Anyone who has bought or sold real estate in Australia in recent times knows the pains associated with the whole process. That process will most likely include:
- Deciding on the next move.
- Assessing potential sale return.
- Applying for finance.
- Choosing an agent.
- Deciding on a sale method.
- Setting the sale price.
- Finding a solicitor.
- Preparing the home for sale.
- Committing to advertising.
- Arranging required pre-sale documents.
- Cooperating and preparing for home open days/hours.
- Facilitating home inspections.
- Negotiating on offers.
- Being on the lookout for the next property to which you will move.
- Arranging removal of furniture and other personal items once sold.
And these are just the high-level decisions to be made with many finer details involved for each!
As a result, the process rarely runs smoothly, with the seller, the buyer, and the agent usually suffering frustrations at various times, and all the while the costs of the sale mount. What if there was a better way?
Agents are always on the lookout for specific properties which align with their own buyer client’s requirements. I am sure many of you will have received pamphlets in your letter box espousing an agent’s sales success in your area, and that they have a ready, willing, and able buyer wanting your home. It would be great if it was that easy, but it rarely is. Finding the right home which is not listed for sale and which has a willing seller, at the right price, is a hit and miss game with many more misses than hits.
In Australia there are around 500,000 homes sold per year out of a total of some 11 million. If there was a way to better target the 10.5 million unsold, and I would venture to say unlisted, properties, then perhaps the off-market sales opportunities would be substantially greater. That being the case, there would be considerable cost and time savings by all involved, ultimately leading to enhanced satisfaction. Even getting “standard” listings is difficult, with agents paying handsomely to secure listings from various sources. With an enhanced capability to directly source willing sellers and connect them with willing buyers, the benefits to agents is significant.
Perhaps some might not like such a growth in off-market sales not the least of whom would be real estate listing sites, Auctioneers, “prepare-for-sale” consultants/tradespeople, and buyer agents, but they comprise a small part of the total market.
The reasons for the dearth of off-market sales is threefold. Firstly, it is difficult for people to readily know what buyers will pay for their property without actually listing it, with all the associated logistics and costs. Secondly, buyers don’t know who a willing seller might be, outside the currently listed properties. Lastly, there is a lack of risk, lifestyle, and historical data for all properties whereby buyers, and agents, could better profile their ideal home and target potential sellers. This is the Nirvana for buyer, seller, and agents alike.
Companies such as Residz and other PropTech innovators understand this compelling value proposition and are responding accordingly. Residz has profiled every property in Australia with a wide range of historical, risk, and lifestyle data by which buyers can readily align a property to their preferred needs. Further, in the absence of a range of overhead costs that would otherwise be applicable, there is a far greater chance that buyers and sellers price expectations would align. Of course, either the seller or the buyer might want to engage an agent for all or part of the process, but there are still compelling savings.
As we work our way through the impacts, both short-term and long-term, of COVID-19 on real estate preferences, as discussed here, there will be much more focus on lifestyle and risk data when undertaking property research. This can only lead to greater market efficiency overall.