The importance of the approach taken in a new build development, should never be underestimated. Most developers are reliant on an estate agent to not only value the site and list the properties online but also sell the units. From my experience, some agents completely underestimate their role in this process.
The Valuation Process
Most agents believe that the developer wants to hear the highest possible valuation and of course they do but an unrealistic value could ultimately provide an overvaluation of the land. This however, is one of the common mistakes in this process and if anything the most important. The Developer is relying on the figures at the start of the process to not only determine the land value but also his overall profit from the site. Some agents believe the only way to list the property is to price high and over exceed the clients expectation. Originally this may look great but as with every house sale, once the houses start to stagnate, the prices start to tumble and then the developer is left with nowhere near their original valuation and in some instances cannot even make a profit. This ultimately falls with the agents original valuation and starts to affect their relationship with the developer as they cannot say the prices are too high as they were the ones who originally valued the property. This in turn means they have lost respect from the developer and the opportunity to work together on future projects.
The Listing Process
How important is the way the properties are introduced? In my opinion, this is probably the one most important role of the agent throughout this sale process. Where are they going to market? How are they going to market? Which sites? Will social media be used? what promotions can they offer? How is the agent presenting the properties and how are they being received by the marketplace? All important questions to consider. After recently selling a new build site from start to finish where the owner had the properties on the market with another agent, this really opened up my eyes how much the agent can do.
Errors of the old agent:
- All properties were listed on the same day
- poor marketing banner
- No social media presence
- No coming soon advert
- Dressing of Houses were not considered and owner was actually advised against this!
- Professional photography
All of the above are core functions in providing a consistent and positive approach and keeping interest with the New Build Site. The site we recently sold was de-listed with a local agent and given two weeks to allow a fresh approach, a banner was ordered on site (eye catching with limited information but enough to force people to call up), with extra boards marketing the properties as “for sale”. No online presence at this time, people therefore had to call to register their interest. We built up a list of applicants and then added a coming soon banner online via Social Media, linkedin, instagram Facebook. This already gave an initial buzz around the property. Next we dressed two show homes and then took professional photography of the full site. We then listed one property of each type with specialist marketing brochures. The initial feedback was great and we had offers on half the site before we even had half the site listed online, we continued a marketing presence on social media. Consistent and professionally, we created a wealth of viewings, we were then able to list new properties to the market each week and keep a continuous flow of activity. A second open day was ran and the remaining units were sold. How could the other agents do anymore after originally listing all the properties to the market at the same time?
The Sales Process
Each client purchasing the property was advised to use a local solicitor, it was not enforced specifically upon any clients but having a relationship with a local reputable solicitor really helped. Each client paid a reservation fee and was given timescales up front. All parties were aware of this when the memorandum of sale was issued, it clearly detailed all requirements. The clients had 7 days to instruct searches and survey (Everyone complied), this would enable all the sales to be ready to exchange in 6 weeks and all duly exchanged inside 8 weeks setting completion. The buyers were happy to listen and take advice, the owner was happy to listen and take advice. The importance of the original valuation and honesty was integral to this process and in the end a smooth process was provided.
If you are a developer and would like help regarding valuation of land or new build sites, please do not hesitate to contact me.