How to fetch a higher price for your home in a subdued property market

By: | Updated: August 4, 2015 4:53 PM

Despite property market being subdued, a few minor alterations could help fetch a higher price for your home

property tax benefitsWhile one cannot do much to improve the market situation at present, one can certainly take few steps to make the property on sale more marketable and generate more value at the time of the final sale. (Reuters)

The property market in India has been subdued for last few years. Despite stagnant prices, there has not been any spurt in demand for homes. Residential sales have dropped in leading cities of the country because of high prices, sticky interest rates and cautious buyer sentiments. As a result of the subdued end-user and investor sentiments, many developers have abstained from launching new projects and are focusing on reducing the existing inventory pile-up.

For instance, in May, while the inventory level in Mumbai was 37 months, in NCR’s Gurgaon, it was 50 months, according to data from Prop Equity.

In Chennai and Bengaluru, inventory levels were at 32 and 28 months, respectively. While the real estate sector is currently facing short-term challenges, there are strong fundamentals, such as favourable demographics, domestic savings and continued urbanisation, which will boost the demand of residential real estate.

Subdued demand has also impacted home owners who want to sell their properties in the secondary market. Some even complain that the value they are getting is far less than they would like. While one cannot do much to improve the market situation at present, one can certainly take few steps to make the property on sale more marketable and generate more value at the time of the final sale.

Looks matter

Keeping your home spotless and well-maintained can make it more saleable. While it’s an obvious prerequisite to getting a good sale price, many sellers ignore this aspect. Since the property is to be sold anyway, maintenance becomes an afterthought and they do not even conduct the basic repair work. Usually, there is reluctance to spend money on improving the property assuming that the additional spend is dead capital. However, in reality, improving attractiveness and usability of the property will fetch returns that could more than compensate for the spend.

Create space

Homes with a lot of clutter and useless furniture left in balconies or unused spaces have become par for the course in rapidly imploding cities. Unserviceable items, such as damaged coolers, AC units, broken chairs, etc., are stashed away in balconies because they have not been disposed of. These create the perception of lack of space.

Declutter your home. Remove unused and unwanted items. Give your home, and your visitors, some breathing room. This will certainly increase the value of your property and buyers may be impressed to cough up more for their dream home.

Paint your home

High-grade painting may be expensive, but it surely improves the outer look of the property. It creates the first impression even before the prospective buyer or agent enters your home. Many times, the first impression is the last one on which the decisions are based. Spend some money, get creative with your house painting and see its value go up during the sale process.

Remodel selectively

Prioritise on kitchen, bathrooms, and living room. First off, you don’t have to spend huge sums of money to remodel your kitchen or bathroom. Make a few adjustments, which will work as well. For example, an extra cabinet with internal lighting in the kitchen, or extra large mirrors and cubicle shower areas in bathrooms, can impress buyers. Identify the fixtures and fittings that get grimy because of smoke, steam, and heat in the kitchen. Clean them, or replace them if they can’t be cleaned.

Ensure functionality

Usually, we ‘adjust’ to our home even when some taps don’t work, a few switches are out of order, or if a few drawers do not open. However, remember that this may not be acceptable to buyers, and any of these defects will lower the price of your home. Invest in fixing them so that part of your home is functional — the way you would like it if you were the buyer.

Finally, a word to the wise

Ensure that the house is in such good shape that the buyer could start living there immediately without spending on anything extra. Also, invest in maintaining good relations with your neighbours and your real estate agent.

Often, these aspects can turn unfavourable since word-of-mouth can be a huge deal breaker if you are not exactly topping the neighbourhood popularity charts. Take these easy steps and see the value of your property go up in the eyes of buyers.

The writer is CEO, BankBazaar.com

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