“More of a trickle than a torrent” – the words of Nationwide’s chief economist Robert Gardner describing the UK housing market to The Guardian this month. With subdued economic activity and pressure on household budgets, housebuilders are pushing part-exchange schemes in a bid to sell new homes and make bigger profits.
It’s nothing new. Barratt Homes have offered it as a sales scheme for over 40 years. In a market where properties are taking longer to sell, it enables the buyer of a new build to secure their chosen plot without having to hang around waiting for a buyer to scoop up their existing home. It also allows them to time a ‘guaranteed’ move, whether they need the keys in time for a new school term or the start of a new job.
But there’s still a lot of confusion around the subject. Many homebuyers worry they won’t get anywhere close to market value, or wonder whether they have to actually reserve a new property before they receive a valuation.
What about part-exchange? Clearing the confusion
“With so many different schemes, confusion is inevitable,” John Jarvis, MD of Property Perspective tells us. “The message to potential buyers needs to be ‘we will buy or find a buyer for your existing property at full market value and you will save all estate agency fees.” John’s company specialises in new home and part-exchange schemes, offering free training to its housebuilder clients and site sales staff to clarify this.
The MD has seen this scepticism among homebuyers first-hand. “The biggest area of difficulty is early mistrust is that the offer or marketing price will be lower to ensure a quick sale,” he explains. “This is driven by estate agents giving inflated valuations to gain an instruction. In reality, most properties are marketed for a number of months with an average of two price reductions before attracting offers. With part-exchange, however, the offer will reflect what the homeowner will achieve – there’s a perceived difference but the final result will be that both figures will be very close.”
How to sell part-exchange/ assisted move schemes
Many housebuilders solely offer assisted moves, where homebuyers can purchase a property at any price that’s not necessarily already on the market. Whichever you’re promoting, both schemes come with a multitude of benefits for homebuyers. The biggest challenge is relaying them to customers.
Anyone with a house to sell and is looking to move will have a few hurdles to overcome. Busy lives, hefty selling costs and estate agent fees can create whopping headaches. If you want to sell more homes, you need to take away these hassles. Here are a few ways to do just that:
- Find potential buyers where they are – and offer them something valuable
Traditionally these will live in a three-to-five mile radius of a development and for part-exchange, you’ll normally want to sell a property 30 to 40% higher in value. Our online valuation tools provide a simple solution to this: homebuyers can get an instant valuation of their current home by quickly entering a few details, so that you can capture their data and provide them with the perfect part-exchange offer. Our all-in-one calculator will even show them how much they could spend on a new home.
- Understanding home buyer pain points
Anyone selling a home and buying a new one wants to save three things: time, money and effort. Whether you’re sharing a monthly newsletter or hitting send on a tweet, always have this in mind. John’s advice is to create benefits-led marketing that will quash any doubts created from confusion in the part-exchange market:
“If a new plot is ready, emphasise the speed of the move for customers. If you can make it measurable, even better – can they move in in four to six weeks time? Tell them. Be sure to shout about the cost benefits, the fact there are no agent fees to pay and no broken chains at the last minute.”
- Know your worth and show your firm’s passion
When you know you’re offering genuine value, convenience and a peace of mind to customers, marketing comes easily. Housebuilders are tackling a key issue in the housing market: existing homeowners are struggling to sell properties and move up the chain and builders are seeing subdued sales.
Part-exchange schemes are win-win – inject this passion and honesty into all of your marketing efforts and watch your sales edge closer to ‘torrent’ status, rather than a trickle. Get in touch to find out how we can help sell more part-exchange/assisted move schemes.