Expert Eye

Some strategies to help you sell your residential property quickly

So you want to sell your house. You know that the person who likes your house most is more likely to pay you what you want. So how do you get somebody to really like your house? You need to carry out some “staging” and the following tips might help:

First impressions count. How do you make sure that as a prospective buyer approaches your front door the right impression is made immediately? Brighten up the entrance by applying a fresh coat of paint, repolishing the front door, cleaning and polishing the door knocker, handle and lock hardware, cleaning pathways, and placing potted plants and shrubbery to make your guests feel welcome and you confident in showing off your house.

Tidy up. We all have our favourite belongings, many of which we don’t even use. Get rid of them. Be ruthless in your approach. Stuff takes up space, makes living areas look smaller and disorganised, and detracts from the attractiveness of your house. If you don’t need it, give it away, sell it or just trash it. In this case, less is definitely more.

Try to create space, even if it is an illusion. One way to achieve this is to move your furniture away from the walls. Couches clinging to walls simply don’t work. Float furniture away from walls; reposition it into sociable groupings.

Utilise unused spaces. Just because you may not use a space doesn’t mean that somebody else may not value it. If you have a spare room which is empty, turn it into an exercise room, a family room, a rumpus room, or a quaint library or reading room. Give the space a purpose; let the sunshine in.

Use as much natural light as possible. Allowing natural light to shine into a room makes a closed-in space seem larger. Where you cannot use natural light, try to make your home look warm and welcoming by trying some lighting design. To remedy bad lighting and make your home more inviting, increase the wattage in your lamps and fixtures. Aim for a total of 100 watts for every 50 square feet. Then install dimmers so you can vary light levels according to your mood and the time of day.

Don’t depend on just one or two light fixtures per room. Try to construct a combination of overhead, floor, table and accent lighting to create an overall pleasant ambience and make the room interesting.

Get painting. Painting is the cheapest and easiest way to give your home a new look. Don’t be scared to experiment as you can always paint again if you don’t like the colour. You could also try painting an accent wall to draw attention to a lovely set of windows. If you have built-in bookcases or niches, experiment with painting the insides a colour that will make them stand out. Don’t be afraid of black paint. The key, as always, is moderation. Use black as an accent in picture frames, lamp shades, accessories and small pieces of furniture.

Make art a feature of your house, not an afterthought. If your home’s like most, art is hung in a high line circling each room. That’s a big mistake. Vary the pattern and grouping by hanging a row of art diagonally, with each piece staggered a bit higher or lower than the next; triangularly, with one picture above, one below, and one beside; in a vertical line (perfect for accentuating a high ceiling).

Bring your garden inside. Well-staged homes are almost always graced with bountiful fresh flowers and interesting floral displays. Take clippings of branches or twigs and put them in a large vase in the corner of a room to add height. Adorn dead space with greenery or interesting and intriguing arrangements. Make each piece different and unique in its form.

Finally, get creative.  It’s your responsibility to make people fall in love with your home. Do whatever it takes and you will be rewarded.

Managing through cycles

The fact that the property industry is notoriously cyclical is widely known yet viewed differently. For some, cycles represent a form of volatility that enables the shorter-term investor to profit from market fluctuations as they occur. In extreme circumstances, this would be considered to be speculating and I know as many people who have lost money speculating as those who have gained.

Yet investors with a clear strategy and long-term plan simply accept, fore-see and plan for cycles in the industry. They look for longer-term sustainable growth rather than take additional risk by trying to accumulate wealth through taking advantage of shorter term spikes or dips. They are true managers of their property portfolios and have a much greater chance to succeed.

Investing in property has a very simple purpose: to create wealth over the long term. However, your property investment portfolio needs to be nurtured, maintained and managed to ensure its wealth-creating potential and capabilities are achieved as it rides the inevitable cycles that occur in the industry. Adopting a short-term vision and reacting unreasonably to inevitable industry slowdowns will lead to underperformance in the longer term.

Consider one of my clients. As the owner of a portfolio of apartments purchased early 2011, the past four years have been extremely lucrative for him. He asked whether to sell his property assets as the market had slowed. Rather than make a hasty decision that might be regrettable, I constructed a recommendation for his consideration.

An easy decision would be to sell his entire portfolio for a substantial profit, but the question remained: where should his newly gained wealth be invested? There was no answer as there was no plan.

