PROPERTY: It Pays to Keep Your Price Down and Sell Faster
Recent Gauteng Business News
Sales of residential properties are showing a definite upward trend, and home sellers should take advantage of the situation by aiming for quicker sales rather than raising their asking prices.
That’s the advice of Harcourts Africa CEO Martin Schultheiss, who says: “Sellers are always very slow to react and lower their prices when the market declines, but can’t wait to raise their asking prices the minute the market shows any sign of improvement.
“However, if they really want to benefit from the current resurgence of confidence in property, they should be doing all they can to achieve a faster sale – and especially making sure that their asking prices are very competitive.
“There are three reasons for this, the first being that although demand is increasing, buyers are still being very choosy. There is still a plentiful supply of properties for sale and they are under no purchase pressure, so have the time to carefully weigh up which homes really offer them the best value for money.”
Secondly, he says, bank lending is still slow and very cautious. And it stands to reason that a property at a lower price will be more affordable to a great number of potential buyers, so the seller has a much better chance of attracting a buyer who can qualify for a home loan.
“And finally, achieving a quick sale definitely means big savings in holding costs, while the results of raising your asking price are at best uncertain.”
Schultheiss notes that the average time that a “well-priced” property is on the market before being sold has dropped from around five months in the middle of 2009 to around three months now, “which means two months’ savings in terms of bond repayments, for a start.
“Then there are municipal rates and service charges, insurance premiums, maintenance costs or levies and security costs to consider, adding up to a significant sum of money that you should rather be spending on your new home.”
Business News Sector Tags: Property|