by Eifion Bibby of davis Meade Property Consultants
Despite the uncertainty afforded by volatile commodity prices and the non-stop debate over whether to stay in or leave european Union, there continues to be ongoing activity in the rural property market with the principal objective for Vendors, in most instances, being to optimise value. During the buoyant housing market of the “noughties” residential property flew off the shelves without much effort, and whilst there has been a resurgence after the credit crunch, the sector is more restrained and planning ahead will be a key factor in effecting a satisfactory sale. so how do you go about maximising the value of your property and mitigating unnecessary delays when you come to sell? the first thing will be to ensure that everything is in place to try and prevent frustrating delays, including legal tile documents and associated plans, as well as ensuring that planning building regulations and other permits are available. You should also seek advice from you agent, in good time, on whether there are prospects to add value by e.g. applying for development consent, for example, to convert an outbuilding and, in certain instances, if it is worthwhile to look into capitalising wayleaves .
Auction or tender v private treaty?
in most cases it will be appropriate to sell by private treaty but there are instances when auction or tender could be more effective . A lot will depend on the type of property itself and also the current state of the market. As a rule we would target a property for public auction when conditions are relatively robust and there is likely to be competition. in a “standard” market we would favour a residential property that needs refurbishment, or at least, updating, a development plot or a barn with planning consent for conversion, and very often farms and agricultural land. Usually we would not advise an auction for a property that has already been extensively advertised, but has failed to sell, or a residential property that doesn’t need significant upgrading, unless the sector is very buoyant. For example, it is unlikely that an updated house on a residential estate would be recommended to be auctioned, unless it was subject to a forced sale or the seller was prepared to accept a discounted price. in a regular environment you would look to market a property with a house for a minimum of five to six weeks, and agricultural land for at least four weeks prior to an auction. selling by public auction certainly has benefits, where on occasions a sale by private treaty can fall through after an offer has been accepted, an auction can provide for greater surety of the transaction being completed. Also it will be up to the seller to decide at the event if the property is sold or not and, if it does sell, the vendor could then expect to have a fixed timescale for completing the transaction – usually four to six weeks. For those vendors opting for an auction it gives prospective buyers the opportunity to compete and to establish the true market price. potential purchasers must make sure they have the finance in place for the deposit on the day of the auction and be in a position to complete within a specified time scale, as, if successful, they will be entering into a binding contract on the fall of the hammer. tender can also be useful as an alternative method of sale, in certain circumstances, when one seeks to invite best offers by a fixed date (by adopting a similar advertising programme to auction) but without having to make an instant decision in a public arena. Arrangements can be made for successful offers to be binding or accepted subject to contract depending on whether a formal or informal tender exercise is adopted, which will largely be determined by the state of the market.
Eifion Bibby, Davis Meade Property Consultants, 01492 510360, mobile 07969 273433, email: firstname.lastname@example.org