The sale of “Casale Bellevue”: how important was the identification of the right market value and the prior due diligence of the property?
The point of view of Antonio Anile of Nama Real Estate, partner of the Great Estate Group.
The former owners of “Casale Bellevue” contacted Great Estate directly in 2018, as they wanted to entrust themselves for the sale of their property to an organization specialized in the sale of prestigious properties.
They live in Milan 2, and for about twenty years “Casale Bellevue” has been their summer home, where they have spent unforgettable holidays in the company of their children and grandchildren.
The strength of this property is undoubtedly its location.
I believe that both geographically and in terms of location, “Casale Bellevue” has no equals.
It is located on the Etruscan Coast, less than an hour from Pisa International Airport, exactly halfway between San Vincenzo and the spa town of Venturina. The nearest beach, located on the coastal stretch of Parco di Rimigliano in San Vincenzo, is just three kilometres away.
The sellers, before approaching our group, tried to sell their farmhouse both privately and through local agencies, but without success.
This experience made them realize that it was time to change their sales strategy, so they contacted us.
At a very early stage, they decided to commission both our agency and another agency in London to sell their property.
However, they soon realized that this other agency had not been able to identify any useful contact for the sale of their property.
Subsequently, precisely for this reason, they decided to share an exclusive assignment for sale with us.
The first step in the “Great Estate Method” is to prepare a written, detailed market estimate using our software The Best Price.
The value released by our tool fell short of the owners’ expectations and, as is often the case, the owners initially decided to start from a much higher asking price, around 30% higher than the estimated value.
Personally, I think that the behavior of all the other agencies with which they had dealings, including the London agency, certainly influenced this choice.
In particular, I am referring to the fact that none of the other agencies had prepared and submitted materially to the sellers a written and detailed estimate of the property. I believe that this created some uncertainty in them about the fair market value of their house.
Starting with the assignment in 2018, after only two months of advertising the property on our international channels, we received an initial, concrete interest from a couple of Swiss buyers who submitted a purchase proposal.
The offer was slightly below our estimate (about 5% less), but obviously far from the sellers’ asking price. That is why they decided to reject it.
In essence, their thinking was:
“if you were so good at the first appointment that you brought us this proposal, with a little more patience we can achieve a better price“.
As is often the case, in the two years after receiving the first proposal, even after showing the property to many other clients, an opportunity like the one with the first Swiss clients did not arise again.
For this reason, the sellers decided to intervene twice on the advertising asking price, gradually adjusting it to the estimated value.
And so, when the Italian couple from Florence decided to buy “Casale Bellevue” last January, the whole of the previous situation convinced the sellers to accept an offer about 10% lower than the one presented almost three years earlier by the Swiss clients … Just think what 10% of an amount of just over a million euros might represent …
Our professionalism, which is one of the hallmarks of the Great Estate Group, always drives us to provide valuable advice to our selling clients:
place the property on the market immediately with an asking price that is as close as possible to its market value because, statistically, the best and most “remunerative” offers come in the first period of the sale.
As far as the negotiation is concerned, if you read my previous article on buyer management, you will have understood that the negotiation was concluded quite quickly, within about a week.
THIS FOR A REASON.
The buyer, on the advice of his lawyer, asked us for a report on the conformity of the property with the urban plan.
Another very important element of our working methodology is to follow scrupulously the whole preparatory phase of putting a property up for sale.
Already after the assignment, with the help of a technician, we had prepared a technical report on “Casale Bellevue” which led to the drafting of the due diligence.
When the buyers expressed their willingness to make the proposal, we sent them the report on the same day as the visit, at the end of the visit.
All this made it possible to conclude the preliminary contract in a few days with the notary who, in front of the parties, complimented us as an agency for having carried out the necessary checks even before the preliminary contract was concluded.
Among other things, the purchaser, who has decided to undertake renovation work on the house, has already been able to start the procedures for obtaining the 110% Superbonus provided for by the “Decreto Rilancio”: this is precisely because he is already in possession of the due diligence.
In fact, a promissory purchaser, as such by means of a preliminary sale agreement signed with the other party and duly registered, has the possibility to start the procedures to obtain the Superbonus.
In this way, he can use the time between the signing of the preliminary contract and that of the deed of sale to anticipate the time needed to carry out the energy efficiency works.
Even looking at this aspect, you will understand how decisive it is to draw up and have available the prior due diligence of a property.