Was it overpriced? Nope.
What did you think it would go for? We appraised it 12 months ago for $1.4 million to $1.5 million. We reappraised it in March this year at $1.25 million to $1.35 million. [Records show it sold for $1,425,000 in February 2017.]
What was surprising about it?
Magic won’t happen at the moment. That one lucky buyer probably isn’t just there. You need to be realistic with yourself and the market.
What was surprising was the high percentage of people interested in it that viewed it. The numbers were low but the engagement was high. The buyers who were coming were genuine people.
Prior to listing the property, we researched inner-city apartments for sale and everything in the sold section. The properties that seemed to be marketed with no price guide were remaining for sale.
When we were listing the property we recognized that the demand for inner-city apartments was reducing and we also noticed that prices had come back from their peaks of a few years ago. We also know that a lot of people who purchased off the plan paid big prices for their property.
The sale process required a clear understanding by the vendor of how much value the property had lost since its off-the-plan purchase five years earlier.
The vendor had bought it off the plan five years ago. In our discussions with our vendor we had to make it very clear that it wasn’t a profit-making scenario to sell the property.
We have a discussion with our vendors to try to distance themselves from the process.
You have to face reality on pricing, or it’s a collector’s item.
— Agent Duncan Grady
People will happily buy a Mercedes for $200,000, sell it four years later for $70,000 and not bat an eyelid. But if they lose $1 on their property they think it’s a national catastrophe. They feel that they’ve failed. We have this discussion scores of times every month.
But leaving it on the market at an unrealistic price level is not a strategy. We realized that we had to go into marketing with a realistic price guide, which we did.
People engaged with it. At the end of the day, we had three parties making offers. The strongest buyer secured the property.
It’s a really good quality offering. It still required every bit of agency effort to get the result, which shows the state of the market.
But with a clear price indication, it sold: In the end, there were three potential buyers making offers on the two-bedroom apartment.
It was fully styled. We were showing on Sundays, doing night-time inspections. We had one open inspection from 5.30pm to 6pm and we waited till 7pm because one buyer was running late. We really went every mile for our vendor to get our result.
You have to face reality on pricing, or it’s a collector’s item. We need to recognize that borrowing power has reduced substantially with interest rate increases, which means prices have changed. And if agents and vendors are not aware of this they will do so at their peril.
Don’t hide a price to think something will happen.
Do you reckon we’ll see another result like this: a) next week b) next year c) next cycle d) never?
b) Next year. In these inner-city buildings most people have paid large amounts of money for them and are not wanting to realize a loss. Realistically, most of those will take a year to come to terms with new values, or they will hold off and then vendors, if they really want to sell, they will have to realize the current values.