By KATRINA CREER
There is no doubt some homes are easier to sell than others. And as tempting as it may be to highlight the pros and forget about the cons, it can land real estate agents in serious trouble.
Any information that may influence a decision to buy, sell, rent, or impact a property’s market value needs to be disclosed to potential buyers. Known as material facts, agents must be, by law, upfront about such issues.
Whilst most problems are obvious, some are harder to detect. Before listing a home on the market, agents need to speak to the sellers about market-sensitive matters. They must also do their due diligence. According to NSW Fair Trading, generally an agent is still liable for misrepresentation whether or not the material fact was to their knowledge.
So, what’s the best way to proceed with a challenging property and get that sold sticker up on its signboard?
What makes a property difficult to sell?
Homes with problems, such as being on a busy road or with a bad easement, are likely to be harder to sell outside of a buoyant market.
Craig Marshall from Marshall Chan Yahl believes such defects need to be priced competitively although owners – especially those who have lived at the address long-term - may not always agree.
“I once took a vendor out to the back of his property purposefully as there had been a lot of buyers through it, but they had been turned off by the terrible road noise,” said Mr Marshall, a member of the REINSW’s Residential Sales Chapter Committee.
“When I told him there was a problem, he looked at me and said ‘What road noise?’ just as a truck was going past - he just couldn’t hear it.”
Some problems, such as poor natural light, may be fixed by adding a skylight, a fresh coat of paint or new window coverings. Other issues may have no solution but to drop the price.
“You want to do the best job you can do to sell the property and if it is a difficult property to sell then you need to spend a lot of time with buyers,” Mr Marshall said.
“This isn’t always done by agents, they tend to show the property, pack up and leave but investing more time in difficult properties can help to sell it.”
"You want to do the best job you can do to sell the property and if it is a difficult property to sell then you need to spend a lot of time with buyers."
Craig Marshall - Managing Director, Marshall Chan Yahl
Honesty pays off with buyers
Simone Luxford, a member of the REINSW’s Buyers Agents Chapter Committee, often dismisses properties with a tunnel underneath them or which are located on flight paths.
The Director of Essential Property Wealth also steers clear of steep blocks on the lower side of a street due to possible drainage and access issues. However, sometimes buyers are willing to make a trade-off and may even prefer such a property because it is private or comes with a great view.
“For us, it is about making sure that we give buyers the information and the education so they can make that decision and they are made aware of the potential pitfalls of the not-so-straight-forward properties,” she said.
When considering a property for a client, Ms Luxford always asks if it has any problems prior to inspection. Fortunately, most agents are forthcoming about issues.
“Nine times out of ten you are going to find out anyway and it just reflects badly on them if they don’t disclose information,” she said.
“It is refreshing knowing what the problem is before you walk through the door and if it ticks a lot of boxes, then we may still look at it.”
Be upfront and informative
Whether it is an outlook over a cemetery, a bad strata report or even the scene of a grisly crime, most properties do eventually sell.
REINSW member Ewan Morton agrees that it comes down to price and compromise from both the vendor and buyer. He recommends revealing any issue as quickly as possible and framing it in a way so that the potential purchaser has time to process it.
With a deceased estate, the most common question from buyers is whether the vendor passed away in the property.
“This is a material fact but from a practical point of view, you need to tell them that because if they find out through someone else and not you as the agent, then you will lose any trust,” Mr Morton said.
“If the house meets their need and is within their budget, then they will often get over it.”
One of the most difficult properties he has had to sell was a unit in a high-rise building that had been the scene of a murder. But it wasn’t the horrible history that made the sale problematic.
“The biggest issue was that people came thinking that the vendor would sell it for cheap - some people don’t cover themselves in glory looking for the opportunity,” Mr Morton said.