Separating the wheat from the chaff
2nd September 2017
We are in the fortunate position of selling a site which is attracting a number of very serious offers.
The site has never been put out on the market; yet, somehow it has managed to worm itself on to the market, indeed it has even been offered back to me at least twice.
There are those in property who make it their business to operate on the principle that if they shovel enough ‘dung’, some of it may stick. They call themselves agents (and often make first contact in the guise of a buyer). They know next to nothing about the development they are selling. Yet, they want to charge the buyers a couple of large percentage points to sell a site they know nothing about and have no mandate to even sell.
Unfortunately, this is the state of the market; literally anyone with a mobile phone can call themselves an agent. In one respect, this can be a good thing, it means the market is open for business for anyone, and therefore it attract a lot of entrants. On the other side, this means you have to deal with a lot of nonsense to get to the reality of the underlying situation.
After being in the trade for a while you tend to develop a nose for who is a serious buyer, and who is a chancer.
There are means and ways of confirming whether the buyer is the real deal. Firstly, you can ask the lawyer to confirm proof of funds. Be very careful in how this is conveyed to you, as the letter can be worded in a clever way so that an impression is created that they have the funds, when actually they do not.
Secondly, look at the law firm they are using, a serious buyer will have a heavy weight law firm to back them. With one of our buyers I actually knew one of the partners in the firm acting for them, and was able to do a discrete check in the background to ensure our buyers were good for the money before sending contracts out.
Thirdly, any serious buyer should be able to operate within a tight but reasonable time frame. There is no need to have lawyers going back and forth for months. If you give enough string this is what tends to happen. Often lawyers aim is not to get the deal done, but to cover themselves from any liability, and in doing so they may unnecessarily extend the time taken to get a deal done.
Potentially an exchange can happen in a day. After all it happens every time there is an auction, followed by a swift completion in four weeks. This is the beauty of an auction, there is certainty of sale for the seller, and time frames are defined, assuming the reserve price is set at a reasonable level.
Finally, it’s a small world and it doesn’t take long with online platforms such as LinkedIn, to check out whom the buyer is; and if you don’t know them, you will find someone who does.