property for more. Call 03 9379 5616 now to make a time.
Buying your first home can be daunting – both financially and emotionally. It’s likely to be one of the biggest investments you’ll make, so the team at Pennisi Real Estate have compiled their top 5 tips to guide you.1. Start saving now
House deposits can take a while to save, so it’s smart to start saving as soon as you can. Save the biggest deposit that you can. This not only demonstrates to your lender that you can exercise enough discipline to accumulate a large amount of savings, but you will also have a buffer of equity in the property from the beginning.
2. Buy below your maximum price
Your bank may suggest yoqu can borrow up to $400,000 in your initial meeting, but it’s much safer to search for a home that is well below your maximum price. Buy a property that you can afford now so that you don’t overstretch yourself. Many people count on a future job promotion to help keep them afloat – but what if that promotion doesn’t come?
3. Allow for extra costs
There are extra costs associated with buying property. Not only is there stamp duty, solicitor’s fees and inspection reports to consider, but if you choose to borrow over 80% of the property’s value you’ll be faced with lenders mortgage insurance (LMI). LMI isn’t actually for you – it’s for the lender, but you’re the one that has to pay it. These pesky extras can quickly add up and be a burden if you haven’t accounted for them. Don’t forget, interest rates are at historic lows, so be prudent and allow for at least a couple of percent increase over the next few years.
4. Choose between ‘wants’ and ‘needs’
It’s very easy to confuse your ‘wants’ with your ‘needs’, but it’s important to distinguish the two when buying. Do you really need that brand new four-bedroom house in an inner-city suburb or is it something you want? Take a good look at your salary, debt levels, costs of living and what the repayments would be like for your dream property. Can you afford it? If not, it’s time to prioritise what features are the most important in your new home. Your first home won’t be your last, so it’s ok to compromise!
5. Take advantage of government concessions
When you’re purchasing your first home, every dollar can help. If you live in Queensland, you can take advantage of the Great Start Grant, which offers up to $20,000 towards purchasing or building a new dwelling. Also, make sure you apply all the concessions on stamp duty.
1. Not doing your research
When purchasing an investment property, it’s important to do your research about the location, local amenities, rental yields, vacancy rates and the property itself. While it may not always be possible, you should aim to know as much as you can about the neighbourhood you intend to invest in. Be wary of ‘booming markets’ such as mining towns and tourism centres. These may produce excellent returns over the short term, but how will the investment stack up long term if there is an industry downturn? Remember, a good investment is not one based on speculation.
2. Not having a professional property management team in place
Many people assume property management is simple and think they can do it all when it comes to taking care of every aspect when managing their property. This can quickly become a stressful and tedious task, not to mention the ever increasing legislative requirements that fall upon landlords – it might even start to feel like another job! A professional property management team can take care of everything, from advertising the property, screening potential tenants, filling the vacancy quickly, conducting regular inspections and answering tenant requests for maintenance and repairs, amongst other services. A good property management team will give you peace of mind and keep everything running smoothly – if that isn’t the case, find yourself a new property manager. Too many investors make the mistake of keeping a poor property management team on for far longer than they should have.
3. Forgetting about tax benefits
Andrew Pennisi says “the golden rule is that you always invest of the strength of the investment alone – any tax benefits that go with it should be regarded as icing on the cake”. However, you should be very aware of what you can claim come tax time. By not taking advantage of tax deductions, you could miss out on hundreds or even thousands of dollars in potential returns. Ensure you have tax depreciation done - even with existing properties there are claims to be made. Another benefit of having a property management team in place is that they record all expenses and outgoings for your tax purposes.
4. Know your numbers
As with any property purchase, the figures can quickly start to add up. While you need to factor in normal costs associated with buying such as stamp duty, conveyancing, council rates and building and pest inspections, it’s vital to also account for all the extras that come with property investment. This includes but is not limited to maintenance and refurbishment costs, landlord protection insurance, home insurance and body corporate fees if applicable. Older properties will generally require some immediate maintenance, as things always seem to go wrong in the first few months, so allow for the cost of a few repairs when considering your budget. Ensure you allow for two weeks of vacancy per year. If you price your property to the market, it won’t stay vacant for an extended period of time. Have a financial contingency plan in place in case rental returns drop or you need to sell. It’s always smart to underestimate your incoming funds and overestimate your outgoing expenses to avoid an unpleasant surprise when the accounts are finalised each year.
5. Focus on the long-term
Some people treat property investment as a ‘get rich quick scheme’, however this is rarely the case. Generally speaking, the longer you hold onto a property, the better your chance at reaping a greater profit. If you’re planning on values rising in a few short years so that you can sell your property at a large profit, you are speculating rather than investing and may be sorely disappointed come sale time.
If you feel at risk of making any of these investing mistakes, get in touch with our team and we'll walk you through how to make the most of the investment opportunities available to you.