Finance

Finance Real Estate

Tips on selling your Property

Sell before you buy

A seller is unlikely to accept an offer from a buyer whose own property is not on the market? By all means, get an idea of what you want to buy and make sure your moving plans are feasible, but before you start making offers, you really need to be sold on contract. Real estate agents rarely recommend that their clients accept an offer from a buyer with an incomplete chain. A rare exception is when a homeowner has a property that sells well. Perhaps one in the catchment area of a popular school, e.g. Raffles Primary or Ai Tong Primary or a house that that cannot be sold for a long time.

Choosing from the most active and top property agent.

A client by the name of Jenny Chou mentioned that she chose an agent because she liked the looks of him, but you’ll probably want to be a bit more scientific in your approach. The best indicator of a successful real estate agent is how many listings they have on the market. Don’t be too impressed, though, if most of the listings say Cheap sale – that could be the result of a special promotion where the commission is lowered or eliminated altogether. The latter can work and save you money, but be sure to read the fine print. After the promotion ends, the fee may be double again what other realtors charge. A “sold” board means the job is done. If an agent recently sold a property in your neighbourhood, he may have had more than one interested buyer. If this is the case, he probably has a list of people who lost out on that property and are ready to buy your property – saving you weeks of viewings.

A sole agency contract is where an estate agent is appointed exclusively to sell a property for an agreed period of time, usually 3 months. During this period, the seller should not switch to or instruct another agent – if they do, they may end up paying more than one commission. Even if a seller who signed a 1 month sole commission cancels the contract halfway through, they can still be held liable if another agent sells the property during the remaining five weeks of the original sole commission.

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With a multiple agent contract, there are no limit on how many agents a homeowner can hire, nor is there a fixed term. The agents market the property at the same time, and the seller only pays the one who introduces a buyer who closes the purchase contract.

Both types of contracts have their pros and cons. The commission rate for single agency is cheaper than multi-agency, but if you use the wrong agent, you are tied to them for the duration of the contract.

With a multi-agency, you are not tied to one broker and can play the brokers you choose against each other. While this keeps them on their toes, it can also keep them from being honest with you. Let’s say your only broker introduces you to a buyer who offers full asking price. Unfortunately, this buyer has an incomplete chain under him. Your broker advises you not to accept the offer until the chain is complete, which is sound advice. Now the same scenario, except this time there are four brokers vying for the commission. The information provided to the seller may vary. The buyer may be portrayed as being in a stronger position than they actually are, so the offer is accepted and the other brokers back off, buying time for the less truthful broker.

Hiring too many brokers can also give buyers the wrong impression.

 I once witnessed a owner give a house he had renovated to five different agents to market. All the agents advertised the property on propertyguru, which meant the property appeared on the search results page five times in a row. Did potential buyers think the seller was eager or desperate? A stream of low offers revealed that the latter was the case.

If you decide to use a realtor, don’t commit to a long contract – six to eight weeks is a good amount of time. If you’re happy with the broker, you can always renew an expiring contract.

If you prefer a multiple agency, stick to a maximum of three property agents. And if possible, hire ones that are strong in different type of clients- that way you’ll have a larger area covered.

Negotiate asking prices and fees

When properties are scarce, competition between estate agents can be fierce. It has proven to be a reliable tactic for agents to give potential sellers an inflated estimate of their home in order to win business over their competitors. As a seller, this can work to your advantage in a rising market; at the beginning of the contract, the property may be overpriced, but by the end of the term, when the market has recovered, the price becomes realistic and the property sells. If the market cools, you could be stuck, unsold and with an agent now recommending a price reduction.

Finance Investment Real Estate

Success story of Singaporeans who invested in real estate

Offering what the property owner wants is one of the main mistakes an investor can make. Never forget that all sellers want to make as much money as possible. In real estate investing, it’s your job to pull their prices down so you can profit more from the investment. You have seen many other people who have been successful with real estate investing. A quick search on the internet reveals tons of inspirational stories about real estate investing. However, only a few of them actually offer you lessons on how to profit from real estate investing.

In this article, we want to buck that trend.

We’ll share the story of a couple investors who put in the work and uncovered some great opportunities. We’ll also share some lessons you can take away from their success.

Janet and Nick wanted an investment that would earn them a Six-Figure Return.

They had spent a while looking for properties in Singapore. They had gone through the property listings and nothing had piqued their interest. So they contacted some good real estate agents and managed to get some good viewings. It’s a good thing they did, because in the end, a great property presented itself to them.

The property was an estate with a list price of $1,580,000. There were three beneficiaries, two of whom were still living in the house.

This presented an opportunity for the couple. Estate prices are usually negotiable when the money received is divided several ways. Janet and Nick took advantage of this fact to make an offer for less than the sale price.

However, they went about it a little differently than most.

The property would have been auctioned in May 2016, just before June Holidays. Most investors would rather wait for the auction, hoping to get a bargain. But Janet and Nick knew they had a chance and bid $1,525,000 before the auction.

Importantly, that offer was subject to building and pest appraisals.

These reports showed that the property was severely damaged. As a result, the couple lowered their bid to $1,510,000 to account for the necessary structural work.

This story has probably given you some insight into how to become a successful real estate investor. You can see that Janet and Nick did everything they could to secure their purchase for less than market value.

They also made their offer contingent on several inspections. This allowed them to lower the purchase price even further.

Both are great lessons for anyone looking to successfully invest in real estate.

But there’s more to the story that we haven’t shared with you yet. Here are three real estate investing tips you can learn from Janet and Nick

Tip #1 – Find a good real estate agent.

By sharing the couple’s story, Nick revealed how important their realtors have been:

“There are some really mediocre realtors out there. But we’ve found two different realtors who are top notch and go out of their way for us. They know what we want.”

There are two things you need to know when it comes to real estate agents.

First, you want the best ones you can find in your corner. These are the people who will understand what you want and can help you get it at the right price.

Second, you want the mediocre agents to be in the seller’s corner. This gives you the ability to control the negotiations. And it also means you’re dealing with a seller’s agent who is more concerned about making the sale than doing what’s best for their client.

Tip #2 – Build a Strong Network of contacts.

What we didn’t tell you in the story above is that Janet and Nick didn’t buy their property on their own. In fact, they were not in a position to buy anything on their own.

Instead, they worked with money partners to make their investment happen. And as Janet explains:

“I wasn’t able to find one who had all the money. But I was able to find six who had some of the money, and that was great.”

It just goes to show how important it is to have a strong network around you as a real estate investor.

When you need a money partner, it’s your network that usually reveals the right person for the job. And if you have a great network, you can secure multiple partners when you need them.

Simply put, your network gives you more options. Not to mention the opportunities that people in your network can give you.

Tip #3 – What doesn’t work for some may work for you.

We’ve already mentioned how Janet and Nick bypassed an auction – something many investors wouldn’t do. However, it’s also worth noting the time period in which they bought.