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SELLING YOUR HOME – No.5: SETTING YOUR ASKING PRICE

Today we publish the next of our blogs in our 12-week blog series, THE ULTIMATE GUIDE TO SELLING YOUR HOME.

CLICK BELOW should you prefer to skip this 12-week educational and proceed straight to a FREE EMAILING of the entire document:

 

 

 

 

 

#6, 7 & 8: SETTING YOUR ASKING PRICE & BEING AWARE OF ALL COSTS WHEN SELLING YOUR HOME

We have already warned against becoming emotionally involved when selling your home, as this is what often results in properties coming to the market at an unrealistic asking price.

But there are other factors which will also determine whether prospective buyers see your property as fairly priced:

  • ask yourself from the outset whether you “want to sell” or “need to sell”. If you find yourself in the former situation, you could lean towards the higher end of the valuation scale. However, if you are in the latter situation, you need to price your property at the bottom of the valuation scale
  • a buyer only has a certain amount of funds available, or only has access to a specific amount of bond finance. This has to be used to secure the most appropriate property possible for his or her particular needs. Couple this to the advances in technology, which permit the buyer to research every possible property in the desired location. It becomes critical for sellers to be realistic about the price they set for their home
  • obtain an understanding of what current market conditions are, i.e. is it currently a sellers’, buyers’ or a neutral market. A sellers’ market means that demand for property is strong and you could price your property slightly higher. A buyers’ market means that properties are not fetching the prices it has in the past. This could be the result of recent property prices having just become too expensive or as a result of the prevailing economic conditions.          

PRICE YOUR HOME ACCURATELY

In the preceding section, we highlighted the advantages agents have in the process of valuing your property. This includes the benefit of agencies having access to digital platforms such as CMA (Comparative Market Analysis) to:

  • extract the selling prices of comparable properties sold in your area over an extended period
  • provide you with a projected valuation, based on your initial purchase price and compounded interest rates, over the ownership period
  • establish how many properties had been sold in your area for different periods, providing you with a view of prevailing market conditions
  • extract municipal valuations of your property and those in your surrounds.

 

An agent who uses this tool effectively, will be able to provide you with an accurate valuation of your property based on factual and extensive statistics.

BE AWARE OF CERTAIN COSTS YOU WILL HAVE TO INCUR DURING THE PROCESS

Sellers are often caught unawares by costs which they have to incur by law. These include:

  • Electricity compliance
  • Beetle certificate
  • Plumbing compliance
  • Gas certificate

Any non-compliance identified during the inspection will, in turn, translate into specific repair or upgrading costs to the seller.

These compliance inspections mostly occur during the conveyancing process. However, the seller may take it upon him or herself to have the inspections done prior to the marketing of the property. This will mean that you can present a prospective buyer with compliance certificates, reflecting your property’s “clean bill of health”.

A note of caution, though, when embarking on the compliance process. You may find there are a few service providers who may quote you on items which not necessarily require repair or upgrading for your property to be considered compliant. Therefore, be sure to use your agent’s knowledge and experience to access reputable and trustworthy service providers.

NEXT WEEK: SIGNING A MANDATE

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Blog Education

SELLING YOUR HOME – No.4: ASK ABOUT THE AGENT’S COMMISSIONS

Today we publish the next of our blogs in our 12-week blog series, THE ULTIMATE GUIDE TO SELLING YOUR HOME.

CLICK BELOW should you prefer to skip this 12-week educational and proceed straight to a FREE EMAILING of the entire document:

 

 

 

 

 

#5: ASK ABOUT YOUR AGENT’S REAL ESTATE COMMISSION WHEN SELLING YOUR HOME

You have made sure that you understand exactly what service you can expect from an estate agent. You now need to ask the agent about the sales commission you are eventually going to be charged. Once you select your agent, you will be asked to sign a sole mandate with the agency. Long before that happens, you want to have the sales commission issue resolved.

On the one hand, the commissions charged by estate agencies often seem out of sync with the service you may receive. This may not necessarily be as a result of poor or inadequate service on the agent’s part. You have, after all, carefully pre-selected the agent based on the thorough process described earlier. However, sometimes properties sell relatively quickly. The time, effort and cost expended by the agent during the marketing process often does not match a very large sales commission.

