Mietverwaltung Online

Here’s how to sell jewelry to people who appreciate handmade artistry, by displaying your pieces in art galleries. This can be an especially good way to sell your higher-priced, one-off items.

Customers who shop in galleries are usually prepared to pay a premium for their purchases, and they are often seeking unique artwork that they won’t find elsewhere. Gallery owners and their staff know how to sell jewelry and other art to this type of clientele, and they are are constantly looking for interesting new handcrafts to display.

How to Choose the Best Galleries for Your Jewelry

Galleries often focus on a particular style, niche, or medium of artwork. If you find one that specializes in a theme, material, or era that characterizes your jewelry, it could be an excellent channel for selling your art.

For instance, if you make dichroic glass jewelry, look for galleries that focus on glass art. Also be sure to get a good idea of the gallery’s personality. While a conservative establishment would probably know how to sell jewelry in a Victorian theme, they may have trouble selling trendy body jewelry.

How to Locate Prospective Galleries

1) Check your local listings for any likely galleries in your area. If they’re close enough, you can stop in anonymously before making any appointments to show them your jewelry.

2) Look in the classified ads of art magazines to find advertisements for galleries. Some art publications also publish annual gallery listings.

3) When your friends and family travel, ask them to keep an eye out for any galleries that seem compatible with your jewelry line. Your loved ones are usually happy to step into a likely establishment and pick up a business card for you to follow up on.

4) Do some Internet searches for galleries that pertain to your style of jewelry. For best search results, use quotes in your search terms – such as:

„gallery“ + „glass art“.

Take a close look at the online presence of these galleries to determine whether they feel like places that know how to sell jewelry from your product line. Check for a section of their website regarding their preferred procedure for artists to contact them about carrying their work.

5) To show your work to a gallery in your local area, call first and set an appointment with the person in charge of accepting new work. If they say they’re not accepting anything new at this time, thank them politely and consider the next one on your list.

6) For galleries farther afield, send a brief email to the gallery owner, introducing yourself and stating why you think your jewelry fits well with their gallery. Include a link to your website so they can take a look at your work when they have time, to decide whether or how to sell jewelry like the pieces on your site. If you don’t hear back from them within two weeks, call the owner to follow up.

How to Learn More About Your Prospective Galleries

Investigate the business side of these galleries in more detail. Ensure that they have a good marketing plan, and that their items do sell within an acceptable period of time. When talking to a gallery owner regarding how to sell jewelry from your collection, here are some things to find out:

1) What kind of advertising do they do? What special events do they host, and what promotional mailings go out to their clients?

2) Will they give you the names of a few of their other artists whom you can call or email to find out their experiences with this gallery?

3) Do they buy art on a wholesale basis, or take items on commission? What percentage of the retail sale price does the gallery pay the artist?

4) If they work on consignment, how often does the gallery send out payments to the artists?

5) Will they have special promotions or exhibitions of your jewelry?

6) Is the gallery staff well educated in the work of the artists whose work they carry? It’s the salespeople’s job to know how to sell jewelry as well as how to sell the artist to their clientele.

Immobilienmakler Heidelberg

Makler Heidelberg

The National Association of Realtors is the largest organization set up to enhance the abilities and opportunities for realtors nationwide. They promote professionalism, ethical practices and preservation of the right to own property. This is important to you because it provides the quality service to you that as a home buyer or seller you deserve.

With the increasingly difficult steps that occur in a real estate transaction, it is all that much more important to have a professional handling the legal contracts, negotiations and more.

The Internet has been an open portal to increasing the sophistication involved with the real estate transaction process. There are many times that a realtor comes in to the process of home buying after buyers have looked on the internet to find their dream home.

With the process already being part way completed, realtors need to stay ahead of the game by providing services that will make it worth the commission they are paid. Therefore, the N.A.R or National Association of Realtors maintains the growing forms of services and training for the realtors and agents.

N.A.R creates a broader variety of services that meet the technological and policy advances. This is great for the consumer because N.A.R. directly affects the market and the workings within it.

