To sell a property at best, several elements must be taken into consideration. And several steps must be respected. Here we give you our advice on how to set up an effective sales strategy to sell your property as quickly and efficiently as possible.
What are the elements of a fair real estate valuation?
To sell your property at its best, it is not simply a matter of setting a price. Moreover, given the real estate market in Luxembourg, many owners would be tempted to increase the sale price. But is this the right strategy?
Evaluating your property to sell it at best is above all determining the fair value of the property. Fair value is the price that a buyer will be willing to pay for your house or apartment within a reasonable time frame. This prerequisite is one of the key elements of an effective sales strategy, in order to sell as fast and as well as possible. This is especially true in Luxembourg, which is a buoyant but complex real estate market.
The fair price is evaluated according to :
- The estimate of the “market value” of the property. This market value can be assessed by determining a range of asking prices for equivalent properties in your area. The latest trends in the Luxembourg real estate market should give you an idea of the market trend.
- Any renovation work to be done should also be taken into account. When a potential buyer visits your house or apartment, he will note all the defects of it. The paintings have to be redone? Is the kitchen obsolete? Are the bathrooms aging or “in their juice”? The terrace is not maintained? So much work that the potential buyer deducts from the asking price before making an offer. it should be noted that in Luxembourg, the market is driven upwards by new real estate.
- The assets of the property. These should be highlighted. Your home is very well located, close to schools, shops, public transport? Do you have a large balcony or terrace? Your garden is huge? All these assets will be appreciated by your future buyer. On the other hand, since the Covid confinement, the absence of an exterior is now an obstacle to sales. The same applies if your home is located on the 3rd floor without an elevator. In these cases, expect the sale to take longer to complete unless your selling price takes these weaknesses into account from the start.
- Evaluation of supply and demand. Is your home the only one for sale in the area? Is your apartment considered a rare property for sale? So many assets in your sector.
- Future prospects for the local real estate market. Are there any prospects for the development of public transport in your area? Get information from the municipalities, follow the news. Perhaps these developments will boost your selling price.
To know the right price of your property, do not hesitate to call upon several real estate agents to have it evaluated. Beware of high valuations that will keep your apartment or house on the market too long. A property that takes a long time to sell depreciates by itself.
Once the property has been evaluated at its fair value, it is time to think about its marketing.
What are the main steps in selling a property?
If you decide to sell your property through a real estate professional, ask them about their strategy. What are his references? What marketing will they put in place to sell your property as quickly as possible?
Putting your property up for sale
If you decide to sell your property by yourself, advertise it on real estate portals. Emphasize its strengths. Remember to tidy up your home before taking pictures. Remember to take the pictures during the day. Enhance the brightness of your apartment or house.
Don’t forget the sites of sale between individuals, nor the social networks. In Luxembourg, there are specific pages on facebook. Use word of mouth. Luxembourg is a big village, don’t forget that!
Constitution of the file of sale of a real estate
Prepare in advance all the necessary documents for the sale of your home. These documents will be requested either by your potential buyer or by the notary in charge of the sale. Here are the documents you need to prepare:
- Accounts and regulations of co-ownership with the last minutes of general meetings for an apartment
- Statement of condominium charges, gas, electricity and fuel bills.
- Proof of boiler maintenance.
- Insurance statements
- Plans and building permit for a single-family home or apartment building if you have them
- Proof of ownership
- Energy passport, mandatory for sales and rentals
Visits to potential buyers
Your apartment or house is for sale and you have requests for visits? Congratulations! When conducting tours, remember that visitors’ questions and comments are not personal. They just ask all the normal questions when buying a future home.
Do not hesitate to inquire about the creditworthiness of your potential buyers if they make you an offer to purchase. Price negotiation is an important element for them as well as for you. Do the buyers already have a bank agreement? Do they have sufficient personal funds? Don’t hesitate to ask for proof before signing a preliminary sales agreement with a buyer who doesn’t seem reliable.
Signature of the sales agreement
The compromise of sale is a very important step since it seals the agreement between the parties. It is a final contract between the buyer and the seller. It must include the following:
- names and addresses of the parties, seller and buyer
- designation of the building to be sold: address, cadastral reference, details of the property, ….
- selling price
- method of payment
- existence of any easements
- date of the notarial deed and name of the notary
- planned date of entry into possession and handing over of the keys
- possible occupancy compensation in case of delay in handing over the keys
- loan suspensive clause. This is intended to reassure the buyer in case he does not obtain the necessary financing for the acquisition. The mention of this suspensive clause does not oblige him to buy in case of non-agreement of loan by the consulted financial institutions. This clause generally allows a period of 4 to 6 weeks for obtaining the loan from the date of signing the compromise. To be released from his commitment, the buyer must provide at least one, and possibly two, bank refusals within the time limit. Beyond that, he is committed to buy the property and to pay the fixed price. otherwise, the penalty clause applies.
- penalty clause. Its existence obliges the potential buyer in case of withdrawal from the sale to pay an indemnity to the seller. This indemnity is generally set at 10% of the sale price fixed in the compromise.
The registration of the sale agreement with the Administration de l’Enregistrement et des Domaines (Registration and Land Office) makes it enforceable against third parties. This registration must take place within 3 months of its signature. The registration fees are 12 euros in the case of a compromise with a suspensive clause and 7% of the sale amount in its absence. The 7% represents the advance on the notary fees.
Signature of the notarial act
The compromise of sale acts the contract between the buyer and the salesman. The notarial deed formalizes the change of ownership. It is generally carried out within 2 months after the signature of the compromise.
The deed of sale can be carried out by any notary on the Luxembourg territory, regardless of the location of the property concerned. The legal guarantees run from the date of signing the notarial deed.
The loan deed will be signed at the same time by the buyer.
The notary fees will be settled at that time. They are generally charged to the purchaser, but can be agreed upon by the parties.
Our advice for the sale of a property
A real estate agent knows the local, commercial, legal and financial environment that is related to the sale of real estate. Calling on a real estate expert will save the seller time, money and, above all, nerves! A real estate agent will accompany you throughout the sale process and will be able to advise you in your best interests.
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