Selling your property can be complicated and time consuming. Problems can arise at any stage in the process, and may cause long delays
Posted Date: Mar 10, 2010
By: Chan Ai Cheng
Selling your property can be complicated and time consuming. Problems can arise at any stage in the process, and may cause long delays. For example, the buyer may reduce their offer at the eleventh hour or even pull out before the signing of the Sale & Purchase Agreement, the conditions of the sale may not be agreeable to you, the buyer faces problems securing property financing or the property may be damaged before the completion date.
Below is a quick step by step guide to selling your property:
Step 1: Determine the price of your property
There are a number of quick ways to determine the going price for your property. The quickest and easiest way is to check for asking prices of similar properties in your locality from classified advertisements in the daily newspapers or on the internet at popular property websites. The increasing numbers of property search websites have made it easier to secure asking prices data for comparison. There is a difference, however, between asking prices and what that property will eventually transact at. In most instances asking prices are higher than transacted prices.
Property valuers are professionals in their field, authorised to produce reports on the rationale behind the value of your property at a particular time. You can use their service to determine the price of your property.
Step 2: Choosing to work with an estate agent
You have the option here to either market and sell the property on your own or to appoint a professional whose principal business is in assisting sellers to sell their property and to source for suitable premises for buyers or tenants. It is important to pick the right professional to undertake the marketing and sale of your property. Criteria should be based on the firm’s track record, the individual estate agent’s track record and their familiarity with the type of property and location where your property is located. It is always most effective to work with a local estate agent who specialises in a particular type of property or who focuses on a certain location.
Step 3: Appointing your solicitors
It is advisable to appoint your solicitor at the same time as choosing your agent. In most instances, sellers only appoint a solicitor when they have secured an offer.
Appointing one at the onset will help to avoid delays and allow time for the collection of necessary documentation involved in transferring ownership of your property to the new buyer. Whichever the timing, it is important that a solicitor is appointed by you to represent you in the transaction in case of any eventuality.
Step 4: Marketing your property
Get involved in the marketing of your property with your agent. This will include signboards, advertisements, flyers and the likes. Property search websites today prove to be new means of advertising at much reduced rates. Slowly and steadily the popularity of this option will increase as the computer literacy of the population increases.
Signboards are one of the most effective tools to generate enquiries as interested parties who are looking at properties in the locality will contact you.
Step 5: Viewings
Most viewings are conducted in the evenings and on weekends as this is the time when prospective buyers are available. It is important that you prepare yourself and your property for viewings. Your property should be clean and neat, where possible to attract prospective buyers.
Step 6: Accepting an offer
If a buyer is interested in your property, the buyer may decide to make an offer to buy it. This is normally done through negotiation with your estate agent. The buyer does not necessarily have to offer the asking price, and the price you get when the sale is final may be different.
If you are selling your property privately, the buyer will probably make the offer to you directly. If you get a private offer but you have signed a contract with an estate agent, you may still have to pay professional fees depending on the kind of contract you have.
If you are using an estate agent, the buyer will probably make an offer through the agent. You should be told about any realistic offer that is made. The estate agent may give you advice about whether the offer is reasonable, but it is up to you do decide whether to accept it or not.
Many buyers will make an initial offer below the asking price, so you should expect to negotiate. However, when there is a lot of demand, some properties may eventually sell for more than the original asking price. The price you are likely to get usually depends on:
- Whether property prices are rising
- Whether your property is in a popular area
- Whether the asking price is realistic compared to similar properties
- How quickly the buyer wants to move
Your estate agent should be able to give you an idea of what you have been offered is reasonable. However, it may also be worth doing some research to find out what similar properties in the area are selling for. If you do not want to sell for the price you are offered, you can ask the buyer if they are willing to make a higher offer, wait for another buyer, or make a ‘counter offer’ saying the minimum price you are prepared to accept.
You can negotiate offers from more than one buyer, but you have to inform both buyers if you decide to do this. The buyers may be willing to compete for the property but there is also risk that one or more of them may pull out.
Some estate agents ask buyers to pay an earnest deposit of between two to three per cent of the offered sum when they make an offer and signs a Letter Of Offer to Purchase or an Agreement To Purchase. The estate agent normally keeps the earnest deposit in their clients account as stakeholders from the date the offer is made until the execution of the Sale & Purchase Agreement.
Step 7: Drafting of the Sale & Purchase Agreement
After accepting an offer, you (or your estate agent) will need to give your solicitor certain information to begin the legal preparation for the sale. You will need to confirm:
- Your Details
- Your Property Details
- The buyer’s name, address and phone number
- Contact details for the buyer’s solicitor
- The price agreed
- A list of any fixtures and fittings included in the price
- And any other conditions of the sale
Step 8: Execution of the Sale & Purchase Agreement
When the buyer executes the Sale & Purchase Agreement, the buyer will pay the balance of the first 10 per cent of the Purchase Price (less the earnest deposit). The documents will then be forwarded to you for execution and then stamped. Based on the standard terms in the Sale & Purchase Agreement, the balance 90 per cent will be payable to you within three months from the date of the Sale & Purchase Agreement or three months from the date the Sale & Purchase Agreement becomes unconditional.
The above is a quick summary of the selling process. There are a lot of other matters and details to each of the steps that you need to be aware of which we will cover in future articles.
Chan Ai Cheng
General Manager, S. K. Brothers Realty (M) Sdn Bhd Registered Estate Agent with the Board of Valuers, Appraisers and Estate Agents Malaysia (LPPEH), Member of the Institution of Surveyors Malaysia (ISM), and the Malaysian Institute of Estate Agents (MIEA), Registered Financial Consultant with the International Association of Registered Financial Consultants (IARFC), For any feedback on this article, please email firstname.lastname@example.org