Selling property made easy: The ultimate tips for a successful sale

Please note: In Switzerland, most property purchases are financed with a mortgage, which typically covers around 80% of the purchase price. Usually, 15 percent of this is amortized over the first few years. This means the property remains about two-thirds debt-financed (by the bank). If you sell your property below its actual value, it reduces your remaining capital even more significantly, as you must first use the proceeds to pay off the mortgage.

A calculation example:
Mr. Meier buys a house for CHF 1 million and holds it for 10 years (with a mortgage of CHF 800,000, which amounts to CHF 700,000 after 10 years). Let's assume that the value of the property has risen to CHF 1.15 million by the time of sale.
Mr. Meier trusts the first real estate agent he finds, who estimates the value at CHF 1.05 million. The agent is able to sell the house within a few weeks at this price. Mr. Meier pays off the mortgage and is happy with the surplus.

If we compare this property sale with the best possible sale, the impact becomes clear:

Sale price: CHF 1.05 million
Mortgage repayment: CHF 0.7 million
Payout to Mr. Meier: CHF 0.35 million

Ideal sale:
Sale price: CHF 1.15 million
Mortgage repayment: CHF 0.7 million
Payout to Mr. Meier: CHF 0.45 million

Conclusion:
The additional return of one hundred thousand francs has a massive impact on your capital (+29%) and your yield.

In this article, we show you what you should keep in mind when selling property and what you should definitely avoid. The right approach is extremely important, as otherwise you could miss out on a significant amount of money.

You can also read about how Bestag can support you.

How to sell my property – step by step

Step 1: A reliable valuation

When selling a property, a sound valuation is essential to determine the optimal price and ensure a successful sales process. However, valuations can often vary widely.

Why do different valuations differ from one another?

Different valuation methods, missing or incorrect data points, and varying levels of market expertise mean that individual valuations can differ significantly. We therefore recommend obtaining multiple valuations so that you can identify major discrepancies and narrow down the actual value more accurately.

Which valuation methods are suitable?

We are assuming a standard property sale (house or apartment) here. In this case, the following two valuation methods are usually applied: the hedonic valuation and the real value method.

Hedonic valuations

The hedonic valuation is a statistical comparison method that records characteristics such as location, size, condition, and age of the property and compares them with properties that have already been sold. Since it is based on past sales data and the calculations vary depending on the provider, it is advisable to obtain several hedonic valuations. Hedonic valuations are the most common method for upcoming property sales.

Disadvantage: The appraiser records the data points and has a major influence on the valuation. Furthermore, the result is a value range of up to 20%, which can only be estimated more precisely by someone with local market knowledge.

Real value method

Here, the land value is added to the current value of the building. The land value takes into account factors such as the municipality's tax rate, comparative prices in similar locations, and proximity to the city. The current value of the building is determined by calculating the costs for a hypothetical new build, including ancillary costs and expenses for landscaping. Subsequently, a depreciation based on age and condition is deducted.

Disadvantage: Except for the land value, this method does not directly reflect the current market situation and is therefore only suitable for luxury properties or those with unique appeal.

Conclusion: How should I value my property?

To obtain a reliable valuation, you should consult several qualified real estate agents with local market expertise. Different perspectives and assessments help to determine a realistic price level.

It is also advisable to obtain hedonic valuations from a neutral provider. Hedonic valuations play an important role for banks as well, as they are typically used as the basis for granting mortgages.

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Step 2: Finding the best real estate agents for your property sale

In step one, you learned that you should obtain multiple valuations from locally specialized agents. But what should you look for when making your selection?

What makes a good real estate agent?

• Local specialization: Does your property fit the agent's portfolio? Have they sold comparable properties in the area? This allows them to estimate the value more accurately. Furthermore, they may already know potential buyers from previous sales.
• Comprehensive service: Check which services are included in the agent's offer. Comprehensive support from the creation of the sales dossier to the notary signature is ideal. Qualified agents can also take the burden off you regarding complex issues such as capital gains tax.
• Qualifications: Are they sufficiently qualified? Check the agent's professional background.
• Experience: An experienced agent knows the challenges involved in selling a property and stays calm under pressure. Based on their experience, they can also provide you with valuable sales tips (e.g., whether a small investment could add extra value).
• Sales dossier: Review your existing sales brochure. This document will be the first impression potential buyers have of your property. Is it attractively designed and does it contain all the relevant information? A professional and comprehensive sales brochure appeals to more people and builds trust.

Get to know the real estate agents personally

Once you have shortlisted several agents, invite them for a viewing. Feel free to let them know that you are seeking multiple opinions. While competition can lead to better offers, it also carries the risk of overvaluation. To prevent this, you should announce a bonus-malus compensation structure (more on this in step 3).
A viewing allows the agent to more accurately assess the condition and standard of the property. It also gives you the opportunity to meet the agent in person and ask any questions you may have.

Step 3: Brokerage contract

There are many different types of brokerage contracts, but they all have one thing in common: they primarily serve the interests of the agent, which are often contrary to your own.

Here, we look at three clauses you should examine closely. If you want to avoid any risk, we recommend having the brokerage contract reviewed by an independent professional.

Commission

The contract specifies which services are covered by the agreed commission. Pay close attention to any additional billable costs. Typically, the commission is between two and three percent and covers all expenses. You should also include a bonus-malus clause to financially motivate the agent to get the best possible result for you (more on this in the next chapter, mistake no. 4).

Minimum price

The minimum price clause states that the agent is entitled to their commission if they present a buyer willing to pay a pre-agreed minimum price. However, this minimum price can be significantly lower than the property's previously estimated value. Read this section very carefully. By the way: A minimum price in the contract can also be fair, provided it is identical to the estimated value.

