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When you buy a house, you expect to get white goods, a toilet and a shower as part of the package.
But if you buy the apartments at Slemdal in Oslo, you also get something else.
– In 2024, the money will not come from the sky. You have to work for it. There is a lot of competition in this sector. You have to be creative, says real estate developer Tor-Erik Kristiansen.
He has used a creative way to attract buyers to the three apartments, which have a price tag between NOK 21.9 and 35 million.
The first two Porsche buyers will receive a value of NOK 1.2 million.
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LOKKE: – The goal is to get people to come to the show and show how nice the project is. He doesn’t get money to pay in advertisements, says real estate developer Tor-Erik Kristiansen.
– The market is heavier
New home sales have fallen in recent years, with 2023 the same the weakest year on record for sale and commission.
In the first half of 2024, commissioning was at its lowest level. At the same time, new house prices have also increased 7.2 percent from 2023 to 2024.
Rising interest rates make it more difficult for mortgage customers to get loans, as they have to endure an interest rate increase of three percent.
On the other hand, builders are struggling with higher borrowing costs and rising construction costs.
This is the reason why Kristiansen is now trying to cheat with Porsche.
– The market is heavier than it was in 2020. We want to make people come to the show by “spoiling” a little with two cars and make it a little interesting, he says.
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New home sales are at rock bottom: – Very worrying
Drowning in the crowd
Kristiansen is the general manager of Real Estate Holding AS, Sectra Eiendomsutvikling and Prosjekt Bygg Entreprenør AS.
This is the company that has been announced for the first time as a shareholder with a 40 percent stake in Fahlstrøm Utvikling AS, which is responsible for the development of the apartments.
Kristiansen explains that the campaign is part of a strategy to stand out in a challenging market.
MORE: Real estate developer Tor-Erik Kristiansen hopes the luxury car offering will attract more buyers.
Photo: Anna Jakobsen
– Autumn is a heavier time for house sales, and we are experiencing a slight reduction in the amount of housing available. To raise interest, we want to up the “game” a little with this offer, he says.
He hopes this will get more people to come to the screening.
The goal is to get a quick trade.
Dealing with unsold houses can be expensive.
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NOK 375,000 per month
Kristiansen is chairman of Partner Property AS, which built six houses on a plot overlooking Ullern in Oslo.
E24 wrote in January about the six houses announced for sale at the end of 2021.
By January 20, 2024, three of the houses were sold, and the rest made a huge loss with a building loan interest of NOK 125,000 per month per house.
To attract customers, prices were lowered, with additions such as free parking spaces that would normally cost NOK 450,000.
Then they tried to attract buyers of houses with Fiat, to the value of NOK 300,000, if one was looking up NOK 18.9 million for one of the homes.
– We got a lot of buzz around the Fiat scheme and we got a lot more clicks on the ad than we would have if we had introduced the car. But it does not fit Fiat in this price, he says about the apartments for NOK 21.9-35 million.
READ IN: A 30-year-old bought a house for 20 million
“Toxic Cocktail”
To E24 Lars Jacob Hiim, director of Boligproduktorenes Forening, described the situation in January as a combination of a slow market and high costs as a “toxic cocktail” for the industry.
Many developers rejected new projects for fear of unsold houses, which added to the housing shortage.
– Then we end up in a situation where both our users and the builders are sitting on the fence. It is very unfortunate in a situation where we are already building far too few homes, he said.
More trends now
Kristiansen is optimistic about the future of the housing market.
– When interest rates were rising, it was very difficult to sell a home. Now that we are seeing that interest rates are going down soon, customers are seeing that brighter times are ahead, he says.
He says he is aware that there is more movement in the market now than there was a year ago. It is hoped that the flats will be sold before Christmas.
– It is not as bad to sell a house now as it was a year ago, he says.
Kristiansen is hoping for an interest rate cut before Christmas.
– But now it looks like it won’t arrive until March, but we’ll see then. We hope to have a Christmas present, he says.
2024-11-23 11:32:00
#Intense #competition #home #buyers #Giving #Porsche #exchange
What are the potential ethical dilemmas that real estate developers face when utilizing such high-value incentives to sell properties?
This article presents an interesting case study of a real estate developer using unconventional tactics to sell luxury homes in a challenging market. Here are some interview questions based on the article, categorized by theme:
**1. The Housing Market Context:**
* **The article mentions a “toxic cocktail” of a slow market and high costs impacting the real estate industry. What are the primary factors contributing to this situation, in your opinion, and how are they affecting both buyers and sellers?**
* ** Do you agree with the developer’s assessment that the market is improving, and what indicators are you looking at to support your view?**
**2. The Porsche Incentive:**
* **What are your thoughts on this specific marketing strategy? Is offering a luxury car an effective way to attract buyers in the current market, or could it be perceived as gimmicky?**
* **Could this tactic set a dangerous precedent where developers feel pressured to offer increasingly extravagant incentives to sell properties?**
* **What ethical considerations might arise from offering this kind of incentive? For example, could it create an unfair advantage for wealthier buyers?**
**3. The Role of Interest Rates:**
* **The article mentions the developer’s hope for an interest rate cut. How significantly do you think interest rates impact the housing market, and what are your predictions for future rate changes?**
* **What advice would you give to potential homebuyers who are uncertain about making a purchase due to economic volatility and interest rate fluctuations?**
**4. Broader Industry Trends:**
* **The article highlights the issue of a housing shortage. What steps can be taken to address this issue both in the short and long term?**
* **How do you see the role of technology and innovation changing the way homes are bought and sold in the future?**
* **What are some of the biggest challenges and opportunities facing the real estate industry today?**
These questions are designed to encourage insightful discussion and explore the various perspectives surrounding this interesting story. Remember to adapt them based on the specific focus and context of your interview.
