Among those who are considering the sale of real estate,many have needs such as"wanting to convert to cash as quickly as possible," "wanting to reduce brokerage fees," and "wanting to save the trouble of handling viewings.
For such people, areal estate purchase resaleagent is a very effective option.
However, many people have questions such as "What exactly is a purchase resale agency?", "How is it different from a conventional agency?", and "What are the advantages and disadvantages of using it?
In this article, based on our many years of experience in the real estate industry as INA&Associates, we will provide detailed explanations of useful information for the general public, from how real estate purchase resale agents work to how to choose one.
We hope you will find this information useful when considering the use of real estate purchase resale agents as a new option for selling real estate.
Basic Concept of Real Estate Purchase Reseller
Definition and Role of a Real Estate Purchase Reseller
A realestatepurchase reselleris a real estate company that purchases real estate directly from individuals or corporations, renovates or remodels it as necessary, and then resells it to third parties.
This business model has characteristics that are fundamentally different from traditional brokerage operations.
The main role of a buyer/reselleris toincrease liquidityandmaximize value inthe real estate market.
Even for older properties or those with location challenges, they promote the effective use of real estate by using their expertise and technology to renovate and resell properties with higher market value.
Another important feature is that thepurchase and resale agentbears theinventoryrisk.
Since ownership is transferred when a property is purchased, the operator bears various risks, such as changes in market trends and unexpected repair costs.
As compensation for this risk-bearing, the purchase price is generally set at a certain level lower than the market price.
Fundamental difference from a conventional intermediary
Understanding the differences between a real estate purchase and resale agent and a traditional brokerage is critical to selecting the appropriate sales method.
The following table summarizes the key differences.
|
Item
|
Purchase and resale agency
|
Intermediary
|
|
Transaction form
|
Direct purchase (vendor is the buyer)
|
Brokerage (brokerage of sale to a third party)
|
|
Period of sale
|
Immediate to about 1 week
|
About 3 to 6 months
|
|
Sale price
|
Approx. 70-80% of market price
|
Close to market price
|
|
Commission fee
|
Not required
|
Brokerage fee (3% + 60,000 yen + consumption tax)
|
|
Pre-viewing
|
Not required
|
Necessary
|
|
Liability for non-conformity to contract
|
Often exempted
|
Seller bears responsibility
|
|
Timing of encashment
|
Simultaneous with settlement
|
After the buyer's mortgage loan approval
|
The brokeracts asa bridge between the seller and the buyerand aims to sell the property at the highest possible price.
On the other hand, a purchase and resale agentacquires the propertyas the ultimate buyerand conducts the business at its own risk.
This fundamental difference creates differences in transaction terms and procedures.
Position in the Industry and Market Size
According to statistics from the Ministry of Land, Infrastructure, Transport and Tourism, the percentage of purchase and resale in the existing home distribution market is increasing every year.
Particularly in the Tokyo metropolitan area, purchase and resale accounts for approximately 15-20% of all existing condominium transactions, and thus plays an important role in the real estate distribution market.
Behind the increase in the number of purchase and resale agents are the following changes in the market environment.
Asthe housing stockcontinues toage, there is a growing need to create new value by renovating older properties to suit modern lifestyles.
Especially in urban areas, a business model has been established for renovating and reselling well-located used properties.
Anotherimportant factor is thediversification of consumer values.
By responding to the needs of both "sellers who value quick cash" and "buyers who want renovated properties," buyers and resellers have established a unique position in the market.
Changes in the financial environment are also havingan impact.
As interest in real estate investment grows amid a persistently low interest rate environment, more companies are entering the purchase-and-resale business.
Financial institutions are also becoming more aggressive in their lending stance toward the purchase-and-resale business, which is encouraging business expansion.
Structure and Process of Purchase and Resale
Overall flow from purchase to resale
The purchase-and-resale businessconsists of three main phases:acquisition of properties,renovation to enhance their value, andresale to the market.
