80% of property sellers forced to cut asking prices
http://www.iolproperty.co.za/roller/news/entry/property_sellers_forced_to_cut

Residential property sellers are still unrealistic about the price they want for their homes. In the fourth quarter of last year, 80 percent of sellers were forced to reduce their asking price to conclude a sale.

The average reduction in price by sellers was estimated at 11 percent, according to the results of FNB’s fourth-quarter estate agency survey released yesterday.

John Loos, a strategist at FNB Home Loans, said agents continued to point to unrealistic pricing in the market, with the percentage of sellers having to cut their asking price remaining almost unchanged at 80 percent in the fourth quarter, compared with 81 percent in the previous quarter.

Loos said the average time properties remained on the market before being sold was still a lengthy 15 weeks and six days in the fourth quarter, slightly worse than the 15 weeks and four days previously.

The survey pointed towards a “back to basics” approach to home buying with primary residential demand a priority and non-essential buying remaining firmly on the back burner.

Home sellers expecting too much?
http://www.property24.com/articles/home-sellers-expecting-too-much/12801

Limited access to finance and the affordability of homes are hampering property sales according to South African estate agents who claim that the extensive number of available properties are making buyers more discerning.

Samuel Seeff, chairman of Seeff Properties says that buyers are currently “in the pound seats” although many sellers are still trying the get prices that were last seen in 2007 when the property market was buoyant.

He says that if sellers are still expecting to achieve the 2007 price levels then the house is likely to be on the market for a long time and the number of offers will be limited and certainly below the 2007 levels.

Is it a good idea to sell your property yourself ?
http://www.iolproperty.co.za/roller/news/entry/is_it_a_good_idea

“I usually advise against going the DIY sales route, not because I am an agent myself but because it has over the years time and again proved less than satisfactory.” – so says Anton du Plessis, CEO of the Cape Town estate agency, Vineyard Estates.

The advantage of selling for yourself, says du Plessis, is that the seller will save the 5 to 6% commission which would normally be paid to the agency -and this may enable him either to make more profit or to price the house more competitively.

However, the seller will have to pay for his own advertising and this can easily amount to many thousands of rands over a three to six month selling period.

Furthermore, the buyer, knowing that the seller is operating alone, will often use this fact to negotiate the price downwards.

“Bargaining now starts from the sales price less 5% – it does not include the 5%.”

Cape Town implements plumbing requirement for sale of property
http://www.iolproperty.co.za/roller/news/entry/cape_town_implements_plumbing_requirement

Cape Town implements plumbing requirement for sale of property

In a bid to save water, the City of Cape Town has introduced the plumbing equivalent of a wiring certificate for the sale of homes.

The new rule, in the form of an amendment to an existing by-law, resulted from a suggestion by a member of the public, it said yesterday.

Tune in to your market before setting a price
http://www.iolproperty.co.za/roller/news/entry/tune_in_to_your_market

You may know your own mind when you decide to sell your home, but do you know your own market?

“One thing that is absolutely certain in real estate is that nothing stays the same,” says Tjaart van der Walt, CEO of the RealNet estate agency group. “When one part of the country booms, another could quite well be losing population and real estate demand. And even very popular suburbs can suddenly be perceived as too pricey, causing buyers to focus their attention on more affordable areas that then become revitalized and rejuvenated in their turn.

“So what is up may go down and what is down may go up and no matter what the market conditions were when you bought your property, they are very unlikely to be the same when you sell.”

However, he says, even if your local market is currently depressed, there will be a buyer for your home – provided that it is presented and priced right. “Now everyone knows that your best move in any market is to keep your home good condition, but getting the asking price just right for current conditions is much more difficult, and this is where your estate agent comes in.

It’s Hard to Sell a Unique Home
http://homebuying.about.com/b/2010/08/16/its-hard-to-sell-a-unique-home.htm

It’s not difficult to sell a unique home if it sits in a neighborhood of unique homes, each with its own set of unique qualities.

But it’s almost impossible to sell if that home has been ruined by achieving its unique status. The sellers who own what I would call unique homes did not set out to ruin their homes. They made improvements they thought were tasteful and those that accommodated their particular needs.

