When you start in realestate your are probably wanting the stunning homes that sell for millions of dollars, the problem in selling these homes is that the buyers in this market expect perfection, something that is very hard to deliver. Therefore, when you get listings that are less than perfect, use these tips to get a sale and push the focus on the upside.
1. Sell the future:
Whenever you're selling a home that is less than perfect, focus on the potential and what can be. People buy dreams, they don't buy homes, so before you open the door to any prospects, do the research on the potential upside this home could have. If there are plans that are approved, then explain the redevelopment potential. If not, then talk about minor changes they can make that will have a big effect on the liveability of it.
2. Sell value:
The reason people buy homes with upside is because they believe they are getting something of value. As we have seen on "The Block" just renovating a home and then selling it, won't necessarily give you bags of money. Break the home down to simple math. Explain what the land value is worth, and what the house is worth. Explain how hard it is to find land for that value and the value you can add. Explain really simple five key ways the seller can add value. From new tiling, knocking a wall down, applying for a permit, or any other idea. You will have them seeing the potential then.
3. Be blunt:
A potential buyer wants to know bottom line how much this will cost and the potential return on investment. Therefore, you should before the inspection, speak to a local council and ask how long it would take to approve plans for redevelopment, and the fees involved. Also ask their suggestions on all the alternatives they think would be possible. Once you have this information, tell the prospects that the redevelopment ideas are already in the pipe works, the council is willing to work with them on this, and expedite the process to prevent them being out of pocket for too long.
4. Use a case study:
A great way to sell a home that has redevelopment potential is to point to case studies. As an agent you should be well versed in the local market movements and what people have done in the area. Prepare a list of case studies where people have bought similar homes to this, and redeveloped it or added value and sold it. This will provide precedence and also confidence to the potential buyer that what they want to do is doable.
5. Get some basics amended:
Before letting people in to the home, it can't hurt doing some basic amendments. This can be as simple as a coat of paint and some new carpet. Whilst you will have to outlay some money for this, it provides the potential for the redeveloper to also rent the property out whilst they get their plans ready or even live in it themselves. The cost may be ten or twenty thousand dollars, but in the long term, the ability they will have to earn a rental income whilst they wait for plans to be approved can be massive.
6. Explain why the demand will increase in the area:
The person who buys a home that needs a lot of work won't be buying it to make money straight away, rather over the long term. Explain the urban growth and why this area will add value in the long term. Will there be increased infrastructure in the area? Are people and councils putting a lot of money and time in to cleaning the area up? If so, explain how in the next few years there will be added benefits and a lot of positive changes. This will help provide a visualised future of what demand for the home could come.
Ultimately, the person who is buying this home will need to buy in to the upside you are offering. People are very reluctant to buy redevelopment's and homes that require a lot of intense work in the project as they are weary that the time and effort involved could cost some serious money. If you explain the above 6 points to them, and give them increased value on why this property will increase in value, and why this project is worth taking on, then you can increase your consumer interest, and hopefully get more for the vendor.
Todd Schulberg handles all things marketing for Homely.com.au - Living and breathing property, Todd has a keen interest in the movements in the market and how agents can utilise new tools and technology in order to be more connected. Using all things social, Todd suggests different ways that agents can engage and think outside the square with their marketing approach.