The detailed process for each stage is explained below.
Phase 1: Property Acquisition Process
The acquisition of a property by a purchase and resale company proceeds in the following steps.
In theappraisal and investigationphase, the subject property is comprehensively evaluated in terms of its location, building condition, legal restrictions, market trends, and other factors.
An important part of this stage isto accurately calculate theestimated resale valueandestimated renovation costs.
Experienced buyers and resellers utilize their own databases and expertise to perform highly accurate assessments.
The following factors are considered indetermining the purchase price
-Assumed resale value
-Renovation and refurbishment costs
- Miscellaneous expenses during the holding period (property taxes, management fees, etc.)
- Sales activity expenses
-Appropriate business profit
Taking all of these factors into consideration, thepurchase price is generally set at70-85% of the market price.
Contracts and settlementsare quickly proceeded with as soon as an agreement is reached with the seller.
In most cases, it takes one to two weeks from appraisal to settlement, and the seller receives cash.
Phase 2: Repairs and Renovations to Increase Value
The post-purchase renovation processis the core ofvalue-addedcreation inthe purchase and resale business.
In formulating the renovation plan, the target buyer demographic is clarified and the details of the renovation are determined according to their needs.
For example, when targeting families, we will emphasize functionality and safety, while for singles, we will focus on design and convenience.
In implementing the construction work, the following types of renovations are typically undertaken
-Upgrading of water facilities (kitchen, bathroom, washbasin, toilet)
- Complete interior renewal (wallpaper, flooring, lighting fixtures)
- Floor plan changes (reconfiguration of space by removing or building new walls)
- Renewal of facilities (water heater, air conditioner, intercom, etc.)
-Exterior improvements (exterior wall painting, balcony renovation, etc.)
Quality controlis an important factor in the success of a project.
Ensuring construction quality and adherence to the construction schedule will ensure that the project proceeds as planned.
Phase 3: Resale activities to the market
Appropriate pricingandeffective salesstrategies are important forresale activities after the completion of renovation.
Inpricing, the appropriate sales price is determined based on a comprehensive analysis of the property's value after renovation, the surrounding market price, and market trends.
Precise pricing based on market sense is required, as too high a price setting will prolong the sales period and too low a price setting will worsen profitability.
Sales activitiesinclude posting on real estate portal sites, providing information to brokers, and creating a model room-like viewing environment.
We aim for early sales by effectively promoting the property's appeal, which has been improved by the renovations.
Price Determination Mechanism and Basis of Calculation
The purchase price determination process for purchase and resale agents is based ona combination ofscientificanalysis andempirical judgment.
Purchase Price Calculation Method
The purchase price is calculated using the following formula
Purchase price = estimated resale price - renovation costs - overhead costs - reasonable profit
Theestimated resaleprice is calculated based on a comprehensive analysis of similar properties, current market trends, location characteristics, and other factors.
This analysis utilizes the expertise of personnel with professional qualifications, such as real estate appraisers and real estate transaction specialists.
In estimatingrenovationcosts, the required construction work and costs are calculated in detail based on the results of a survey of the building's current conditions.
Experienced purchase and resale agents will utilize past construction performance data to provide highly accurate cost estimates.
Overhead costsinclude the following items.
| Cost items |
Contents |
| Fixed costs during the holding period |
Property tax, city planning tax, management fee, and reserve for repairs |
| Financing costs |
Procurement cost of purchase funds, interest expenses |
| Selling expenses |
Advertising expenses, brokerage fees, registration fees |
| Others |
Insurance premiums, tax accountant fees, various procedural costs |
Resale Price Setting Strategy
In setting the resale price, itis important to strike a balance betweenmarket competitivenessandprofitability.
Competitive property analysis involvesa detailed study of sales conditions, price trends, and sales periods of similar properties in the same area.
This analysis will identify the appropriate price range and points of differentiation.
In establishingtarget customers, we identify the most appealing customer segments based on location characteristics, property characteristics, and renovation details.
