PLP Is Now Live!
Following the success of the inaugural Places & Properties (PLP) “Live” Malaysia Property Conference here in Petaling Jaya, Selangor, Malaysia in August, we are proud to launch our official blog. This site will contain an archive of all our recordings from the 2013 PLP Live event (if you were a paid attendee then you will also receive the password to the secret vault as we promised during the event). Many thanks to our sponsors Advanced Realtors Academy, GoodPlace.my, Sin Tak Manufacturing and The Greater Klang Valley Property Investors Club.
We would take this opportunity to feature an article from our upcoming PLPLive Magazine issue (you should be getting a copy in your mailbox already if you are a Premium member of PLP). I hope you find it useful!
PLP Exclusive: How To Sell A Bad Property
Thank you to Zechariah Chan and Rebecca Andrew for extra inputs. For feedback, email firstname.lastname@example.org or email@example.com – we will get back to you typically within 24 hours.
How do you exactly sell a bad property in Malaysia?
It is bad enough to sell your property in a bad market – when the prices are never ideal enough to make up to make a profit, let alone to pay for your overhead costs. It is even worse if you are selling a bad property. These are things that you can hardly sell no matter how the market is faring. And going by the surety that the Malaysian government is going to introduce some cooling measures in the upcoming budget it’s going to be a cold, cold winter for property agents and sellers alike.
But what really is a ‘bad property’?
A bad property can be anything from a house that sits in a bad neighborhood or a bad location, a property that’s had a bad history, or a house with a degrading condition. Trust me, I’ve seen many of these in the Klang Valley – even in upmarket places like Mont Kiara, Sentul and KLCC. Too many, in fact!
These are the properties that you can hardly do anything about – or at least do anything that is within your budget anyway. These are ones that no amount of curb appeal improvement or home staging could make attractive to buyers.
For one, buyers don’t like it because it’s inconvenient, second, lenders don’t like them because of their low foreseeable appreciation rate and therefore they hardly grant mortgage (or big mortgages) to prospective buyers for exactly these types of properties.
So how do you sell a property that is branded “bad”? Here are some tips – thanks to Jaime Lee of Kinrara Properties for some of these:
- Decrease your price. Given that you cannot do anything about the situations that surround your property, the least and practically the most logical thing you can do is to sell your property at a lower price. That should be the only thing that would make the house seem attractive to home buyers so take a shot at it. Don’t fall into the trap of the “herd mentality”: just because you own The Binjai On The Park inside KLCC it doesn’t mean that you can sell at RM2,000 per square feet.
- Hire the services of a good real estate agent and help in the aggressive marketing of your property. You won’t earn much from your property but an expert marketer might be able to do some magic at selling your house despite its conditions. In this scenario, your agent might be able to sell your property at a more ideal price, but it might just be enough to cover your costs and the commission of the agent. Don’t expect the profits. And while at it, help out in selling your home because your agent is an agent and not a genie, unfortunately. If you want a list of “recommended” property agents who are specialized in Malaysia property, get in touch with me.
- Spend on home improvements. If you have the cash for it, might as well take the chance to make your home stand out. But let me warn you, this is a very risky move. Other ‘bad’ circumstances might hinder marketability and your efforts might prove futile and costly – the expenses of which you may never get back ever. A good resource on home improvement is the Home Depot blog.
- Put your home on auction. This is the easy alternative for Malaysian homeowners having a hard time selling their property. The auction house is the hub of home buyers looking for cheap, bizarre, or dilapidated property, and the rescue center for those trying to sell their bad property. There are slight but clear differences between auction and regular selling that you might have to learn beforehand. Don’t expect for your house to sell at a high price. Unfortunately there are very little online auction information available for Malaysians, although the CIMB auction site is pretty good (see this).
The thing about selling a bad property is that it just cannot sell at a high price – and that’s something you would have to prepare for. Good luck.
Keep in touch!
Matthew Lim, MBA (Strathclyde)
Chief Editor, PLPLive.com (email: firstname.lastname@example.org)
PS: We are currently looking for associate editors for this blog. If you have experience blogging in real estate (familiarity with Malaysia properties is a must), please email me or call 016-2778289. Thanks!