Stuart Manning, CEO of Seeff Properties, says that it is becoming more popular that agents encourage the buyers to ‘try an offer of X amount,’ which has been disclosed to them, in confidence, as their clients’ rock bottom price. They are betraying their clients’ trust and they are not keeping their promise to negotiate hard for the best possible price.

Manning also feels that agents should be circumspect in disclosing the reasons for the property being sold. He says that while it might not be detrimental to the seller’s position to mention that a listing is due to a company transfer, disclosing that the seller’s next purchase is subject to the sale of his property could elicit a lower offer from buyers who understand the pressure to finalise a deal – and would be unethical.

Sellers should beware of agents who are not willing to negotiate a better price. They spend so much money on advertising and they tend to cut back on that first during times of financial stress. This greatly slashes the property’s market exposure to buyers. Manning suggests that sellers should insist on a clause in the plan providing that any deviation or unfulfilled undertaking entitles them to immediate cancellation. Agents are taking advantage of sellers, and only to benefit themselves.

Just one or two unattractive features of the house might put buyers off completely. These features might not even be noticeable to you (anymore), but prospective buyers look at your house with a different eye, and it is important that you know how to get and keep their attention.

People want a home that has been taken care of. Maintenance is a very important factor and buyers will immediately see if your house has had the necessary care and attention. Signs of negligence are a real turn-off and can result in serious sellers having to discount their prices.

Tidying up the garden and painting the outside of the house is a good idea. The process of giving your house a mini face-lift might cost you a few hundred bucks, but in the end you will be able to sell your house for a few thousand more, so this will definitely be money well spent. The garden is the first thing that a buyer will see and you should remember that the garden is the window to your home.

If you have a pool, make an effort to clean it up and get the water sparkling again. Carpets and cupboards must be cleaned thoroughly. Make sure your yard is tidy and the lawn is mowed. These are all simple things that you might not have thought of, but a buyer will definitely notice them if they are not done.

Take away the clutter and present a clean, “open” space. Move the furniture around so that the room looks bigger, even if it is not that practical to you. Do not expect the buyer to imagine how things could look after a major clean up; most people lose interest, as they would like to move into a clean neat place. Make sure there are no unpleasant smells in and around the house, such as pet or toilet odours – they can make buyers turn around at the front door.

Unfortunately, buyers still mostly call the shots, so it is important to get your property on the lists of those buyers. Not every visitor that comes to see your property will put in an offer to purchase, but it is a good idea to consider at least one show house as soon as possible after listing the property, as to get your house on the map.

Sitting around and waiting for your house to sell itself is often a waste of time. People want to see everything about a house before making an offer, and a show house is the ideal opportunity to attract buyers and investors.

You need to make sure your agent is up to date when you do show your house. They need to know what the neighbourhood is like and all the special features of your home. The agent must be knowledgeable on the positive aspects of the house and the area.

Make sure your house is in a very clean and neat state and consider painting a few walls and tidying up the garden if necessary. Buyers will immediately be turned off from buying the house if the view is unpleasant. The agent can assist you in pointing out areas that need attention.

There is a downside to this though, offers to purchase might bring uncertainty, especially if the seller has been given a limited period of time to make a decision or if they have just put their home on the market. Most sellers wish for more time to make such a huge decision, even more so in cases where the offer is lower than they would have liked.

In South Africa, an offer is usually accepted or declined within 48 hours but there is no set period for sellers in which to make a decision. For sellers whose houses have been in the market for quite a while, it is far easier to make a decision on when to accept an offer than for those who have just put their homes on the market.

New sellers sometimes fear that their homes are under-priced, especially if they start receiving offers to purchase immediately after putting their house on the market. According to Mike Bester, CEO of Realty 1 International Property Group, sellers are likely to sell their homes for the best price when the property is newly listed. Buyers always want to know how long a property has been on the market and why it hasn’t sold and if the property has been on the market for too long, buyers will either back out or offer a lower price.

Bester advises that sellers should try to avoid rejecting offers that do not meet their expectations. He says that you should rather consider countersigning it, which will give the buyer the opportunity to improve on their offer.

Most estate agents will show homes to their serious clients within its first 72 hours of market listing. This is why many homes attract the most attention very soon after its listing and a seller should never assume that these early offers are not serious. Agents also tend to make potential buyers aware of this initial intensity of purchasing competition and encourage them in making the best offer possible.