By setting prices that match the needs and purchasing power of target customers, efficient sales can be achieved.
Strategic Role of Renovation and Remodeling
In the purchase and resale business, renovation and remodelingare positioned as an important means of creatingadded value, rather thansimplyrestoring the property to its original condition.
Responding to modern lifestyles
In order to achieve the functionality and comfort demanded by modern homebuyers, the following renovations are emphasized
Adoption of an open kitchen topromote family communication and create a living space with a sense of openness.
The change from a traditional freestanding kitchen to a layout that integrates the living and dining areas has been particularly well received by families.
In enhancing storage space, we develop storage plans that can accommodate today's diverse lifestyle products.
Walk-in closets, pantries, and living room storage are effectively arranged to create a neat and clean living environment.
To accommodate telework, securing a workspace suitable for telecommuting is also an important factor.
Spaces must be created to accommodate new work styles, such as a separate study or a work corner in the corner of the living room.
Energy Conservation and Environmental Consideration
Improved insulation performanceimproves living comfort and reduces utility costs.
Double-glazing of windows, the addition of heat insulating materials, and improved airtightness provide a comfortable indoor environment throughout the year.
Energy-saving equipmentwill reduce running costs through the use of LED lighting, high-efficiency water heaters, and energy-efficient air conditioners.
These capital investments provide long-term benefits to purchasers and contribute to improving the competitiveness of the property.
Combination of design and functionality
Through the adoption ofmoderndesign, we create attractive living spaces that do not show the age of the building.
While incorporating trends, it is important to choose a design that will not become boring over the long term.
We incorporate the concept ofuniversaldesign to create living environments that are easy to use regardless of age or physical ability.
By eliminating steps, installing handrails, and ensuring wide corridor widths, we provide housing that can be lived in with peace of mind well into the future.
Advantages and disadvantages of purchase and resale
Merits from the seller's point of view
For sellers who use a real estate purchase and resale agency,there areclearadvantages, including
Quick turnaround to cash
The greatest merit isthe short time from sale to cash.
In a traditional sale by intermediary, it generally takes 3-6 months from the search for a buyer to contract, mortgage approval, and settlement.
On the other hand, when using a purchase and resale agent, the process from appraisal to settlementcan be completed inabout one to two weeks, making it possible to respond to sudden demand for funds.
This rapidity is especially valuable for sellers in the following situations
In the case ofreal estate acquisition by inheritance, early conversion to cash may be required due to inheritance tax payment deadlines or the need to partition the estate.
The use of a purchase and resale agent can facilitate the inheritance process.
In the case of relocationdue to job transfer or change of occupation, securing funds to purchase a new residence and moving expenses are urgent needs.
By shortening the sale period, a planned change of residence becomes possible.
If you need to raise funds foryour business, you can quickly convert real estate into cash and raise funds without missing out on business opportunities.
Reduction of burdens associated with the sale
Theelimination of the need to respond to previewsis a major advantage, especially when selling a property that is being lived in.
When selling through an intermediary, multiple viewings are required, mainly on weekends, and this can have a significant impact on daily life.
In the case of a purchase and resale agency, there is no such burden because the sale is completed only by an appraisal by the agency.
The exemption from liability for non-conformity to contractavoids the risk of problems after the sale.
In conventional sales, the seller is liable for a certain period of time for hidden defects in the property, but in transactions with purchase-and-resale vendors, this liability is often exempted, providing peace of mind after the sale.
Theelimination of brokerage feesreduces the cost of sale.
Since the brokerage fee is "sale price x 3% + 60,000 yen + consumption tax," the higher the price of the property, the greater the savings.
Transaction with high certainty
The buyer's mortgage examination riskcan beavoided.
In a sale by intermediary, there is a risk that the buyer's mortgage examination will be denied after the contract is signed, but a purchase and resale agent buys the property for cash or with its own business funds, so there is no such risk.
It is also characterized bybeing less susceptible to market trends.
