Purchase and Sale LV 2+3 Flashcards
Explain a factor which impacts upon sale value/sale terms.
Location is a significant factor that will affect value as there a locations that are in more demand than others.
“Explain an example of when you have provided marketing/sale strategy
to a client.”
“Industial unit Horley- my marketing strategy was
- Targeted mailshots to client lists
- call known investors and contacts
- Press and internet advertising
- To Let board
- Internet advertising “
“Talk me through an example of when you have purchased/sold a
property.”
“I recently sold an industrial unit, Gatwick Metro Centre in Horley, on
behalf of a private individual as part of their pension. Upon
instruction, I carried out a conflict check and then inspected and
measured the property. Marketing details were created and
uploaded onto our website, NovaLoca and Egi. Details were also
emailed to registered applicants on our database and around the
Industrial Agents Society.
I had a series of block viewing dates with numerous interested
buyers. I had two competitive offers, one was a cash buyer and the
other needed a mortgage. The cash buyer provided a good
covenant, checked through Experian. I recommended the client
proceed with their offer. However, the cash buyer withdrew his offer
as a company contract was withdrawn from them. I therefore
recommended the client proceed with the next best offer as an
objective of the client was to close quickly on a sale.”
Tell me about the industrial unit in Horley which you sold
“I recently sold an industrial unit, Gatwick Metro Centre in Horley, on
behalf of a private individual as part of their pension. Upon
instruction, I carried out a conflict check and then inspected and
measured the property. Marketing details were created and
uploaded onto our website, NovaLoca and Egi. Details were also
emailed to registered applicants on our database and around the
Industrial Agents Society.
I had a series of block viewing dates with numerous interested
buyers. I had two competitive offers, one was a cash buyer and the
other needed a mortgage. The cash buyer provided a good
covenant, checked through Experian. I recommended the client
proceed with their offer. However, the cash buyer withdrew his offer
as a company contract was withdrawn from them. I therefore
recommended the client proceed with the next best offer as an
objective of the client was to close quickly on a sale.”
Talk me through how you determined the covenant of the buyers
I used a credit check and revewing the companies latest accounts on companies house
Tell me what a strong covenant for a buyer is
financial strength and stability of a buyer
“Talk me through how you led the marketing campaign to sell the office In
Crawley”
“Office, Northgate House, Crawley
I sold Northgate House in Crawley, a self-contained 1980’s office
building, approx. 9,709 sq ft located on Crawley High Street. I led
the marketing campaign which included preparing marketing
particulars, erecting a marketing board on the front of the property and handled the mail shot and social media campaign. I dealt with
interested parties and reported to the client.
I originally marketed the building at £1.75m which was the price the
client wanted to achieve. However, I received limited interest
throughout the marketing campaign, so I advised the client to
reduce the guide price to £1.5m. I recommended transferring to an
auction sale as one of the client’s objectives was to achieve a swift
disposal. Another firm was instructed as auctioneer, on our
recommendation, because we do not have a commercial auctions
service line and I recommended the other firm in order to provide a
good service to the client. I remained agent.”
“Tell me what the benefit of a strong marketing campaign has when trying
to sell a property”
A strong marketing campaign gives you the best chance of druming up interest and finding a potential buyer for the property
Why did you advise the client to reduce the value of the office?
We received limited interest throughout the marketing campaign at £1.75 million so I advised the client to reduce the price to £1.5 million
What was the benefit of transferring the sale to auction?
There was a short timescale to disposal, Certainty of sale and transparency
“Talk me through how you disposed of Industrial units In Forge Wood
Explain what advice you gave to your client”
“Industrial units Forge Wood Employment Area Crawley
I acted on behalf of a Housing Group to dispose the freehold of 14
new employment units in Forge Wood in Crawley. The site was part
of a mixed-use development. The units were required to serve as a
noise mitigation barrier to protect the occupants of the new
dwellings immediately to the east.
I advised the client to go to best bids as the informal tender method
is used where there is a lot of interest in a property and is beneficial
to achieve the best possible offer. I received 21 offers for the 14
units. After the best bids process, I filtered and analysed the offers
based on covenant strength, number of units offered by a buyer
and purchase price. I advised which offers to proceed with and had
6 serious offers, including an investor who wanted to purchase the
freehold for 1-7 and another bidder who wanted the freehold of 3
units. The other offers were for individual units.
I advised the client to accept the investor and the bidder for the 3
units. Then the last 4 bidders secured their individual units.
I advised the client that I send out regular updates in order to keep
the various bidders up to date as the legal transfer would take a
long time as a result of a consortium agreement between various
stakeholders.
I advised our client and their lawyer to draft a briefing note which I
amended and sent to the bidders to explain the transfer as the
Employment Buildings fell into different legal ownership as part of
the consortium agreement between our client and various
stakeholders.”
Explain the Informal tender method
Informal tender, also known as sealed bids, is used where there is good market demand or where negotiations need to be brought to a close after a period of marketing via private treaty. However, the costs are generally higher than selling by private treaty.
Explain how you analyse the best bids and what Impact this had on the advice you gave to your client
“I received 21 offers for the 14
units. After the best bids process, I filtered and analysed the offers
based on covenant strength, number of units offered by a buyer
and purchase price. I advised which offers to proceed with and had
6 serious offers, including an investor who wanted to purchase the
freehold for 1-7 and another bidder who wanted the freehold of 3
units. The other offers were for individual units.
I advised the client to accept the investor and the bidder for the 3
units. Then the last 4 bidders secured their individual units.”
Can you explain why the legal transfer was lengthy
”
The various industrial units within the Employment Building fall into different legal ownership depending on where they are located within the building.
The Employment Building has been constructed as the result of a development agreement reached between 4 parties which requires that various steps are undertaken prior to any onward sale of the industrial units within the Employment Building taking place. “
Talk me through your disposal of an office In East Grinstead
“Office- Hampton House, East Grinstead
I acted on behalf of a private individual to dispose of an office
building in East Grinstead. The site comprised of an approx 2,505
sq ft 1990’s office building with land at the rear and a first floor barn
of approx. 607 sq ft.
I advised the client on the process of AML checks before we could
start marketing. Due to the high level of interest received, I advised the client to
transfer the sale method from private treaty to informal tender, i.e.
best bids to achieve the best possible sale price.
I advised proceeding with the offer that was a clear leader which
was over asking price and a cash buyer. I advised against
proceeding with the other offer because the buyer needed a
mortgage and their offer was at asking price.”
