Remnants are not a problem but an opportunity. Builders and developers can sell their stock using the right strategies.
Your company has been in business for some time. At launch, most of the units were sold. Over the next few weeks, the sales almost ended, but there are still some apartments that can’t find a buyer.
This situation is very common. The construction company or developer needs to close its sales cycle. You need to shift your focus to new ventures. The last sales represent the final return on investment of months of work.
And now? What to do with these last remaining units? How to prepare your real estate marketing to sell 100% of your development? The sales team of nova city society is here to help with this article! So, keep on reading!
What is the problem with having properties in stock?
Remaining apartment or detached property is the term generally used for the last units of a property release. After a launch and sales phase, it is the unit that remains in stock and is waiting for a buyer.
The fact that a company has real estate in stock is not in itself a complication. After all, with each new development, we have a new batch of units for sale. If there was no inventory, there would be nothing to sell.
The problem is when it takes too long to complete the sale. Remember that there was a large initial investment in land, planning and projects, in addition to the initial phases of the work.
Real Estate Fair using interactive screens
You have to get to launch fast to start producing results. If these results are slow to arrive, the company may have problems with cash flow and to continue its operation.
Furthermore, a construction company depends on continuous production. Without a steady sales signal, it would not be wise to build new projects. Therefore, when the market identifies an increase in the level of inventories, there is a signal that the pace should be reduced. This is negative for the economy and for companies.
The impacts of high inventories
A very high stock ends up leading to a reduction in prices. It’s the law of supply and demand. The civil construction sector is attentive to the indicators, as this affects the entire profitability of its operation.
If the sales time becomes too long, additional problems arise. A high inventory sends an indication of stagnation and devalues the enterprise.
The construction company also needs to bear extra costs, such as condominium costs, as it starts to pay for the closed apartments.
There are also maintenance and cleaning costs, as it is necessary to keep the property immaculate in order to sell it.
In other words: sell these last apartments soon.
Remnants are not stranded properties
Great care must be taken not to devalue the remaining properties. Don’t let it be seen as “stranded property”. It is just the last unit to be sold.
In many projects, it may even be strategic to reserve some properties with greater potential. The developer often reserves the best land and units, knowing that they will be sold at a higher profit even at a later stage.
So don’t find it strange if you find good options among the remnants. Maybe it’s just an option.
Guide your sales team accordingly. A detached property is usually a great opportunity and even the buyer’s luck. Always show the positive side.
Why is it so difficult to sell the latest units of a development?
There are several factors that make it difficult to sell the remaining units of a project, whether it is a commercial enterprise, a commercial complex or a subdivision:
- You’ve already spent your entire marketing budget on the early stages of the project. There is no more PSV for a complementary campaign.
- With few units, it makes no sense to continue investing in advertising a sales stand. You will probably want to demobilize the stand and the on-call broker.
- Your best sales team and your real estate partner have already moved to other projects with greater possibility of earnings
- The main people with a suitable profile for this project have already visited it. It’s more difficult to generate new leads.
- The best properties (usually on higher floors, with less street noise, with better views or facing the sun) have already been sold. For subdivisions, we only have lots with poor location, or more irregular ones.
- Competition. Remember there are other options on the market. When people compare their end-of-stock with new releases, they may be finding better options for sale and more publicity from other companies.
7 alternatives to sell your remaining properties
1. Reduce prices for the last units
This is a common temptation – and perhaps the simplest solution. Giving discounts is an alternative to ending a sales cycle, as it increases the chances of success.
It works for the buyer because it improves the cost/benefit ratio. There are more people who want a good break. You will even find tips on blogs indicating the remaining ones as good purchase opportunities.
But it could be a bad idea for your company, as it worsens the results. You’ll end your sales cycle with a little less profit. Assess well the discount you are willing to offer and see if it really makes sense.
2. Real estate fairs
Real estate fairs usually attract a large audience, and many of them are looking for a good opportunity. You get the chance to talk to lots of leads and present your remnants, along with other releases.
Check out our article on real estate fairs, with tips for builders and developers. We have good cases using Showcase Real Estate and interactive totems.
3. Partnership with real estate agents and brokers
Maybe you need new sales channels. Your properties need a showcase to reach the end customer. If that showcase was a sales booth that has closed, then you need to regain visibility.
Complementary sales teams can attract these leads in a variety of ways. Perhaps they enjoy the flow of people who already visit their stores and websites, or perhaps they have a team that has an active mailing list of contacts.
Analyze how the capillarity of your sales team will increase. Look for partnerships with teams that have a good track record.
Remember that your goal is to reconcile a good result without a long deadline. A new sales force will do no good if it means even longer delays and a high commission on sales.
4. Permanent sales structure
A trend in the domestic market is to complement temporary sales stands with permanent or long-term showrooms.
Sales booths are still one of the main sales tools, as they reach an audience that already frequents the development’s region or that wants to see the building live before making a decision. Unfortunately they are not always viable for reasons of cost or design. Or they are demobilized after a while, as there is little stock or because of the progress of the work.
In these cases, a definitive space to present several remaining developments makes a lot of sense. A little efficiency is lost by not being the place of sale, but it is gained with a greater offer. With shared PSV and a complete structure, it is possible to present the units in any phase, from pre-launch to the remaining ones.
We usually use Showcase presented by the team of waterfront district block to present the projects of construction companies and developers. The use of interactive screens with a complete catalog of companies is very efficient.
5. Internet as a digital showcase
The internet has become one of the most important points in the sales funnel in the real estate market. Before leaving home to visit the first showroom, the lead has already visited several websites.
Your company’s website needs to be a good showcase of all your inventory. Signs of “last units” help to attract customers looking for opportunities.
Also consider including the offer on real estate portals and on real estate partner sites. Take advantage of good material about the project to stand out, indicating that it is a new property ready to move in.
6. Institutional campaigns
In your annual planning, direct part of your investment in institutional campaigns, not just commercial campaigns.
By doing this, you increase the perceived value of real estate. The benefit is global, reaching all current and future projects.
Strengthen your company’s image. Show that it has characteristics such as innovation, punctual delivery, respect for the environment, differentiated design and respect for customers.
It doesn’t matter if you are a new company in the market, or if you have decades of tradition. Build your brand with the same strength as your ventures.
7. Use current customers as a source for new leads
On some projects, it is common for an owner to refer new buyers. It could be friends, it could be relatives. Through word-of-mouth, the venture becomes better known.
This is very common in subdivisions, for example. The first buyers are the boldest, who take advantage of the launch. When telling the reasons that led them to purchase, they often attract the interest of other people with the same profile.
Encourage this behavior. One strategy is to offer discounts or bonuses for referrals. This becomes an added incentive and has a much lower acquisition cost than a traditional sales funnel. At the very least, remember to ask during the sales process if your customer has anyone else to refer.
For remnants, there is also the neighborhood argument. Remember that buyers are interested not just in the apartment, but in the lifestyle they will have there. Show that other families with a similar profile live there. A family with young children will be interested in buildings where there are other residents with children of the same age, for example.
Remnants are not a problem but an opportunity. Close your enterprise sales cycle with a golden key. Your mission will be completed when the last key is delivered and at the signing of the last contract. And then we started a new challenge, with new ventures.
At Aqua we have several solutions to help with sales, from the launch phase to the remaining ones. See more information by visiting mtmis islamabad, interactive catalog of projects.
Do you have any extra tips? Want help selling your detached properties? Talk to us.