In the case of sale by intermediary, there is a risk of market price decline during the sale period, but in the case of purchase, the price is fixed at the time of appraisal and is not affected by market fluctuations.
Demerit from the seller's side
On the other hand, the followingdisadvantagesexist in theuse of buyers and resellers.
Restrictions on sale price
The biggest disadvantageis that the sale price is below the market price.
Typically, the purchase priceis set at70-85% of themarket price.
This price difference is set as compensation for the risk and business costs borne by the buyer/reseller.
A detailed analysis of the factors contributing to the price difference consists of the following
|
Item
|
Percentage of market price
|
|
Repair/renovation costs
|
10-15% of the total
|
|
Miscellaneous expenses during holding period
|
2～3％ (% of market value)
|
|
Sales activity expenses
|
2～3％ (2～3％)
|
|
Business risk and reasonable profit
|
5～10％ Total reduction
|
|
Total reduction
|
19-31% Total reduction
|
It is important to evaluatethis price difference interms ofreturn on investment.
The seller must make the best choice based on a comprehensive evaluation of the price difference and the benefits of quick cash conversion, simplified procedures, and risk avoidance.
Limitations of Choice
Another disadvantage is that the choices ofbuyersare more limited than those of intermediaries.
Not all real estate companies are in the purchase and resale business, so there may not be many options in some areas.
Restrictions based on the type of property alsoexist.
Since purchase and resale companies focus on properties that have good prospects for resale, they may refuse to purchase properties depending on the location and condition of the building.
Advantages from the Buyer's Perspective
There arealso the followingadvantages forbuyers of purchase and resale properties.
Acquisition of renovated properties
The ability to acquire a property in aready-to-move-incondition is a major advantage for buyers.
Since the water facilities, interior, and equipment have been updated to new or like-new condition, the buyer can enjoy a comfortable living environment immediately after purchase.
You will havea modern living environment.
Even if the property is older, it is equipped with the latest facilities and modern design, so you can enjoy a comfortable living environment similar to that of a newly built property.
Saving on renovation costs is anotherimportant advantage.
Compared to renovations conducted by individuals, purchase and resale agentsutilize economies ofscaleto conduct efficient renovations, resulting in a reduced burden on the buyer.
Quality Assurance
A certain level of quality is assuredthrough construction by specialized contractors.
Since purchase and resale companies are concerned with their own credibility, they thoroughly control the quality of construction, providing a sense of security compared to remodeling done by individuals.
After-sales servicecan also be expected.
Many purchase and resale companies offer post-sale defect handling and maintenance services, providing peace of mind after the purchase.
Disadvantages from the Buyer's Perspective
On the other hand, the followingdisadvantagesfor buyersshould be considered
Restrictions on customization
A disadvantage is that it is difficult tocustomize the product according to personal preferences.
Buyers and resellers will make modifications to suit their general preferences in order to appeal to a larger number of potential buyers.
As a result, they may not be able to accommodate the particular needs and preferences of individuals.
Future modificationcosts must also be considered.
If you want to change the floor plan or facilities after purchase, you will need to remove the new facilities and re-construct them, which may be more expensive.
Price Premium
The pricedifference froma new propertymay not be as large as expected.
For properties in better locations, the price difference from new construction may be smaller as a result of added renovation costs.
Comparison with the surrounding market price is alsoimportant.
Compared to similar properties in the same area, it is necessary to carefully determine whether the price increase for renovation costs is appropriate.
Overall evaluation of advantages and disadvantages
When considering the use of purchase and resale, it is important to make a comprehensive judgment based on thefollowingevaluation criteria.
Time value evaluation
Evaluate thetimebenefitinterms of monetary value.
Opportunity profit obtained by early conversion to cash, time cost reduction effects such as response to previews, and mental burden reduction effects are comprehensively evaluated and compared with the price difference.
Evaluation of Risk Tolerance
Appropriate evaluation ofrisk aversionvalue.
