We caught up with Matthew Dabell, Managing Director at Aspire Estate Agents. Matthew has over 30 years’ experience in the property industry and has dealt with a number of developers throughout his time. He is well placed to comment on how a developer can prepare for a successful sale. Here are his three top tips:
What is the purpose of your purchase?
This might sound like a silly question, but you’d be surprised how many people don’t start their projects with a strong vision. Many people change their minds as to what the end result is going to be during the process and that effects the quality of your final product.
Furthermore, once you’ve decided what your purpose is you need to consider the surrounding area. Is the product you are developing suitable for the location? You may have found a great site, but you always need to go back to purpose and whether this matches demand in the local area. It’s so simple but you shouldn’t force something that doesn’t look right, chances are, it probably won’t be.
What’s your back-up plan?
In addition to making sure the numbers stack up at the start, it’s important to be realistic about the potential results of your project. You might build the most beautiful property which at the time of embarking on your project, you’re certain will sell but you have to understand that there may be a scenario in which you simply can’t get out of the cycle. The rental values of the project are crucial along with the feasibility of a property being filled. For example, if you build a £1 million home, you find you can’t sell it, what’s the feasibility of rental?
Furthermore, you need to calculate the absolute worst-case scenario. If letting out the property is a fall-back option, what is the minimum that the property could be rented for to cover your cost, is this a feasible sum? On a similar note you need to make sure you know what your refinance options at the end of your project are, if you can’t get out of the cycle, will your current lender help you with refinancing or will you need to go elsewhere? These are all important questions which every developer needs to be honest in facing as early as possible.
Build your pre-launch strategy
This is crucial. Sometimes, a developer can be so wrapped up in their own project that they take for granted that their potential customers actually know nothing about it. Firstly, it’s important to consider your timings, when will your property complete and go to market? Is this realistic?
Naturally, it’s important to build a buffer in for delays. If your project is due to complete in March, then great, it’s prime time for the sales market, but if it is ready in July, then perhaps you are better off waiting to market in September or host a pre-launch event before the property is complete. It may feel like your property is vacant for longer but on the whole, it’s better to wait and make a big splash when everyone is watching.
Additionally, it is important to keep your finger on the pulse. Take some time to look at what your competitors are doing, how are they marketing projects and what furnishings work for them. Get your market research done and you’ll be confident that you’re in the best position to sell.