We found that by retaining his portfolio, my client would continue to receive an average of 6.8% nett rental returns per annum on the adjusted value of his properties over the next five years. Notwithstanding the recent cooling of the market, we estimated that he could expect a capital growth of at least 6% per annum over the next five years for an estimated nett total return of 12% per annum.

The review included careful analysis of current maintenance requirements, future capital works, market factors, regulatory developments, industry forecasts and trends, alternative opportunities, risk factors, and relevant future events.

When I asked my client what alternative investment could provide the same return without taking on greater or excessive levels of risk or incurring new investment transaction costs, none could be identified.

The example of my client clearly illustrates that property portfolios require careful management. We all know the market has cooled, but this is hardly a reason to make rash decisions without doing proper analysis.

Wherever you look around the globe, yield and total returns are getting harder to find and the value of established property portfolios with good occupancy levels and projected tenant retention are increasing in comparative value all the time. The investors who hold and nurture their existing property asset portfolios will do very well over the next five years, particularly those who have diversified their holdings to include some of the more affordable asset types.

Not everybody is comfortable with managing a property portfolio. However, there is expertise available. You should consider engaging a good property manager who will ensure that you maximise returns.

Proper management is essential and you need to ensure your portfolio is in good hands.

Of property appraisals and securing home loans

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Estimating value of property considered biggest eligibility criterion for home financing

Parallel to the growth of the UAE’s realty sector is the growth of its home finance sector. Home financing is a crucial part of the realty market since property appraisal is the biggest eligibility criterion for it.

The financier, which is either a bank or a money lender, establishes the security value of the house to be purchased for the buyer to secure a home loan and for the property to serve as mortgage collateral. The lender’s objective is to obtain an estimated selling price of the house in the market in case an immediate sale deed takes place, like repossession.

The lender can assess the value of the property in two different ways. The financier can either send a surveyor to physically inspect the property, or use modern methods like online evaluation.

Online valuation is carried out by utilizing online data such as land registry, information on comparable properties in the area, house price indices and Google maps to arrive at a probable market value. Along with online data, a visual inspection of the property may also be performed. Online assessments work for simple residential properties only. However, for quantitative residential purchases or commercial property, physical assessment is the best approach.

The physical assessment of a house includes recording details like the number and type of rooms, the absence and presence of fixture and fittings, and changes required, among others. In addition, the location of the house, its accessibility to public transport, the availability of parking space or garage facilities, the condition or structure of the building or villa, structural faults, fit outs and local council zoning are significant factors in assessing a property.

Once all facts are accumulated, with the latest comparable sales figures in the neighboring area and current market rates, a comprehensive valuation report is prepared to determine the worth of the property.

Property valuation fees are part of the home loan process and can vary depending on the bank or lender, or it can be waived off.

 

Reference: Industry Insight – Gulf News Freehold

Massive investments put Dubai in forefront

Investors

The city has many development projects that attract foreign investors an important stop on the global sea-air trade and commerce, within an eight-hour flight between Europe and Asia and hosting the 2020, Dubai has exhibited a tremendous transformation over the years.

Large-scale developments have spurred business and investment opportunities, putting the city in the global property market map. To provide city-wide accessibility and promote city as a top economic and tourist hub, developments in Dubai center on airports, transportation networks, canal projects and a lot more.

With an estimate cost of 6.45 billion euros, the Dubai Trade Centre Jebel Ali will be the venue of the Expo2020. It will have Al Wasl Plaza nestled among theme pavilions, entertainment venues, soaks and a housing village. In close quarters the Jebel Ali Port and the Al Maktoum International Airport which will spend Dh120 billion on expansion.

The proposed Dubai Metro 40 kilometer track expansion will add 23 new stations including Al Maktoum International Airport, Mirdif City Centre and a possibility to connect to the Meydan Station of the Etihad Rail. Also, the Dubai Tram, which is expected to start operation this month, will whisk passengers comfortably to the Dubai Metro and the Palm Monorail. Additionally, the RTA Sky Buses, which have large baggage Compartments and catering services on board, will ferry passengers from the Dubai International Airport to 26 hotels across the city.

The colossal Mall of the World will be the world’s first temperature controlled shopping complex. It will have a promenade lined with retail shops, an indoor family theme park and wellness resorts. The Dubai Water Canal project will provide various points with a link to the Arabian Gulf. It will feature footbridges, walkways, hotels, restaurants, shopping centers and marine transit stations for water taxis. Dubai holds a formidable record of development projects. No wonder it takes the lead in attracting investors to the country.

Reference: Industry Insight – Gulf News Freehold