Why people can’t sell their homes

The en­vi­ron­ment for sell­ing a home is not with­out its chal­lenges, es­pe­cially in a tough prop­erty mar­ket.

But for a few un­for­tu­nate in­di­vid­u­als, try­ing to sell off their prop­erty (even in good times) can be next to im­pos­si­ble, no mat­ter what they do!

The fol­low­ing are rea­sons why some po­ten­tial sell­ers have prob­lems dis­pos­ing off their homes.

Bad lo­ca­tion

We all know this one – when its comes to suc­cess­fully sell­ing your prop­erty, it’s all about location, lo­ca­tion, lo­ca­tion. What amounts to good or bad lo­ca­tion is ac­tu­ally quite ob­jec­tive. But se­ri­ously, how bad is “bad?”

Ac­cord­ing to Malaysian In­sti­tute of Es­tate Agents (MIEA) pres­i­dent Siva Shanker, there are some lo­ca­tions that no­body wants to live in.

“This could be at a T-junc­tion, next to an ox­i­da­tion pond or even a power sub­sta­tion,” he tells StarBizweek.

Siva adds that many buy­ers are also re­luc­tant to pur­chase homes lo­cated near over­head power lines.

“We have a set stan­dard based on guide­lines by the World Health Or­gan­i­sa­tion on how far these lines need to be away from the homes. But re­gard­less, buy­ers still pre­fer not to live in areas where there are power lines near by.”

Carey Real Es­tate Sdn Bhd man­ag­ing di­rec­tor Nixon Paul says most Malaysians can be quite su­per­sti­tious about where they choose to live.

“Peo­ple are re­ally into the feng shui el­e­ment. Houses with the num­bers four on them, are typically dif­fi­cult to sell.

“And this is even among nonChi­nese buy­ers, who fear that they might not be able to sell the prop­erty in the fu­ture.

“A house sit­u­ated next to a sew­er­age fa­cil­ity or a ceme­tery can be a prob­lem when to sell,” he says.

Ter­ri­ble con­di­tion

You’re not go­ing to be able to at­tract buy­ers if your home looks like it could col­lapse at any time.
“A di­lap­i­dated place over­grown with grass and where the walls are full of cracks or leaky roof is un­likely to at­tract any buyer,” says one in­dus­try ob­server.

Siva how­ever feels that a run­down prop­erty could ac­tu­ally be a bless­ing in dis­guise.

“I feel that it’s bet­ter to buy a dump for a cheaper price, and then spend some money to refurbish it into its for­mer glory, or some­thing even bet­ter.”

Siva says many Malaysian buy­ers can­not “vi­su­alise” the po­ten­tial of a di­lap­i­dated home.

“The av­er­age buyer can’t see what a house that is in ut­ter dis­re­pair can be turned into, be­cause all they see is a home that is in ter­ri­ble con­di­tion.

“On the other hand, when he vis­its a de­vel­oper’s show unit, he is so cap­ti­vated by what he sees be­cause it (the show unit) looks so amaz­ing. In his mind, he thinks he’s pur­chas­ing that prop­erty but what he’s ac­tu­ally buy­ing is an empty shell.”

Siva says spend­ing a bit of money to spruce up a place can be ben­e­fi­cial. “Why not spend RM20,000 to spruce up a place worth RM500,000 so that you can sell it for RM550,000?”
He says the sit­u­a­tion is sim­i­lar even for ten­an­cies.

“Most land­lords are also un­will­ing to ren­o­vate a place to make it look more at­trac­tive. In­stead, they would rather wait for a confirmed ten­ant and then only ren­o­vate.

“This may not even hap­pen (se­cur­ing a ten­ant).

“This is where home-stag­ing comes in,” says Siva.

The con­cept of home-stag­ing, which is aimed at im­prov­ing the prop­erty’s ap­pear­ance in the eyes of po­ten­tial buy­ers (with the ul­ti­mate goal of a quick sale and for a bet­ter price tag), is pop­u­lar es­pe­cially among coun­tries in the West.

Stag­ing usu­ally in­volves some­thing aes­thetic, im­prov­ing the de­sign, or­gan­i­sa­tion and over­all ap­pear­ance of a prop­erty.

In some in­stances, the po­ten­tial suc­cess of sell­ing your home can be de­pen­dant on the condition of your neigh­bour’s prop­erty.

“If your neigh­bour’s house is run-down or di­lap­i­dated, your house can also be­come af­fected,” says Nixon.

Un­rea­son­able prices

Another in­stant where prop­erty can be hard to sell is when the seller sets the price of the property ridicu­lously high.

“This is a typ­i­cal case of over­pric­ing, where the owner is just greedy and the ask­ing price is too high.

“And be­cause of this, the prop­erty re­mains in the mar­ket for­ever,” says Siva.

He adds that in re­cent times, strin­gent loan ap­provals have also made it tough for pur­chasers to get a loan.

“You might find a buyer, but then he might have a prob­lem get­ting a loan.”

Un­der Bank Ne­gara’s re­spon­si­ble lend­ing guide­lines, which were im­ple­mented on Jan 1 last year, loans are now ap­proved based on net in­come com­pared with gross in­come pre­vi­ously. - By EU­GENE MA­HALINGAM (Star Property)