The shorter a home is listed on the market, the more likely it is to attract its best selling price. Many sellers make the same mistake and believe they can always go back to the first offer if nothing better comes around. Unfortunately, this is rarely the case as that particular buyer might have bought property elsewhere or that person has become suspicious about the sellers sudden change of mind and starts thinking they might have offered too much.

Sellers are encouraged to do some research on their area and home before listing it on the market. They should know the area and what the same sort of houses sells for in the area. They should also appoint a real estate agent with the necessary knowledge and expertise, that is also someone they can trust and the agent must be willing to help and guide the seller in the right direction.

When a buyer moves into a new property before the transfer has gone through, the seller and buyer will agree on the occupational rent amount, as based in the offer to purchase. The intention of occupational rent is normally to cover a bond repayment if the seller still has a bond to repay, however, the bond amount is not a true indication of how much the occupational rent should be.

Occupational rent does not protect against anything, it is simply a payment for the use of the seller’s property. According to Linda Erasmus, chief executive officer of Fine & Country South Africa, a real estate group that assists in the marketing and sale of top-end properties, the buyer rather than the seller usually delays the transfer. The buyer should deliver should be able to prove that the transfer is processed on time.

Seller’s sometimes delay the transfer process due to insufficient funds to pay the outstanding rates and taxes account. Erasmus says that it is good practice to include a clause in the offer to purchase, which states that the seller warrants that the electricity, water, rates and taxes have been paid in full.

The occupational rent clause will not come into effect when occupation is taken on transfer, but it is advisable to negotiate a rental amount upfront as the buyer might wish to move in earlier than originally expected. By agreeing on a rental amount upfront, potential problems are eliminated.

For the seller’s protection, it is wise to agree that the occupational rent amount will increase after three months, which will put pressure on the buyer to deliver on his/her promises to the seller, as the seller no longer has control over the property once it is handed over.

Take a look at your house. Will you be interested in buying a house like yours? After living in a house for years, one tends to forget about the walls that need paint or the garden that needs a little attention. You might not be bothered by the faults of your home, but buyers will be put off if your house is not in a good condition.

So where should you start? Well, firstly, take a look at the paint. If your house needs paint, inside or out (or both), have the house painted. It might be expensive, but it will help you achieve a better price for your house, far more than what you spent on repainting it. Secondly, make sure your floors are in good condition. If you have carpets, have them cleaned, if you have tiles or wooden floors, have them polished. Make sure the windows are washed and the house is clutter-free. Fix any holes in walls and replace broken or chipped tiles and taps. It is important to make sure all bathroom and kitchen appliances are clean and neat and in good working order.

Clean up the yard and spend some time cleaning up the garden. The lawn must be mowed and the plants must be watered. First impressions last and buyers will see the outside of the house first. Spend time and money if necessary to create a garden that is inviting, open and neat.

A house inspection is advisable. This will save time when buyers want to put an offer on the house. Home inspections remove the various doubts a buyer usually has when wanting to buy a house. If you don’t have a home inspection done, the buyer will do so themselves. Home inspections add a professional approach to the documentation involved and the property disclosure statement if the deal is closed.

If you are unable to sell your house yourself, hire a realtor. They are professionals and will guide you through the selling process. They can also help you obtain the maximum price for your house, with minimum expenditure.

You have to know what time of the year is the busiest time for real estate sales. It varies from city to city. Buyers cash-in on the high interest rates when the prices fall, since they can pay less.

Always keep your house ready. When potential buyers pay an unexpected visit, be available to answer questions and show them around.

You need to start seeing your house as a product to be marketed and sold to the public. It is not an easy step to take as many people live in their houses for twenty odd years and have experienced great memories over the years.

Get your house surveyed. This does not have to be an expensive survey. It is a simple report to hand out to estate agents and potential buyers. The survey will identify any potential problems early on so that you can have them fixed. The survey can act as an important marketing tool to show that you have taken good care of your home. Estate agents can market your house with more confidence if they know your house is in a good condition and that you are open and honest about the home’ faults.

You need to look at your house with different eyes. If you were house hunting, would you be interested in your house? Is the garden and yard neat and tidy? Ask friends and family to take an objective look at your house and help you notice faults. Estate agents’ views should also be taken very seriously as they are professionals and know what buyers want.

