Pitch to the investors, says expert
Serious home sellers should start specifically targeting investors.
Thats the advice of Roy Leigh, principal of the Nationlink office in Sandton, who says that savvy investors who have spotted the opportunities inherent in the current scenario are streaming back into the market.
We are not talking here about speculators hoping to make a quick profit on resales, he says, but long-term investors who believe in the future of property and are taking the chance now to add to their portfolios and achieve major capital growth in the next upturn.
And they are to be found at all levels of the market, he says. There is interest right across the board, from those who are scouting for bargains at auctions, through those looking for run-down houses in good locations that they can renovate and right up to those looking for upmarket apartments they can rent out to corporates.
Such buyers, says Leigh, will obviously put downward pressure on sale prices, as they are usually tough negotiators who believe that the profit on a property is made when you buy, not when you sell.
However, the good news about their growing presence in the market is that it will help to absorb the current over-supply of property. And that, together with the slowdown in the delivery of new developments, will shortly create an undersupply that will bring about the turn in the market perhaps sooner than expected.
Meanwhile, he says, homeowners who are determined to sell now should consult their agents on specific strategies to attract investors. If you are selling a buy-to-let property, for example, your advertisements should emphasise how easy it is to find or keep a tenant in this location, and what sort of return the buyer can expect to make as the new landlord.
What you should also consider is to discount the price of your property now by giving a range of parameters that will tempt the investor and the serious buyer who has affordability problems brought on by the ruinously higher interest rates.
This will ensure a sale and you will then avoid the future drop in the prices that will inevitably follow as house prices fall further before stabilizing, hopefully in the not too distant future.
Article from: www.nationlinkproperty.com