"Through the fence" sales are selling short
Rural property sales to adjoining landholders often occur with the hope of saving costs, but Michael Guest explains why this is rarely the case.
The current optimism in the rural property market has resulted in some property owners selling their farms ‘through the fence’ to neighbours. While this might seem to have cost saving advantages, Michael Guest, Director at Rural Property NSW, indicates otherwise.
“Most of these properties are being sold below their potential and vendors are not realising the maximum profit for their asset. More often than not these are one on one transactions based on historical pricing rather than reflecting the current market,” said Michael.
“One recent sale involved all four neighbours expressing a desire to purchase. After discussing options with the vendor and introducing additional interested parties, a sale to a non-neighbour resulted in a sale 15% above the price initially expected by the vendor.”
Michael said that marketing campaigns are attracting an unprecedented number of potential buyers with inspections for most properties numbering between 12 and 20.
“Auctions over the last 6 months have attracted multiple bidders resulting in 100% clearance and all sales have been significantly higher than current valuations” he said.
Michael added that an agency-assisted marketing campaign is proven to boost competition and more than justifies the costs involved.
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