Due to our commercial co-marketing program for sale by owner, we are witnessing many commercial owners market and go through the “process” of selling their buildings, without the help of a real estate broker. Although the experience can be painful, selling on your own is doable; especially if you know what you’re doing.

Below are some of the common mistakes we see homeowners make.

overpriced property

Overvaluing the property is a big deterrent and a big common mistake that sellers make. Most buyers who feel that a property is overpriced move quickly. Serious buyers typically inspect many properties and learn market values. Sellers often think that if a buyer is interested, they will simply submit a lower offer; that idea rarely works.

Many sellers are just unrealistic and don’t do their homework on value. It is necessary to obtain information on “comparable recent sales”. Understanding the revenue approach to value is also critical. Hiring an appraiser is the most trusted and accepted way to determine market value. You can also find information about other buildings sold in your city in the appraisal department.

This is a sore point for many sellers if they have invested a lot of money in a property. Especially for owner occupants (Company that owns and operates out of the building). The harsh reality is that it is very possible to over-enhance a property.

We see owners try to sell on their own for many months, take ownership costs, give up, then list with a broker, only then to bring the sale price down.

Lack of knowledge about handling paperwork.

Selling a property, especially one with issues (environmental concerns, title issues, zoning violations, etc.) can be tricky. Paperwork can be intimidating and it must be done correctly. Not knowing how to handle the paperwork will quickly kill any potential deal.

The buyer needs the confidence that they can close successfully, without violating any laws or creating long-term legal problems. Not partnering with professionals to help with the details can be a mistake.

Putting the property under contract without prior evaluation (prior approval) from the buyer first. We’ve seen a lot of time and effort wasted on buyers who might never qualify for a loan in the first place. It is an unnecessary mistake.

Sellers are anxious because they have an offer and want to move on. They put their property under contract with the buyer, take the building off the market (perhaps without a legitimate buyer), and incur maintenance costs while they wait (often for several months) for the buyer to do their due diligence and obtain the necessary financing. . . Only later to learn that the buyer could never have been qualified in the first place.

In addition to the frustration of this scenario, there are also legal issues (risks) and costs of putting your property under contract. While there will always be a risk of losing buyers (for many reasons), you can avoid this by having your buyers’ books reviewed and receiving “pre-approval” letters from finance companies.

not be accessible

Simple enough, shoppers are picky, forgetful, and busy. If they try to schedule an appointment to inspect your property and you can’t fit into their schedule or return their calls, they will give up and move on to the next facility.

Unpresentable Property

There is some common sense stuff here too, but we see that many owners do not clean the premises properly or do not have the basic components of the building’s operation (rolling doors, broken windows, HVAC units, alarm systems, etc.).

Unrealistic about marketing

Simply having a sign on the front of the building is not enough. Perhaps one of the neighboring companies is interested, but relying on that alone is likely to be a mistake, resulting in increased time to market and thus increasing your maintenance costs. The idea is to maximize the exposure of your buildings so that they are in front of as many buyers as possible.

Here are some creative marketing ideas we’ve heard other homeowners implement successfully:

• Mailers/postcards to local tenants in your area, in your type of building (Office, Industrial, etc). Realtors sometimes do this; the list is typically 500 – 1000 names.

• Internet Marketing. It has been estimated that 75-85% of all buyers now start their search on the Internet.

• Professionally designed exterior signage. This is one way to build credibility with potential buyers.

• Professionally designed data sheet. It’s also a way to build credibility and highlight the key features and information they need to qualify a building for use.

• Classified ads in local newspaper. You can go a step further and advertise in trade magazines, especially if you have a “special use” building: restaurants, medical facilities, etc.

• Referrals: Informing the professionals you hire and work with can be an effective way to get the word out. Accountants, lawyers, etc. they usually know of other companies that need space.

• Teaming up with industry professionals (title companies, finance companies, etc.) who can help you with the various details will ensure you have the best possible chance of successfully closing the sale of your facility. Your business is knowing the market and knowing how to do it.

Non-Saleable Building, from the Beginning

Many homeowners do not recognize problems with their buildings that can make it difficult or impossible to sell or finance the property.

Environmental issues can dramatically complicate a sale and can eliminate the possibility of conventional financing. Although there are still changes in legislation, government financial support and clean-up techniques, the costs and time to sell properties with environmental problems are significant.

The structural and/or building condition is another matter. Roofs are a typical example. Roof repair or replacement costs can jeopardize financial ratios and the cash needed to close. Oftentimes, lenders won’t release the funds until the repairs are complete as well. Determining who will pay the costs is often a sticking point. Neither the seller nor the buyer may have the additional cash.

Structural issues can be a bigger problem and often eliminate the possibility of conventional financing altogether.

Title issues are another problem and can make financing almost impossible.

Building owners can be prepared to deal with these issues by resolving them before putting the property on the market or by having adequate information (for example, repair estimates, phase one completed) on hand before attempting to sell the property and adjusting the price of the property. sale accordingly. .