What is more, sales commissions have historically been calculated as a percentage of the eventual selling price of a property. It means that a R 5,000,000 property will incur a lot more sales commission than a R 2,000,000 property. You may think that this is equitable, as a more expensive property requires more time, effort and cost to market. However, this is simply not the case.

Statistics show that there is a massive discrepancy in this price/commission relationship. After all, the ratio of the cost, effort and time is most certainly not 5:2 (R 5,000,000 vs R2,000,000).

The times, they are a changing

That is the reason for the current revolution in the real estate industry. Estate agencies such as our’s provide a more equitable solution by charging a flat fee for any property transaction. And, contrary to the pervading opinion of the ‘traditionalists’, that flat fee still gets the home seller the full, personal real estate service. We just do it more efficiently through the use of effective systems and infrastructure and then pass the saving on to the seller.

So, it is critical that you negotiate the sales commission with the agent prior to signing the mandate. It should certainly not be the traditional 7.5%, those days are long gone. And it should preferably be a flat fee, unrelated to the price eventually fetched by your home.

NEXT WEEK: DON’T SET AN UNREALISTIC PRICE FOR YOUR HOME

Categories
Blog Education

SELLING YOUR HOME – No.3: ASK ABOUT THE AGENT’S SERVICE OFFERING

Today we publish the next of our blogs in our 12-week blog series, THE ULTIMATE GUIDE TO SELLING YOUR HOME.

CLICK BELOW should you prefer to skip this 12-week educational and proceed straight to a FREE EMAILING of the entire document:

 

 

 

 

 

#4: ASK ABOUT THE EXACT SERVICE YOU WILL BE RECEIVING FROM YOUR AGENT WHEN SELLING YOUR HOME

So, you have made appointments with several estate agents to visit your home. You have met them personally and have obtained a valuation of your property from each of them. It is now the time to ensure that each one of them will be marketing your home effectively.

 

 

So, ask each agent:

  • how long the person has been an estate agent
  • how long he or she has lived in your area
  • what he or she thinks of your property and the area it is located in
  • ask the estate agent about both the positives and the negatives of your property
  • find out what advice he or she has for you to improve on the negatives, i.e. basic cosmetic changes and de-cluttering or more major upgrading
  • how he or she envisages presenting the positives of your property effectively in the marketing process
  • what technology he or she will be using in presenting your property effectively (photography, videography and/or drone technology)?
  • about the marketing mediums and sites he or she will be using to market your property (newspaper, magazines, website, social media, external property listing sites)
  • whether the agent may not already have some buyers who may be interested in your property
  • about the viewing of your property by potential buyers. It is critical to ask whether the viewing will be facilitated by the property agent in person? What time of day are such viewings likely to take place? How long does such a viewing typically take? What notice period you are likely to be given for a viewing?
  • whether the agent will handle all the price and other negotiations between you and the potential buyer and
  • will the estate agent assist you in the execution of any suspensive conditions which may be attached to the sale, the arrangement of electrical and other inspections and the actual conveyancing process.

Finally, you must ask the Agent for references and/or testimonials from past Clients.

NEXT WEEK: ASK ABOUT YOUR AGENT’S REAL ESTATE COMMISSION

Categories
Blog Education

SELLING YOUR HOME – No.2: PLAY THE ESTATE AGENT FIELD

Today we publish the next of our blogs in our 12-week blog series, THE ULTIMATE GUIDE TO SELLING YOUR HOME.

CLICK BELOW should you prefer to skip this 12-week educational and proceed straight to a FREE EMAILING of the entire document:

 

 

 

 

 

#3: PLAY THE ESTATE AGENT FIELD

You now understand what you can expect from an Estate Agent and you need to decide on who to appoint to market and sell your home. Don’t just pick the first one you see on a board somewhere. Even worse, don’t phone someone who has been a dear friend for many years and just happens to have become an intern estate agent two months ago. There are very few quicker ways of putting a friendship at risk than doing that!

Instead, source the best real estate agent out there. Do that by casting your ‘net’ as wide as possible. You may know of an excellent agent through a friend who has recently sold a property. If you do, don’t just employ the agent immediately. Pencil him or her in as the first one on your short-list. If you haven’t been referred to any specific agent, the internet thankfully provides a massive amount of easily accessible information. This is particularly relevant for real estate agencies and agents.

 

Spend some time in searching the most prominent estate agencies in your area and have a good look through their agents’ listings. Note that ‘prominent’ estate agencies these days do not necessarily mean the well-known names only. The success you have in the future with selling your home will depend on how effectively your property is marketed and how many potential buyers an agent may reach with the presentation of your property.

