"Financial distress is still very much a reality in the current market, and, with inflation pressure pushing up interest rates and other rising costs taking their toll on consumers, we are likely to see distressed property sales last for a while longer," says Goslett. "Homeowners may find themselves in a situation where they are behind on their bond repayments and feel that they have no other choice but to lose their property. However, this is not the only option that they have."
While homeowners facing the thought of losing their home could feel isolated, they do not have to go it alone as there are trained professionals who can assist them in finding the best possible solution. "To avoid having their home repossessed by the bank that holds the bond, financially distressed homeowners can work with an agent who is a Certified Distressed Property Expert (CDPE). These agents will help the homeowner to take action, which is the best way to handle the situation. The worst thing that a homeowner could do is sit back and watch everything fall apart," Goslett adds.
According RE/MAX, approximately one in three South African homeowners could find themselves needing to sell their property to alleviate financial pressure. Considering that on average a property spends around 42 days on the market, financially distressed homeowners need to take decisive action as soon as possible to avoid the circumstances snowballing beyond their control.
"Often homeowners in financial distress delay making any decisions in the hope that something will change or they feel too ashamed to ask for help. The fact is, this will be more detrimental to their financial well-being in the long run and they should rather seek advice and follow the correct channels sooner rather than later," advises Goslett. "Once a homeowner recognises that they need to sell - they must act. A CDPE can assist them through the process of selling their home in a timely manner for the best possible market value."
According to Goslett, more than 500 RE/MAX agents countrywide have completed the CDPE course and are distressed property experts, equipped with the specific knowledge required to effectively handle the intricacies of distressed property sales. Offered exclusively to RE/MAX of Southern Africa agents, this has essentially ideally placed RE/MAX to assist homeowners who find themselves in distress. A CDPE can help a distressed homeowner to avoid the financial implications of having a property reposed.
"Homeowners who have made the choice to work with a CDPE will need to be as open and honest as possible with regards to their financial situation in order for the agent to gauge the urgency of the matter. Providing accurate information to the agent will allow them to determine how to proceed with the matter and what kind of time frame they have to sell the property. One of the objectives of the agent will be to keep an open communication channel with the bank to inform them of any offers or signed sales agreements that the agent receives," explains Goslett.
He adds that a vital aspect when it comes to selling the distressed property is using the correct marketing approach and pricing it correctly. Goslett says that as with any type of property sale, correctly pricing a property at fair market value is essential to attracting the right buyers to the home. "Excessively priced properties will take far longer to sell, and time is unfortunately not a luxury that distressed homeowners have. RE/MAX CDPE agents who sell distressed properties have managed to achieve, on average, 91% of the asking price," says Goslett.
"Using a specifically trained agent who deals with distressed property sales can be a valuable asset to homeowners looking for alternative solutions to challenging financial circumstances. The agent can guide the homeowner through effective negotiation of each offer they receive to get the highest price and ensure the best possible solution for the seller as well as the bank," he concludes.