N.A.R is the ally the property owners can rely on to make sure the fair deal, and ethics are in progress in the real estate transaction world.

There is also a great service that N.A.R does for the realtors and agents. What they do is inform the public of the rights and responsibilities for each and ever realtor and agent.

As with any other profession, the importance of privacy, data security, and the safe guarding of overall confidentiality is very important and in some cases a requirement with legal standings. The N.A.R will help to maintain the highest level of standards for these safeties.

The main reason that makes the involvement of N.A.R so significant is because if there were any forms of issues with corruption, theft, misuse of realtor trust or other areas that would break the trust with the consumer, and therefore causing a direct impact on the real estate industry as a whole.

There is a specific set of rights, goals and values that are set up to ensure the highest quality of service is delivered to the buyers and sellers in their real estate transaction.

Here is a list that you can keep in mind when you are working with your realtor who is fully licensed and represented with N.A.R.

o Maximizing housing opportunities to the fullest

o To be an advocate in the process of real estate transactions for the realtor and client alike

o Increasing the benefits of private enterprise, free market, and collective action

o They work to improve and maintain the highest level of professional ethics, conduct and practice.

o The right to own, use, and transfer real property

o The importance of growth and success of their members

o Their over all goals are to be the voice of real estate, increasing the productivity, professionalism and satisfaction of the real estate world.

The way that all of these ideas affect the home seller, or home purchaser, is that there is someone who maintains the best interest of both parties in mind. Making the best working environment that will increase the positive experience and ethical practice for all.

Immobilienmakler Heidelberg

Makler Heidelberg

With the COVID-19 pandemic slowing down the real estate market, selling a house has become a herculean task for many homeowners. Not to mention, in today’s economy, some homes are remaining on the market for months. However, even though selling your home during COVID-19 can be tricky, it isn’t impossible. With a little know-how, you will be able to sell your home quickly.

Furthermore, selling a house during COVID-19 may sound tough initially, but it is not that difficult to do. Listed below are four tips to sell your home during COVID-19.

1. Advertise properly- While technology and the Internet have made it easy to list real estate for sale online, you need to pack a greater punch to get buyers to take notice of your property if you want to sell your home during COVID-19. From putting up a for sale sign and advertising your home on as many of the major property websites as possible to advertising your home for sale on social media, make sure you leave no stones unturned in terms of advertising your home for sale. Furthermore, you should also distribute flyers and even put an advertisement in the local newspaper. This will allow you to reach out to more people and so, there will be chances of more offers.

2. Virtual tours- Virtual tours are very effective when it comes to marketing and selling your home during COVID-19. Furthermore, a good virtual tour will grab a home buyer by hand and lead them from room to room, whether it is 360 or a video.

3. Be an aggressive home seller- Let’s face it, waiting for the home buyer to come by will not get you anywhere. You need to go all out to spread the word. From putting up a for sale sign to repainting and remodeling your home, do everything within your power to sell your home fast during COVID-19.

4. Declutter and keep your home clean- Nothing can turn off home buyers faster than a home in disarray. Furthermore, whether or not you are currently living there, make sure you take the time to declutter, deep-clean and spruce up. In addition, when cleaning your home, make sure you also remove photographs and other personal information that may be visible, as you want to make buyers feel comfortable when viewing your home.

While selling a home during COVID-19 can be tricky, if you spend some time and effort in creating that perfect atmosphere for your house and keep in mind the above-mentioned tips and tricks, you will be able to sell your home in no time.

Immobilienmakler Heidelberg

Makler Heidelberg

Once again as we approach that time of the year, at what seems to be a million miles an hour we are putting ourselves under pressure to complete the infamous „to do list“ before Christmas is upon us.

If one of those items on your list is „placing your house for sale“ the time constraints can push you into making a quick decision on which agent you choose to handle what most probably is your biggest cash asset.

Over the last month we have had many requests through our website http://www.independentrealestateconsulting.com.au for tips on interviewing agents.

An article just appeared in the Canberra City Times in which we had a little helping hand and it covers this topic perfectly.

