Your Guide to Selling Property
As Omicron runs rampage and we enter unprecedented times, a rising number of homeowners are opting to sell their homes. Lockdowns, restrictions and uncertainty are tarnishing what was once the Orient’s crowning jewel. The events of the past couple of years have without question caused tremendous economic turbulence in the territory, resulting in a big shake-up in the housing market. If you are thinking of selling your property, here are some important tips.
1. FINDING AN ESTATE AGENT
There are several ways to sell a home. Consulting a licensed Hong Kong real estate agency is the first step. Not all real estate companies are created equal, and agents may price you out of range if they are angling for your listing. At Nest Property, we take pleasure in being well-versed in Hong Kong’s ever-changing real estate market. Our agents are licensed, experienced, and qualified professionals with a proven track record of success. They can effectively represent and help you in your negotiations with a potential buyer. Take note also of the service offering for that 1% fee. Will they share your listing with other agencies? How will they market your property and will they bring in a professional photographer to take photos? These are the sorts of questions that need to be asked. Many agencies these days charge 2-2.5% but for that increased fee, they will provide a full-service offering and also take away the pain of managing & showing the property, and ensuring it is always looking it’s best. This is something that is particularly important to think about as more and more vendors are out of Hong Kong and selling their properties remotely. You need an agent by your side that you can not only trust but who you can communicate effectively with, in a succinct fashion, rather than in dribs and drabs of poorly written WhatsApp messages.
2. PRICE ACCORDINGLY
It goes without saying that if you list your home for an extravagant price, you will almost certainly have to lower it later. It may take longer to sell, and it may affect whether or not buyers will be interested in your listing. People in the market will become skeptical of properties if the price continues to fall. It’s a warning sign that the home’s condition may be in jeopardy. It can oftentimes also be seen to indicate a tricky or insincere vendor. This situation may have a negative impact on your negotiating ability. So the moral of the story is ‘price to sell’. No point over-pricing the property (or falling for the flattery of the agency that will sell you on an over-inflated price) only to have to keep discounting the property and risk looking like a bargain-shelf asset. Not to mention lose out on genuine potential buyers. Also bear in mind the bank valuation and stamp duty thresholds. A slight adjustment can make a big difference to a potential buyer’s borrowing potential and/or stamp duty savings.
When it comes to property renovations before a sale, there are no hard and fast rules. The asking price has to accurately reflect the holy trinity of location, condition and size. The impact of remodelling may be largely determined by market circumstances and the current value of your existing property. In not all cases is it worth renovating before a sale. The cost of the renovation may not be appreciated and reflected in the final sale price as everyone’s tastes are different. Better to tidy up and ‘freshen up’ a property so it’s looking clean, bright and as spacious as possible, rather than invest in a new bathroom or kitchen. People will tend to buy or the finished article (where everything is brand new and newly renovated) that they can move into straight away, or properties that have two out of three of their wish lists – such as in the right location and to their desired size – but with lacklustre interiors, with the view of renovating it in their own time after purchasing, provided a good price is achieved.
4. ACCEPTING AN OFFER
Once you and the prospective buyer have agreed on a price, your agent will draw up a Provisional Sale and Purchase Agreement (PSPA). Once the agreement has been signed by both parties the buyer’s solicitor will verify the title of the property under consideration with the Land Registry department and matters will then be handled by both the vendor’s and purchaser’s solicitors. It’s important therefore that start engaging a lawyer or thinking about who you might use. Your consultant can also provide recommendations and refer you to a suitable lawyer. Once the title has cleared, and the property has been inspected, both parties proceed to sign the formal Sales & Purchase Agreement.
If you have any concerns we can guide you throughout the whole process. Get in touch with one of our consultants.