We evaluate the value of the exemption from contractual non-conformity liability, avoidance of buyer's mortgage screening risk, and avoidance of market price fluctuation risk, in accordance with the seller's risk tolerance.
Consideration of Individual Circumstances
Theseller's individual circumstancesmust be fully considered in making a decision.
We will select the most appropriate method of sale, comprehensively taking into account the urgency of the need for funds, the burden of property maintenance and management, tax considerations, and other factors.
How to Select a Purchase and Resale Agent
How to identify a reliable vendor
Choosing a purchase and resale agent is an important factor in the success of a transaction.
Thefollowingevaluation criteriashould be used to carefully select a vendor
Evaluation of business performance and experience
Confirmation of business experienceis the basis for selecting a vendor.
We will select a vendor with a stable business foundation by confirming quantitative results such as the number of purchases per year, transaction value, and years in business.
In evaluating expertise, wewill make a comprehensive judgment based on transaction experience in the target area, track record in dealing with different types of properties, and renovation technical capabilities.
It is important to select a contractor that understands the characteristics of the area and can develop an appropriate renovation plan.
By checkingpast transactions,you can get a concrete grasp of a contractor's capabilities.
Through information such as before/after photos, refurbishment details, and sales records, we can evaluate a builder's technical capabilities and sense of style.
Confirmation of financial soundness
We evaluate the stability of the builder by confirming thecapital and financial condition of thebuilder.
A purchase requires substantial financial resources, and a vendor with a weak financial base is at risk of shorting funds in the middle of a transaction.
Relationships with financial institutions are anotherimportant evaluation factor.
The reliability of a vendor can be determined by checking its loan track record and credit standing with major financial institutions.
Insurance coverageshould also be checked.
Selecting a builder that has appropriate insurance coverage, such as business liability insurance and construction insurance, will ensure that the builder is prepared for any accidents or problems that may occur.
Confirmation of Legal Compliance
Confirmation of thebuilding lot and building transaction business license isa must.
Check the license number, number of renewals, and history of administrative penalties with the Ministry of Land, Infrastructure, Transport and Tourism's Negative Information Retrieval System to select a builder that is conducting proper business.
The existence of aconstruction businesslicense is also important.
Since a construction business license is required for large-scale renovations, a contractor with a license is more reliable.
By checkingmembership in industry associations, you can evaluate the reliability of the contractor.
Membership in major organizations such as the National Federation of Building Lots and Buildings Transaction Business Associations and the Real Estate Distribution Management Association is proof of a certain level of reliability.
Assessment Price Validity Evaluation
Comparative assessment by multiple vendors
We will obtain appraisals from about3 to 5vendors and evaluate the appropriateness of the prices.
For vendors who present extremely high or low assessments, it is necessary to confirm the basis for their assessments in detail.
By asking for an explanation of thebasis for the appraisal, you can evaluate the expertise of the vendor.
A vendor who can provide concrete evidence such as contract examples of similar properties, renovation plans, and estimated resale prices can be judged to be highly reliable.
Confirm the contents of theappraisal reportin detail.
An appraisal report that clearly states the property's evaluation points, planned refurbishment areas, and anticipated issues shows the high level of expertise of the builder.
Comparative analysis with market value
We verify the appropriateness of the appraisal value by conducting our own research on thesurrounding market.
We utilize publicly available information such as real estate portal sites, official land prices, and roadside land prices to ascertain objective price levels.
We investigatecontracted cases of similar properties toverify the consistency with the assessed value.
By comparing the contracted prices of properties with similar building age, area, location, etc., we can determine the appropriateness of the appraisal value.
Confirmation of detailed contract conditions
Purchase Price and Payment Terms
Confirmation ofprice finality.
Clarify whether the assessed price is a fixed price or if it is subject to change at the time of contract.
We will also confirm the specific conditions, if any, under which the price may be changed.
Confirm details ofwhen andhowpayment will be made.