So, put a ‘buyer’s hat’ on and visit the internet sites which advertise properties.

There you will see:

  • the properties currently being marketed in your area. This has the added benefit of providing you with a good idea of pricing in your area.
  • the visual presentation of the various properties by each agency. Discard those with inferior photography or poor property listing information. Short-list only those who exhibit the best quality photographs and employ videography and/or drone technology
  • the number of properties featured by an agency and the specific agents. The better agents normally have a number of properties listed, mostly because they are good agents and therefore in demand. At the same time, be careful of those ones with a very large number of listings. It may indicate that they are not selling quickly enough. And how much time are they really going to have available for your property?

You may have to spend a few hours going through this exercise, but selling your home is obviously a very important undertaking. The reward is that you will end up with a short-list of high quality agencies and/or agents to choose from. Once done, either call the agency to send out an agent, contact the agent directly or, in many instances today, just book an appointment on-line for an agent to come and visit.

The objective of such a visit? To obtain a valuation of your property from each agent. It will not only provide you with a good idea of the price at which your property is likely to be marketed at, but you will be able to assess each of the agents in person, in terms of their personality and ability.

NEXT WEEK: ASK ABOUT THE EXACT SERVICE YOU WILL BE RECEIVING FROM YOUR AGENT

Categories
Blog Education

SELLING YOUR HOME – No.1: SELLING YOURSELF VS USING AN ESTATE AGENT

Our 12-week blog series, THE ULTIMATE GUIDE TO SELLING YOUR HOME, starts today.

SELLING YOURSELF VS USING AN ESTATE AGENT.

CLICK BELOW should you prefer to skip this 12-week educational and proceed straight to a FREE EMAILING of the entire document:

 

 

 

 

#1: WHEN SELLING YOUR HOME, DON’T BE EMOTIONALLY INVOLVED

Selling your home is an emotional experience. However, selling your property should always be a business transaction. Being emotionally involved with a business transaction, will most times lead to the making of poor marketing decisions. A Seller needs to understand this.

For instance, you may not see the need for changing, or even upgrading, certain parts of your home for presentation to a buyer. Or you may attach an unrealistic value to your property, because it is the family home.

You need to remember how you felt as a buyer when you first viewed the property. That is, before it became your home. The new buyer has no emotional inclination to the property.

His or her interest is only in whether the property speaks to their specific needs. The only other consideration is whether the asking price justifies the offer on the property.

 

#2: UNDERSTAND WHAT AN AGENT DOES

There are obviously homeowners who do market and sell their properties themselves. If you elect to do that you need to, first, be aware of what that process will demand of you and the best way to do that is to understand what an agent does.

A good agent:

  • Uses his or her access to formal, paid-for property valuation sites to obtain and provide you with a realistic  valuation of your property
  • Will be able to professionally assess the positives and negatives of your property.
  • Advises you on how to best utilise property pro’s & con’s in the marketing process.
  • Understands how to use technology to present your property in the best light through the most effective mediums available
  • Probably already has one or more buyers who may be looking for a property like, or similar to, yours
  • Facilitates the viewing of the property by potential buyers in person
  • Protects you from being personally exposed to any comments on and views of your property
  • Prevents you from potentially having an un-vetted stranger in your home
  • Handles all the price and other negotiations between you and the potential buyer
  • Assists you with the execution of any legal obligations which may be attached to the sale.
  • Facilitates the arrangement of electrical and other inspections and the actual conveyancing process.

NEXT WEEK: PLAY THE AGENT FIELD

Categories
Blog Education

The Ultimate Guide to Selling Your Home

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Blog Education Industry News

Is Airbnb right for me? How do I list my property with Airbnb?

Airbnb has been a remarkable success story- and part of that success could be yours if you have a suitable property you’d like to list. Today Flat Fee Homes walks you through the intricacies of listing a South African property with Airbnb, and the pros and cons of deciding on this way of monetising your biggest asset.

How do I list my property on Airbnb?

Airbnb is a form of short-term rental for your home, bringing in a little extra money from your property without requiring any real investment on your side. It all starts with your first listing, of course- and that’s exactly what we are going to explain to your today.