Exclusivity

Take your time when choosing an agent. However, once you are certain, you should grant them an exclusive contract. In a competitive marketing scenario, agents might shy away from costs and effort for fear that another agent will close the deal first, leaving them empty-handed. With an exclusive contract, the agent is given a fair, time-limited opportunity. They will do everything in their power to close the sale.

Could you use an extra 100,000 francs?

In this expert guide from Bestag, you will learn about the common mistakes property owners make when selling—and how you can avoid them.

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Selling property - common mistakes

Many things can go wrong when selling a property. A list of every possible mistake would far exceed the scope of this article. Nevertheless, we would like to point out some of the most common errors and pitfalls.

Mistake #1: Selling it yourself

Selling a property yourself generally only makes sense if you are selling a condo in a development where several units have recently been sold, meaning you are familiar with the market prices. You must also be confident in handling all the tasks involved in the sale. Otherwise, a qualified local real estate agent will usually secure a better outcome for you, even after deducting their commission.

Mistake #2: Flat-fee agents

As the name suggests, flat-fee agents work for a fixed commission. When comparing flat-fee agents with traditional ones, you should look beyond just the costs and focus primarily on the expected net proceeds (the expected sale price minus the commission). It is also advisable to check the scope of services offered—with flat-fee agents, for example, you may be required to conduct viewings yourself.

Our conclusion on flat-fee agents: steer clear! This business model is designed to sell properties quickly and cheaply, without any real incentive to achieve the best price for you. If a higher sale price is achieved, the flat-fee agent gains nothing from it. So why would they go the extra mile for you?

Mistake #3: Using only one agent

Selling a property is easier the lower the price is set. If you only ask one agent for a valuation and then grant them the sales mandate, there is a very high risk of undervaluation.

An agent can speed up the sale and minimize their own effort by undervaluing the property. Therefore, you should always consult several agents and inform them that they are competing for the mandate.

Mistake #4: Lack of an incentive system (bonus-malus)

Create a financial incentive for the agent by including a bonus-malus clause in the contract. This has two advantages:

• If you have your property valued by several agents, there is a risk they will overvalue it just to win the contract. Linking a bonus-malus clause to the valuation reduces the risk of overvaluation, as the agent would otherwise risk a penalty on their commission.
• The bonus motivates the agent to get the absolute maximum for you. If they exceed the appraised price, they receive a share of the additional proceeds. This keeps them highly motivated to secure the best possible result for you.

Mistake #5: Disclosing too much information

To ensure your property is valued professionally and as accurately as possible, you should provide the agent with all necessary information and documents. There is one exception: do not mention a price—not your target price, not the original purchase price, not the valuation from other agents, and not the amount of your mortgage. These details can unnecessarily bias the valuation. Let the agent perform an unbiased assessment.

Mistake #6: Assuming a bidding process equals the highest sale price

It is a misconception that a bidding process always achieves the highest possible sale price. To run a successful bidding process, many things must be done correctly: the right starting price, the right target audience, a transparent process, etc. Otherwise, a bidding process can actually deter potential buyers.

Furthermore, a bidding process is only suitable for highly sought-after properties in prime locations that attract affluent buyers.

Why should you sell your property with Bestag?

In the previous chapters, you learned why the endeavor of "selling real estate in Switzerlandcan be complex. Mistakes made during the valuation, the selection of the real estate agent, or within the brokerage contract usually have far-reaching financial consequences for the seller.

To prevent exactly this, Bestag was founded. Bestag provides advisory support to property sellers right up to the notarization. This service is unique in Switzerland and is based on three pillars:

1. Data- and experience-based agent selection

To find the most suitable agents for your property sale, we draw on our database of all active agents, which is unique in Switzerland.

• Since 2017, we have analyzed over 500,000 property sales listings based on 15 data points (e.g., performance for sales in the area, managed portfolio, marketing time, actual price per square meter achieved, etc.).
• The data is continuously enriched. On the one hand with current sales listings, and on the other with our own experience: our team meets with a large number of agents every week. You should benefit from these insights too.
• Our specially developed algorithm identifies the three most suitable local agents for your property sale.
• We organize a viewing of your property by these three agents and accompany you personally.
• Thanks to the resulting competitive situation, you receive more attractive offers.

2. The most reliable valuation on the market

To provide you with the most reliable and realistic assessment possible, we obtain a total of five valuations from two sources:

• Three valuations from the most suitable agents:
  If the agents have been selected correctly, you benefit from their experience and market knowledge during the valuation. Normally, the agents value
• Two hedonic valuations:
  We carry out two hedonic valuations with the two leading valuation providers, IAZI and Wüest Partner. These are taken into account by banks when granting mortgages. In addition, outliers in the agent valuations can be identified.

The result for you is a transparent overview, which our local consultants will discuss with you.

Have we piqued your interest? Click here for our Online property valuation, which provides you with an initial point of reference.

3. Brokerage contract with performance-based compensation

As you read in the previous chapter, brokerage contracts are usually designed to favor the broker's interests. We reshape them – in your interest:

• Your client advisor identifies terms that are to your disadvantage and eliminates them.
• We incorporate a bonus-malus clause (performance-based compensation). If the broker sells your property above the previously agreed value, they receive a share of the surplus. If the sale occurs below the planned price, their commission is reduced. Furthermore: The sale only proceeds with your approval.
• Your client advisor handles the contract negotiations on your behalf.

Bestag has already overseen over 500 property sales – you benefit from the experience gained along the way.
And even after the brokerage contract is signed, your Bestag client advisor remains by your side until the sale is successfully completed. You have a neutral expert at your side at all times.