Stefano Petri is going to tell us about the recent sale of “Il Re Della Valle” – a further confirmation of our Group’s strength: the fundamental importance of a property due diligence and of an objective property estimate.
The meeting with the vendors and our cooperation
The vendors contacted Great Estate in September 2017: they read an interview with our Group on Ville&Casali magazine.
Their property was already on the market: they were advertising it privately and with a very important requested price.
We immediately signed an exclusive assignment for sale. As usual, in case of this contract, a specific marketing plan was included too. I would like to underline that, in the beginning, the clients contacted also other agencies but, in the end, they chose us.
From the very first moment, we created a mutual relationship of trust among each other.
The property estimate
As you can see from this graphic (storico valutazioni), I personally did an evaluation of the farmhouse in October 2017. Our The Best Price system highlighted a € 950.000 value.
I suggested the clients enter the property on the market with a price of less than a million euros but, as often happens, they want to test the market before doing so. For this reason, we place it at € 1.350.000.
As you can see from this other graphic (storico prezzi), this price changed in:
1.250.000 – April 2018;
1.150.000 – August 2018;
Finally, in February 2019, we reached the last requested price: € 980.000, the same I proposed the vendors in 2017.
Which are the reasons for all these price changes? Basically, the market “non-response”, the lack of interest toward the property and the consequent realization of the vendors: the price they were asking was not the right one.
At the end of the first year, having not reached the results hoped, the vendors asked to turn the exclusive assignment for sale into a free one. We accepted it: in this way, we hoped to make them understand that the improvements needed should have been searched into the property asking price and not into the agency.
So, at the end of 2018, “Il Re Della Valle” was given to other two international agencies present in Italy. However, this change had no result either.
For this reason, the vendors had finally understood that they should have changed the price.
In February 2019 (see storico prezzi), we agreed for € 980.000, but the property should have been advertised under POA. This choice gave no results: we received many clients because they were curious about it, but a few were the ones who really asked information about the property. Indeed, “POA” always makes a client “be suspicious”.
The decisive step was taken in April 2019: we advertised the property at € 980.000. From that moment, the interest in the property has constantly increased. Indeed, in June, we brought there THAT client, the one who would have then become the new owner of this amazing home.
By verifying the historic sequence of the property estimates (see storico valutazioni), you will be able to understand that the fact of having positioned the farmhouse with a wrong price for two years brought to a 10-15% decreasing of its value. This means about a € 100.000/150.000 decrease.
This analysis is useful to understand the importance of advertising a property at a fair price. Indeed, it is now clear that, since 2010 to date, the real estate values are suffering of a continuous decrease because of the reasons explained in my previous articles. I suggest you read: ARE THE REAL ESTATE VALUES FOR SECOND HOMES IN ITALY GROWING OR DECLINING?
Once again, this confirms as the attention that, as a Group, we addressed to the creation of an objective property estimate and the aptitude to persuade of the vendors are two fundamental elements for the reaching of the best goal possible.
From the following graphic it is clear that, in terms of views, we obtained the best results from March 2019 to the moment of the sale. In those months, the average of the monthly-views was about 900-1.000 – against the 300 of the previous months.
This means that the adjustment of the requested price of about 30% (i.e. from € 1.350.000 to € 980.000) brought to a views-increasing of more than 300%, so to the consequent property sale. For this reason, it becomes even more important to understand how a property fair market position may transform a failure into a great result.
The market is present and answers, but only and exclusively when you are asking it a fair price for your property.
Regarding “Il Re Della Valle”, there is also another analysis to do. I would like to underline you a “limit”: the fact of remaining close to the requested values – in this case, from € 980.000 to € 1.020.000 – brings to strong consequences that need of a careful reflection.
Positioning the property at € 980.000 may represent a potential “answer” for all those clients who want to invest that value. On the contrary, if the same property would have been positioned at € 1.020.000, it would have become “invisible”, losing so many possibilities. Moreover, according to this second case, “being” a possibility among the researches over the million euros would probably bring the property to position itself near or “together” other competitors that, in the 99% of the cases, would be better than our home.
Instead, by positioning ourselves under one million euros, our competitors would probably result “less interesting than” us… just € 40.000 – which means 4% of the property total value – brings to an enormous visibility difference.
My conclusions
I would like to conclude by thanking the ex-owners of “Il Re Della Valle”: we have always had a confront. We have also argued, but we have never lost our mutual respect. I think also that their jobs contributed to the share of a common approach.
Moreover, our professionalism and skills have been very important in their decisional path. Many times, the vendors think that our property estimates are aimed to “sell a property quickly or even to sell their property out”.
I claim that our properties evaluations are made with just one aim: SELL YOUR PROPERTY AT THE BEST PRICE POSSIBILE, BEING SO ABLE NOT TO SELL IT OUT.
With the months passing, communicating the market a constant decrease in your home value brings to an impairment of the property commercial visibility. Currently, the clients who are willing to purchase a house are very careful about the market. Decreasing a price makes them WAIT FOR THE NEXT ONE or, in the best hypothesis, PRESENTING A LOW-BALLING OFFER.
Once again, this negotiation taught us some fundamental aspects that I am going to sum you up:
- The importance of an objective property estimate and of its advertising: its requested value should not be higher than the 5-10% of the estimate. This is aimed to sell a property at its best price possible.
- The importance of a property due diligence. Indeed, in this case too, this technical report would have allowed us to discover some urbanistic-cadastral situations in advance.
- The strength of our Group that, once again, reached the objective sale. This goal has been achieved by Great Estate Immobiliare and not by the other two well-known international agencies working on the field. This is because – in the whole Umbria region – our Group is becoming, day by day, a great referring point in terms of international visibility, quantity and quality of the buyers and of the professionals working in the area.
STEFANO PETRI
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