Hi,
I have a property in NSW that is in R4 zoning (High Density Residential). I am now looking to sell the property. Thinking about how to maximise the return, I was wondering whether anybody on these forums had ever sold their property to property developers.
How did you find these developers?
What were some of the things you learnt or wish you knew whilst doing this?
Greatly appreciate any help or insight that can be shared with me :)
Thank you!
M
You advertise as normal. You do nothing differently.
If your selling price is appealing, and your property is the right combination of:
a. shit property that can be demolished
b. high land value
c. location
then they will make an offer.
You won't even know if they do make an offer. They'll likely use a proxy or nomination. They want to buy cheap. If they out that they are developers you'd likely want more, right? :)
So what property have you sold, you seem to know about everything?
Developers also want land with no slope, in a regular rectangular shape.
Having an R4 is completely useless if all the other ducks don't line up. Just some are block size and shape, area, selling price, market conditions, council etc. Sooooo many other factors. As said above if the opportunity was fantastic the developer would probably find you and if they haven't already just list it for sale and see what you get.
Welp full disclosure, I work for a property developer, but I do more "making things work" and less planning and negotiations etc;
But I guess I can help with some general info.
Usually they will want to buy a bunch of properties because if they are next to each other, they are likely able to join and make a bigger plot, helping stuff like size build-able, regulations etc.
Depending on how high value of a property yours is, They may be more or less willing to be flexible on price.
Some pointers for value would be the likes of
1) How well perceived the area is
2) Demand for that area (usually areas with a lot of Chinese people tend to be more expensive it seems)
3) Proximity to the CBD(city), Train station, Shopping Centres etc. (closer the better)
They also tend to have contact with real estate agents to organise deals.
Generally the real estate agent will try and estimate what you are willing to drop the price to and what the buyer will go up to. Since they usually make a commission, They usually have more incentive to help you, the seller. (Though still tread lightly).
I don't work a lot in the realm of negotiations or have much skill in it so I cant give much tips there but hope this helped at least a bit :)
You can get a consultant to look at the development potential for you so you're in a position to know what the development upside is. It can be really surprising - there are a lot of factors involved.
Talk to your immediate neighbours and sell together.
Every person i know who sold to a developer, the developer approached them and offered about 10%-20% over value, the stragglers in the buyout of the area, usually of a block got 2-3x the value of their property.
However i also know someone who wanted way too much (about 4-5x), and they ended up losing out on millions, as the developer passed on their corner lot, and the block of units got built around them, now their property is worth about half of what it used to be normally without the developers offer premium.
If you want a higher return then you need to make it more attractive to developers by combining the sale with other neighbours. Otherwise you sell to the highest bidder in a normal sale.
See if you can approach neighbours to discuss a bulk sale. Alternatively, if a neighbour is selling, approach their agent and tel them you are interested in selling as well.
By and large developers come and find you, not the other way around. Talk to all your local agents and the larger commercial ones (JJL, Colliers, etc) as they would tend to be the ones likely to be contacted by interested developers.