This brief article is intended to share some essential points about selling properties, based on our own experience of 50 years of selling properties in Marbella.
Marbella is not a big city like London, Madrid or New York with a captive market within 50 kilometres of the centre. Instead, it’s a small city with a mostly secondary housing market and a buying public spread out all over Europe and the world – a subtle but important nuance.
Most buyers are not looking for a primary residence here, but a second or even a third home. This makes Marbella real estate less of a need and more of a luxury in which people are not drawn to property close to centres of work but to the quality of life a property can offer them. As a result, one characteristic of a secondary housing market is that especially luxurious properties can take a longer time to sell, though in our experience this is considerably shorter where both buyer and seller are serious in their intent.
"The right asking price is perhaps the most essential ingredient in the art of selling real estate."
The most important thing to establish is a ‘sales strategy’, at the heart of which is the asking price. In other words, if you ask too much for your property, people will not bother to view and it will linger unseen. Ask too little for your property, and you are potentially throwing away money. The right asking price is perhaps the most essential ingredient in the art of selling real estate and is the result of thorough market research. Do not opt for the figure you would like to hear, find out the true market value, taking into consideration: what sales of comparable properties have been accomplished, and at what price? What are other owners with similar properties asking?
The more unique a property, the more an owner can ask for it and the stronger they can negotiate when trying to seal a deal. The less unique a property, the more the owners are going to have to resign themselves to the fact that there is a large supply of similar properties, and that they will have to price it competitively.
One thing to avoid, if you intend to use agents to market your property, is listing on a net basis, where you want a fixed sum with the agent’s commission added on top. You can end up with a property marketed at several different prices, leading to confusion among potential buyers. Wise sellers will form a team with their agents and protect their agents’ commission, as they too expect to be protected and advised by their agents, and fix one sole asking price for the property, inclusive of commission.
Should you give an exclusive sales agreement to an agent? If you are an absentee owner, or if you don’t feel like playing a co-ordination role among various agents, granting exclusivity to a leading agent can make your life a lot easier. It also provides the agency in question with the confidence to fully dedicate its energy and resources to the marketing and promotion of the property.
A professional agency will propose a coordinated strategy based on its experience and adapted to the specifics of your property.
This will include the creation of quality marketing material and targeted promotional campaigns.
A responsible agent will try to avoid taking a sole agency unless he sincerely feels that the asking price is correct and that he or she is truly capable of selling the property within the time frame allocated by the seller.
Providing agents you trust with easy access to the home is important in order not to lose potential buyers, though a good agent will screen interested parties first. They will also offer advice on how best to present the property for viewings and approach the negotiation process.
The standard agency fee in a resort area such as Marbella is 5% plus VAT, which covers the marketing, promotion, and listing of properties and the arranging of viewings, follow-up with prospective buyers, property searches, providing background information and support throughout the buying process and beyond. Agents don’t give keys out to clients, they always show properties personally and will spend a great deal of time to find the right buyer.
"A professional agency will propose a coordinated strategy based on its experience and adapted to the specifics of your property. This will include the creation of quality marketing material and targeted promotional campaigns."
The only times this might be considered to be normal is if your property would only be of interest to a small cross-section of buyers – or if it is overpriced. If neither applies, your property is not getting enough market exposure. Our advice: speak to your agent or seek the advice of another well-established agency with a good reputation. An accurately priced and marketed property should be getting a regular stream of clients viewing it.
Are they really? If you are getting lots of viewings and no offers on your property, chances are your property is not as unique as you’d like to think it is. It likely needs to be reduced in price or perhaps you could consider making market-driven renovations in order to increase its appeal. And always remember, selling a property in many ways is a numbers game. The more people who view it, the better chance there is of one of them falling in love with the property and buying it.
With the help of your agent we recommend pricing the property taking into consideration not only similar asking prices, but also prices at which similar properties have actually sold.
Many buyers are very knowledgeable today and will recognize a realistically-priced property, but bear in mind that few will want to pay the full asking price, so leave some room for negotiation.
If you need to sell your property quickly, you need to be prepared to price it at a heavy discount when compared to similar properties on the market. This is when you need a very knowledgeable agent working for you who can suggest the price that will achieve the sale.
First impressions count. When agents take clients to view your property, ensure that curtains and shutters are open to let lots of light flood the property.
Check your agent’s website to see how your property is presented, in terms of the photographs, the description and the accuracy of the information provided. While photography should be representative, it should also present your property as well as it can, enthusing potent ial buyers. To stand out from the crowd you may need professional images, especially indoors.
If there are any small repairs or repainting that would enhance the overall appeal of the property, it’s well worth getting this work done now to eliminate any small ‘objection factors’. Also, make sure your home is spotless for photography and viewings alike.
This always results in enquiries. Many potential buyers drive around different residential areas before going to an agent. Without a sign, they wouldn’t know your property is for sale. Not allowing a sign to be placed is to block one of the many proven paths for reaching the market place. Our experience is that signs still help significantly in selling properties.
Facilitate viewings on as short a notice as possible. If you leave your keys with a neighbour who plays golf three times a week, you are losing a vital chance to show the property at the client ’ s convenience. Bear in mind that the first propert ies that agents tend to show are the ones for which they have the keys. Properties that need appointments to be set up in advance will generally be shown less.
Make sure that you are fully aware of your tax obligations when you put your property on the market. Meet with your lawyer and tax advisor, and find out your options to ensure there are no surprises when you enter into negotiations.
Let your agent form a team with you in handling negotiations, checking points with your lawy er and tax advisor when necessary. This is your agent ’ s job and one of the reasons you pay the agency ’ s fee, and experienced real estate professionals are generally far better at negotiating the commercial points of a deal than lawyers. Once this is accomp lished, your lawyer should take the lead role (in coordination with your agent), draft the sales contract and supervise the completion of the sale. If you are frequently travelling, it can often make sense to leave a Power of Attorney enabling your lawyer to sign a private contract on your written instructions. You can negotiate the details of the sale with your agent by telephone and email, and your lawyer can then take the ‘ first step ’ towards the sale by signing a private contract without delay.
Don ’ t a llow yourself to be pressured by your agent or anyone else to accept an offer! A good agent will simply point out your options and offer advice based on his experience, but once you decide to proceed it is good not to waste time and risk losing the buyer.
In summary, selling a property can be as easy or as complicated as any task involving one ’ s personal affairs. Competent, honest, professional help from agents, lawyers and tax advisors can go a long way to help you manage your sale objectively and easily.
All these items should be agreed upon at the outset befor e lawyers are instructed.