Why did GTSA develop the vendeRAPIDO® selling process for selling real estate in South America?
This post is also available in: Spanish
There are two reasons. To speed up the selling time and Maximize the Value
Current Market Realities
South American real estate markets are in the main lightly regulated and highly informal. What this means for vendors is they are at a strong disadvantage when they come to selling a property within a reasonable time frame. Traditional times of sale are measured in months and years. Consequently transaction costs are among the highest in the world. With the globalization of real estate GTSA saw an opportunity to add value to our current property consulting services by offering vendors an option for selling quicker and for more money.
There are have been up to now only two options when selling real estate.
With a list price
Or without a price
Selling with a List Price: Selling with a list price is appropriate when there is ample market evidence to give you enough information to price within 5% of what recent sales of similar type properties that have sold within the past few weeks. The real estate market is dynamic moving up and down over weeks and months and over pricing will normally lead to a stale property that will be undersold after months or years in the market. Traditionally due to a informal market “middle men” called “independent brokers “ would scalp other brokers listings adding a margin for themselves on the top. This is way you see the same property listed at different prices on different websites. The other characteristic of this market is “professionals” ie Notary’s or Employees who know the vendor and often try to act as informal brokers themselves despite the fact they have had no sales training or experience. This usually results in a big mess.
Selling without a List Price: Selling without a price normally takes the form of an Auction or Tender. In a sophisticated real estate markets where there is price transparency for example Sydney, New York, Singapore the majority of properties are sold in a 3 to 4 weeks using these methods giving property owners a liquid market to buy and sell in. However this is not the case here where considerable mistrust lack of bridging finance and illiquid market conditions caused by government banking controls etc etc all make these option problematic except in certain locations and situations. Ie Chile and Uruguay.
The Hybrid option: vendeRAPIDO® Developed by South Americans for South America
It is because of the above market realities that vendeRAPIDO® was developed to assist those vendors who were serious about selling their property. It is not suitable for speculators of which there are many or vendors who are not committed to selling. A vendor using vendeRAPIDO® to sell is very serious .
vendeRAPIDO® is a hybrid born from the Tender /Auction process to suit local selling realities.
It has the same advantages as an Auction or Tender but none of the downside when the market is illiquid.
The benefits of selling using vendeRAPIDO®
A strong sense of Urgency: The vendeRAPIDO® deadline sets a finite selling period and creates a sense of urgency among buyers.
Buyer Competition: A vendeRAPIDO® creates the conditions for buyer competition – which can lead to a premium price being paid.
Confidentiality: The result of a vendeRAPIDO® is private and confidential to the vendor.
Time to Consider: You have a fixed period in which to decide which offer to negotiate with.
This can be important if there are a number of parties involved in the decision.
Flexibility: A vendeRAPIDO® allows you, the seller, to be more flexible with the terms and conditions of the sale e.g. You choose the possession date, terms of payment, length of settlement.
Level Playing Field: Because the property cannot be sold before the closing date, all interested parties are competing on a level playing field.
Tracking Interest: All salespeople can register potential buyers for your property via a centralized database, so we can track interest.
No Price Limitations: By marketing without a price you are never limited by an asking price that is too high or too low, so you can attract a wider range of buyers. However where has been in the market before and there is considerable misinformation about it it is best to use a base price.
Feedback: Your GTSA salesperson will provide regular market feedback to assist you in establishing the selling range of your property.
I trust this is clear but if you have any questions please ask.
Geoffrey W W McRae – CEO and Marketing Director
Gateway to South America – Argentina – Brazil – Chile – Paraguay – Peru – Uruguay
E: geoffrey @ gatewaytosouthamerica.com
Awarded Real Estate Specialist Firm of the Year in by the Corporate INTL 2016 Global Awards