Make sure to complete any DIY projects that you have started (and not finished) before putting your house on the market. Buyers don’t want to move in and start working straight away.

Know your competition. Similar houses in your area should be viewed and notes should be taken of their best features. This will give you an idea of the competition in the area and help you recognise your own home’s faults.

Make your house clutter-free. Buyers find it hard to visualise what the house looks like when it is full of clutter. Excessive portraits, sculptures and other ornaments should be stored for the period that buyers come to look at your house. This doesn’t mean you have to get rid of your pets or pack away your entire house, just make sure it is as clean and neat as possible and store away some of the unnecessary “stuff” that you like in your living room.

If you take these steps and get the opinion of outsiders, you should be able to make your house stand well over the competition.

Most people that go to look at houses to buy would like to be able to visualise themselves, their furniture and their decorations in the house. If your house is cluttered and untidy, it makes it difficult for prospective buyers to do this, which might result in them losing interest in your house altogether.

Your house should be clean and uncluttered and minor repairs should be fixed. The kitchen and bathroom are two of the most important areas of a home, so make sure these are well maintained and clean. A fresh coat of paint is always welcome. It is not wise to totally renovate your kitchen and/or bathroom for the purpose of selling, as the future buyers may not share the same taste as you and might be turned off from buying the home.

Make the most of your space by taking away unnecessary ornaments, paintings and photographs. People find it hard to imagine a full, cluttered room as a big living space. Mirrors are a good, clean way of decorating and create the illusion of space. Remember that less decoration is more.

Make sure the windows, windowsills and doors are clean and in good working order. Clean all curtains, blinds and carpets. Make sure the bedrooms look inviting. Get rid of any unpleasant odours and stains and make sure your couches are cleaned.

It is important to clean all light fittings, ceiling fans and air conditioning systems. Remember, prospective buyers look at a house from a different point of view and the cleaner your house is, the better. Make sure all light bulbs are in working condition and that all spaces are visible. Some prospective buyers will come to look at the house in the evenings, so it will be necessary to switch on the lights.

The first impression that buyers get from your house is the outside. Clean up the garden and mow the lawn. Trim hedges if it needs to be done and make sure your windows are squeaky clean. It is wise to put a welcome mat at your front door, just to add a touch of cosiness.

Renovating your home – whatever your reasons – is always a step in the right direction. It will most certainly increase the value of your home and you can be sure to make a solid return on your investment.

Remodelling your home is not an easy task – especially if you consider the fact that not everyone share the same taste and it is advisable to keep a neutral design if you are planning on selling your home in the future.

It is very important to consider the costs involved when deciding to renovate or remodel your home. The financial capacity of the homeowner should be considered and a budget should be drawn up accordingly. Prices of cement, paint and other materials to be used should be checked first before touching or destroying any part of the home. If the project cannot be completed due to insufficient funds, you will actually decrease the value of your home – instead of increasing it.

Another very important aspect to remember is that a plan is needed if you are planning to remodel the home in terms of destroying and building. You need approval of the municipality and make sure that your plans will not cause problems in the overall structure of the house. Many people make the mistake of skipping this step only to find out later that all their effort and money spent was useless.

If you plan on hiring a contractor, make sure you get referrals for the contractor. There are so many sharks in the business of building and renovating and having someone doing a poor job is worse than not doing the job at all. Make sure you know the background of the contractor and speak to people for whom he has worked before. It can cost you a lot in terms of time and money if you have a contractor that does inferior work or leaves before the project is completed.

Some homeowners make the mistake of overspending when it comes to renovating their homes. They spend more on the remodelling project than what is reasonable and this is when s/he can no longer resell the house at a price that is in the range of the real estate rates in the community. Spending too much on a renovation project can only be justified if the homeowner is not planning on selling the house but rather preserving the home to his family for a long time.

Following the latest trend is not always a good idea. Fashions come and go and you cannot always change your house to suit the flavour of the month. Classic home designs are still the ideal for home remodelling projects because such designs never go out of style and will always attract buyers when you are ready to sell your home. Using extravagant colours and designs will make it harder to find a buyer that shares the same taste or one that is willing to buy the house and renovate again.

To renovate or remodel your home is always a good idea and money spent on your house now will most likely double by the time you resell your home. Make sure you know what you are doing and avoid these mistakes at all cost.