Clarify the amount of the deposit, whether or not there is an interim payment, and the timing of payment of the remaining balance, and confirm that there are no obstacles to the financial plan.
Clarify thedivision of expenses.
Confirm in advance the division of burdens for registration fees, stamp fees, reimbursement of property taxes, etc., to avoid unexpected burdens.
Contract Cancellation Conditions and Scope of Liability
Confirmcontract cancellationconditions in detail.
Clarify the conditions for cancellation for the buyer's convenience, the seller's right to cancel, and the deadline for releasing the deposit, and understand the rights and obligations of both parties.
Confirm the scope of liability fornon-conformity to the contract.
Clarify the scope of indemnification, matters not indemnified, liability period, etc., and properly assess post-sale risks.
Agree on detaileddeliveryconditions.
We clarify the timing of delivery, the current condition of the property, disposal of leftover items, and the method of handing over the keys to ensure a smooth transaction.
Checklist for Selecting a Builder
The following checklist is used to conduct a comprehensive vendor evaluation.
| Evaluation Items |
Check Details |
Evaluation |
| Business performance |
Number of purchases per year, number of years in business |
○/△/× |
| Financial soundness |
Capital, relationship with financial institutions |
○/△/× |
| Legal compliance |
Licenses/permits obtained |
○/△/× |
| Appropriateness of appraisal |
Clarity of Basis of Assessment |
○/△/× |
| Contract terms |
Clarity of price and payment terms |
○/△/× |
| Quality of response |
Explanation politeness, response |
○/△/× |
| After-sales service |
Post-sale support system |
○/△/× |
Characteristics of vendors you should be aware of
Characteristics of vendors to avoid
Be wary of vendors that offerextremely high appraisalprices.
Trouble such as lowering the price or unilaterally canceling the contract after signing may occur.
A vendor whocannot clearly explain the basis for the appraisalis questionable in terms of expertise.
There is a possibility that they are conducting an appropriate appraisal, and there is a problem with the safety of the transaction.
Be wary of vendors whorush you into a contract.
They may force you to sign a contract under unfavorable conditions without giving you sufficient time to consider.
A vendor that engages inexcessive salesactivities may have performance problems.
Frequent phone calls and pushy sales visits raise questions about sound business operations.
Measures to Avoid Trouble
Be sure to confirm thedetails of the contract.
If there are any unclear clauses, be sure to confirm them before signing the contract, and avoid signing a contract with contents you do not understand.
It is also effective to seek athird party'sopinion.
Consult with acquaintances, tax accountants, lawyers, and other experts who are knowledgeable about real estate to obtain an objective opinion.
Ensure acalm decision-makingperiod.
Even if you are asked to make an immediate decision, allow at least several days for consideration and make a calm decision.
Points for identifying a good vendor
Characteristics of vendors that should be actively chosen
A vendor that providestransparentexplanations is trustworthy.
A commitment to customer understanding by providing an uncluttered explanation of the basis for the assessment, business plan, risk factors, etc., is a characteristic of a good contractor.
A builder that conductscommunity-basedsales has a deep understanding of local characteristics and is able to develop appropriate assessments and renovation plans.
A track record of continuing business in the community over a long period of time is proof of reliability.
A good after-sales service is alsoan important evaluation point.
Companies that provide comprehensive services, such as post-sale tax advice and assistance in finding the next home, tend to have high levels of customer satisfaction.
Select a builder that demonstratesa high level of technical expertise.
A builder that can provide high-quality renovations with professional human resources, such as architects and interior coordinators, can be expected to improve resale prices and, consequently, purchase prices.
Conclusion
Real estate purchase resale agentsare playing an important role in the real estate market as anew alternativeto traditional brokerage sales.
Based on the content explained in this article, we reiterate the following key points.
Key Points of Using Purchase Resale Agencies
Rapid cashconversion andsimplified proceduresare the biggest advantages.
It takes only one to two weeks from appraisal to settlement, and avoids the burden of dealing with viewings and contractual non-conformity liability.
