Selling property privately in South Africa
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Betty and Jim van der Merwe are expecting their third child. Their modest two-bedroom home has become crowded. Extending the house would be difficult, taking up most of the already small garden.
Having done some house searching, Betty and Jim have found their ideal home. With three bedrooms, two bathrooms, a sizeable garden and situated two blocks away from the kids‘ school, the property is perfect.
But the sums to secure the new house are tight. The asking price of R900 000 is not negotiable. Based on Jim‘s salary, the Van der Merwes qualify for a R600 000 bond, leaving them R300 000 short of the asking price.
Their current home has been valued at R580 000 to R620 000. As their bond on this house is R300 000, they need to raise the needed R300 000 from the sale.
With estate agents charging anything between 5 per cent and 7,5% commission plus VAT, even if Betty and Jim managed to get the top end price of R620 000 for their home, they would still fall short.
They need to maximise on the sale price of their home by selling it themselves.
“The idea of selling your own home can be daunting,” says Ian Ward, MD of private property sellers Private Sale. It just requires a change in mindset. With the right preparation and research, the process is accessible and can go very smoothly.”
Ward explains how selling your property without the use of an agent not only forces a more realistic asking price, but enables the seller to enjoy a considerable saving – pocketing what would have been the estate agent‘s commission.
The process is simple. The first step is to do research to reach a realistic asking price.
“Most people tend to have an over-inflated idea of what their property is worth, and it‘s not uncommon for estate agents to set a valuation too high to secure a sales mandate for the property. Properties sold by the sellers themselves tend to move quickly.”
To determine a price, you are entitled to use the services of an estate agent for a valuation without being obliged to give them a mandate on the property.
Once you have determined the value, marketing your house is the next step. Internet property listings are becoming increasingly popular. Advertising in your local newspaper and distributing flyers are inexpensive ways of spreading the word.
“Perhaps the most effective method of increasing awareness and exposure is the ‘sunshine showhouse‘ method. Just as estate agents do, you can place show boards in your area as pointers to your property. Sundays are traditionally show days for estate agents, and potential buyers are drawn to an area by advertisements in the property sections of the local newspapers. Individual sellers can maximise on these property browsers by showing their own homes,” says Ward.
“Agreeing on the price is perhaps the most delicate part of selling your own home. The negotiation process can be difficult and it is always advisable to make use of a third party to negotiate on the seller‘s behalf, particularly if the seller does not have strong negotiating skills. The seller should have a price in mind that is the absolute minimum they would be willing to accept, and be determined never to go any lower,” he says.
The paperwork involved in the sales process need not be complicated. The sales contract is freely available off the internet or from any stationery shop, and needs to be signed by both parties. Two attorneys need to be involved in the legal process – one appointed by the seller to handle the sale and another to manage the bond on behalf of the bank. All legal costs are carried by the buyer.
“Sometimes the sales offer process can have hitches. For example, a person might make an offer subject to selling their own property, which might not be easily marketable. In the excitement of receiving the offer an inexperienced seller might accept and unwittingly become tied into a contract without including a meet-and-beat clause in the agreement. This would give the buyer first option on the sale but require any offers of other interested buyers to be matched or raised.”
Authored By: By Linda Doke
Published By: weekendpost.co.za
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