Are you selling a property? Does it remain unsold despite all your efforts?
Selling property, especially to businessmen and companies, entails more than just making a sales pitch. Seasoned brokers are fully aware that they need to have an excellent understanding of the buying decision process to be able sell a property.
Why buy?
Developers are constantly looking for properties to own, develop and construct different projects—residential, commercial, retail, hospitality and logistics projects.
Knowing the project type they wish to undertake allows sellers to better appreciate whether their properties would be shortlisted by potential buyers.
Investors, on the other hand, are after the price, value for money and return on investment. They are interested in regular cash flow and profit. Thus, they are constantly on the lookout for properties that are attractive to their target clientele and or tenants, and more importantly, will appreciate in value and price over time.
A proper recognition of the buyers’ intent, whether it be for a need or an opportunity, allows the sellers and their brokers/agents to tailor-fit their sales pitches so that they have better chances to convince buyers to acquire their properties.
Multiple roles buyers play
As highlighted by Kotler, Haider and Rein in their book titled “Marketing Places,” marketers distinguish six roles that influence the buying process namely, initiator, influencer, decision- maker, approver, buyer and user.
While it is possible to have one person assume all these roles, such as a young and budding entrepreneur, established companies have different persons performing these roles.
As an example, both the business development officer and property acquisition officer team up to identify and assess several properties for a residential project (role: initiator). Their business development manager narrows the pre-selected properties further to match the competitive market they are in, in order to ensure the feasibility of their planned project (role: influencer). The preferred site is subsequently endorsed to their superior who determines to support the proposed purchase (role: decision-maker). In most property companies, and unless delegated to the president, the board of directors is normally vested with the mandate to approve the property acquisition (role: approver). Once a favorable decision is secured, the property acquisition officer executes the given authority to buy the property (role: buyer). Thereafter, the department-in-charge of the project can start the detailed design and construction of the residential project (role: user).
Given the huge amount required to buy a property, it is not surprising that the process can be more complicated. Nevertheless, knowing who your buyer is and what role he plays in the above buying process, provide the seller with a better grasp of what and how to do it to get the property sold.
Sources of information
A host of attributes and factors needs to be taken into account by buyers. These include location, size and parcel configuration, price, payment terms and conditions, seller responsiveness to request, counter-offers, etc. However, with sizeable inventories and multiple options available in the market, how can buyers be guided on which property to pursue or set aside?
Buyers normally secure information from four possible sources: personal, commercial, public and experiential, Kotler, et al. noted. Relatives, friends and acquaintances are examples of personal sources of priceless information.
Many buyers also seek the assistance of real estate brokers and agents to help them scour the market as these commercial sources have extensive networks and usually provide more in-depth information, although they may need to be compensated.
In the present digital world, public sources are likewise abundantly available. Online information from social media, sponsored advertisement, public and private selling sites are conveniently and freely accessible.
Most important is the need to visit these properties to validate the information provided. Walk around the site, check the terrain, locate the extent of the boundaries, and physically examine the property features and adjoining properties. The experience of personally checking the property is invaluable in the buying process.
Caveat
Despite the rated findings and excellent recommendations, there is still a slim chance that the planned acquisitions could fall apart. It may be due to a belated finding, negative feedback, a catastrophic event like the COVID-19 pandemic, or problems/risks that could not be addressed or managed on time for the closing.
Reference used include “Marketing Places: attracting investment, industry and tourism to cities, states, and nations” by Philip Kotler, Donald Haider and Irving Rein. New York: The Free Press, 1993.
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Henry L. Yap is an architect, environmental planner, real estate practitioner, former senior lecturer and was recently named one of the Undersecretaries of the Department of Human Settlements and Urban Development.