On the other hand, since the sale price will be 70-85% of the market value, itis important to properly evaluate thetrade-off against the time value.
The selection of a vendoris extremely important, and a reliable vendor should be selected based on a comprehensive evaluation of business performance, financial soundness, legal compliance, and appropriateness of the appraisal.
Obtaining assessments from multiple vendors and conducting detailed comparisons will help you achieve optimal transaction terms.
Consideration of individual circumstancesis the key to success.
Comprehensive consideration of the urgency of funding needs, property characteristics, tax considerations, future plans, etc., and comparison with a sale through an intermediary will allow you to select the most appropriate sales method.
Future Market Outlook
The real estate purchase and resale market isexpected to continue to grow on the back ofeffective utilization of housing stockanddiversifying consumer needs.
In particular, the expertise of purchase and resale agents is expected to be demonstrated in areas such as increasing the value of older properties, adapting to modern lifestyles, and improving energy-saving performance.
The use of technology isexpected to improve the accuracy of assessments, standardize construction quality, and increase the efficiency of sales activities.
Inaddition,from anESG (Environmental, Social, and Governance) perspective, the business has increasing social significance as it contributes to the creation of a sustainable housing stock.
Next Action Steps
If you are considering selling your real estate, we recommend that you proceed with the following steps
1.Grasp the current market price - Confirm property value using multiple assessment methods.
2.Clarify sale objectives and priorities - balance evaluation of time, price, and effort
3.Obtaining assessments from multiple vendors - Comparison of purchase price and expected brokerage price
4.Comprehensive judgment - Final decision based on merits and demerits
INA&Associates Inc. proposes the most appropriate sales method according to the individual circumstances of our customers.
We can meet a wide range of needs, from consultation regarding purchase and resale to sale through brokerage.
If you have any questions or concerns regarding the sale of real estate, please feel free to contact us.
Frequently asked questions
Q1. How is the purchase price determined?
A1.The purchase price is calculated by subtracting renovation costs, various expenses, and appropriate profit from the estimated resale price.
Specifically, the purchase price is determined based on the estimated resale value of the property, based on examples of similar properties in the surrounding area, an estimate of the cost of necessary renovation work, fixed costs during the holding period, and sales activity costs, all taken into consideration.
Generally, the price will be 70-85% of the market price, but it will vary depending on the condition of the property and its location.
Q2. Can I be refused to purchase the property?
A2.Yes, there is a possibility of refusal in the following cases.
The following are examples of situations in which we may refuse to purchase: properties in extremely poor locations, properties with severely damaged buildings that will require excessive renovation costs, properties that are difficult to resell due to legal restrictions, and special properties for which market demand cannot be expected.
However, we recommend that you consult with multiple vendors, as each vendor has its own criteria for judgment.
Q3. Can the price be changed after the contract is signed?
A3.If the contractor is appropriate, there is no unilateral price change after the contract is signed.
However, if a price change clause is included in the contract, or if a property inspection reveals serious defects that were not originally anticipated, price change discussions may take place.
It is important to always confirm the definiteness of the price and the conditions of the change before signing a contract.
Q4. Which should I choose, purchase or brokerage?
A4. The selection criteria are as follows
When purchase is suitable: Need to make cash as soon as possible, want to avoid the hassle of dealing with viewings, etc., do not want to be responsible for contractual non-conformity, and place importance on a secure sale.
When brokerage is suitable: Want to sell at the highest possible price, have enough time to sell, and want to maximize the appeal of the property.
It is important to make a decision based on comprehensive consideration of individual circumstances.
Q5. Are there any tax considerations?
A5.Transfer income tax may be imposed on the sale of real estate.
The tax treatment is the same for both purchase and brokerage, but the tax amount may vary depending on the difference in sale price.
It is also important to confirm whether or not the property meets the requirements for application of the 30 million yen special deduction for residential property and the special exception for replacement of property.
We recommend that you consult with a tax accountant or other specialist regarding taxation matters.