First steps

The bulk of your work will lie in creating an attractive, appealing listing. Start by heading to airbnb.com, create an account with them, and follow the ‘list your space’ prompt. Here you will enter the basics of the place you wish to list. Their categories each have a clear description, so simply match them up with what works for your property. Room type is the most important, giving the potential guest an idea of the privacy they can expect. Remember that the ‘entire home/apartment’ category is made to include everything, including pools, garages and lapas. Set your ‘accommodates’ number as though you yourself were the guest- at the very least, your future users will expect their own bed, and enough space to arrive with luggage and not be cramped. The last piece is simple- choose your city.

Getting into the depths

Now we’re onto the meatier details of the property. Remember that a faulty listing cannot be changed without serious conversation with the anticipated guest, so take the time to get this right- you don’t want to earn bad reviews and angry guests for a little lack of care. The ‘preview’ button gives you an idea of how the listing will look to others, so use it. The calendar indicates how your property will stay listed, not specific guest dates. That could be a permanent listing, a one-time listing, or for fixed periods of time (like winter or summer). Airbnb will help you by suggesting prices based on the current trends of your area. Don’t be too unreasonable (or undercut) as that will make your property unmovable. You can start a little lower to get your foot in the door while you have no reviews, however. Feel free to do some research of your own for your area as well. You can encourage long-term rentals by making favourable packages, and should always bear in mind all the costs of having a guest in your home- including water and lights and cleaning.

Make a good impression with your title- something that will draw people in, and let the summary showcase all the great features you offer. Personality can help distinguish you from the competition here. Lastly, another important facet of the listing- the photos. Keep it simple- very few are going to look through a 40 photo gallery! Aim for 10 or so, which give a good ‘flavour’ for your place. Would you stay here, if you looked at those photos? Keep in mind the clientele you want to attract, too. Travelling couples are going to want a more appealing nook than a student needing quick lodging. The first 3 photos listed are the ones that will display the most, so put the key ones in that position.

Wrapping up your listing

Now list the special features (amenities) you can offer. Guests like to know what to expect, so be thorough. Now you’ll move through to the listing screen, which should be comprehensively filled in now if you’ve done the first pieces correctly. The last part will need you to enter the exact location. Don’t worry that this will allow privacy violations- it shows only to confirmed guests! Others will see only your neighbourhood and general area.

As you can see, the process is pretty simple, and the Airbnb site guides you comprehensively through most of it. Don’t lie or exaggerate when creating your listing- guests will review you, and lies can cripple your ratings. There’s nothing wrong with playing up your best features, though.

Is an Airbnb listing the right move for me?Flat Fee Homes pig

There’s no doubt that Airbnb can be a nice way to earn some extra income from properties- or even just a room in your house. It’s not for everyone, though. Let’s look at some of the pluses and negatives.

  • Income: Airbnb does allow you to generate a pleasant side income- but not a guaranteed one as you will have with a long-term renter. Income can be erratic. However, the money is a fantastic drawcard.
  • Flexibility: You can withdraw your listing for periods when your own guests will be there, giving you the option to earn from the property when you don’t need it- and use it when you do.
  • Service: You’re effectively letting your home as a lodging. Guests will expect basic cleaning and laundry services. You need to be willing to pay for these or do them yourselves. If you’re letting a room rather than a property, this means you lose some of your privacy and will need to be scrupulously clean while guests are there. Fortunately, very few guests spend a lot of time in their rooms- most are there for their own business, and just want a safe place to sleep and store their belongings.
  • Time: You will need to monitor and respond to enquiries. You will also have to check-in guests, and care for the property. Do you have it?
  • People: Most guests are fantastic…but there’s always the odd anti-social one. Are you ready to deal with potentially disruptive or quarrelsome people? Breakages and other damages can occur- but Airbnb’s insurance will cover you for that, unlike with a renter. You also need to realise you can’t please everyone- there will always be a moaner, no matter how good a host you are. Can you mentally deal with this? Of course, it’s also a fantastic way to meet people from around the globe so this can be a plus. You can also research guests through the platform, unlike with other letting forms, and may even end up with regular guests you get to know well.
  • Marketing: Is handled through your listing, at incredibly low cost to yourself. The booking and payment system is also included, saving you from these added issues.

The short-term rental market, on the Airbnb model, is predicted to soar in the coming years. Is capitalising on this success the correct course of action for you? At Flat Fee Homes we are always happy to assist and believe that a successful real estate investor, is an educated one. For this reason, visit our website for any further information.Flat Fee Homes