Meadows Partners specialises in selling blocks of flats, units and developments sites. We have sold or negotiated over 235 blocks of flats (click here to view our sold blocks) since we started and we have many more currently in the pipeline. To date, that is an average of 7 per annum.
We have one of the largest databases of investment block owners, builders and developers. We have also sold to several syndicate promoters on many occasions, with whom we keep in regular contact.
Advertising is an important part of the process however private databases are essential in supplementing this process to maximise the interest of buyers.
Method of Sale
There are four methods:
Sell in one line (Private sale/auction/expression of interest/for sale by tender)
- One transaction
- Certainty of price and settlement
- No joint ownership
Sell individually as they are
- Should be a higher price than in one line
- Differing prices and settlements
- May take longer
- Some time of joint ownership
Sell individually after renovation
- Higher gross realisation than as they are
- You will need to invest dollars in renovation
- It will take a longer time to reach the market
- Some time of joint ownership
Sell individually after renovation by joint venture
- The same as above but having an experienced developer to guide you or do the work for you.
- The arrangement will depend on the agreement between the two parties but for example, splitting the costs and profit 50/50
- This should raise your gross realisation significantly but you will need to compare the extra build cost to the additional income
- Subject to councils new planning
- Architect will give a guide as to what can be done
- Renovation and additional new build cost
- A much longer time frame to wait for plans, permits, build etc.
Profile of Potential Purchasers
In the last two years we have seen increased numbers of investors buying block of flats. This is fuelled by low interest rates whereby bank interest is often lower than property returns.
Over the years developers have been the principal buyers of blocks. They will usually renovate inside and out to raise the value of the flats and sell individually.
These groups have been strong buyers in certain circumstances. They will regularly pay significantly more than developers because they comprise of individual investors buying as a group, and usually they retain them as long term investments. They can only buy if the terms are favourable i.e. the vendor must offer separate transfers for each unit.
Terms of Sale
You will need to decide on acceptable terms for the sale.
For example, you can insist on 60 to 90 days settlement, which can limit some buyers, or accept a longer settlement time which may provide greater flexibility for buyers and hence a higher purchase price.
The deposit is usually 10% of the purchase price.
Developers may request permission to apply for town planning permits or the rights to conduct a cosmetic renovation during the course of the settlement.
Selection of an agent
It is important that you confidently expect your agent to exhibit the following traits:
- Honesty and integrity
- Well connected
- Personable character
Marketing and Advertising
For the sale of a block of flats it is essential to advertise the property to reach the target market efficiently.
The following is recommended:
- The Age Domain newspaper
- The Melbourne Weekly Magazine
- Database email
- Block Investor postal mail out
You have the option as which of these you are prepared to pay for.