„The art of finding a great agent…

Regardless of how much your house is worth or its location, you still have to get it right at sale time. Given the size of the dollars involved you, this means you have to put more work into understanding the process than you put into your footie tips.

The first thing to realize is that the whole point of selling is maximizing the price. And this is where a great real estate agent can make all the difference. I said great, not just any.

Have you ever gone to a few house exhibitions and noticed the difference in how the agents operate? Ignore the agents who just sit back and wait for someone to hand them a cheque because the one you want working for you at sale time is the one who really works for the best sale, who is actively assessing prospective buyers, following them up after the exhibition, engaging them and teasing out the top deal.

Yes, getting someone like this working for you will cost money. But you don’t work for free so don’t expect the best agents to work for free either.

Which brings us to DIY sellers. Sell it yourself by all means, if you’re good enough. But don’t do it yourself if your objective is just to save $1000 in commissions. I’d rather my agent worked up the price by an extra $5000 or $10,000 and we’d split the upside. My house is not a discount piece of cheese and any agent who thinks it is can go sell hamburgers. And this brings us to the art of the deal.

Real estate selling consultancy, Independent Real Estate Consulting (IREC). Has just released a quick guide to using and choosing a real estate agent. Their biggest lament is that too many inexperienced sellers assume they will get a good deal from their agent automatically, as if somehow all agents are as good as each other.

They believe the big differentiator is in negotiating and that’s why they say that before signing up a smooth-talking agent you should always take a closer look and test them out.

Start by asking what is their negotiation range. IREC says a big red flag is when a prospective agent says they allow for example a 10 per cent range because that means the best deal you will get will probably only be 90 per cent of your asking price.

Agents speaking like this are already in excuse mode. You want them to beat the asking price, not use it as the upper limit. Any clown can sell a house for its market value, but the power hitters are the ones who can sell it for more than the market price.

IREC also say you should ask them how they would respond to classic giveaway questions such as „How long has this property been on the market?“, „Why is the vendor selling?“, or „how much will the vendor accept?“. If their answers don’t convince you then why would they convince a prospective buyer?

Finally, IREC say you should try to negotiate with your agent regarding their fees, not to push them down, but to see how they respond. If the agent is easy to squeeze, then its another red flag because it probably means they’ll easily drop the price for a pushy purchaser.

Remember that your real estate agents job is not selling your house, but it’s making you money. Finding them will require you to shop around, but it will be worth it.“

Alex Dunnin managing editor of the Rainmaker Group.

If there is any specific topic you would like the inside info on, let us know.

Immobilienmakler Heidelberg

Makler Heidelberg

Are you struggling to sell your home? I guess it must be said it is very much a buyer’s market at the moment. With the sharp economic decline of the past few years, house prices steadily falling and no such thing as a stable job, things have swung in favour of the buyer considerably! There are so many undervalued homes on the market, it’s no wonder there are millions of people out there looking to get on the property ladder with the best deal possible. Within the article I would like to provide some helpful tips to sell your house:-

1) If money is a problem and you don’t want to pay out for a real estate agent, you have plenty of help online. Did you know that there are numerous companies that can supply you with a „For Sale“ board and an extensive sellers pack to guide you through the process?

Also check out other property listings online and in the newspapers. Make a note of any listings that stand out or really catch your eye. What attracted you to them? What was good or even bad about them? One of the best tips to sell your house I can offer is to learn from what others do well and also from the mistakes they make!

2) If you are using an agent, they will always tell you that they will deal with any potential buyers as buyers don’t want the „home owner“ there when they are viewing your home. This is true to an extent, no-one wants someone else breathing down their neck when they have such an important decision to make. However, the buyers will want to eventually meet you. A great tip on selling your house is to make your buyers more inquisitive about you.

A great way to do this is to make up a useful information pack for prospective buyers. You should include things such as local schools, restaurants, gyms and stores. Perhaps add some additional information about local travel routes and even places of interest or relaxation. Also include your contact details with your information pack. Believe me, buyers will greatly appreciate the effort you have gone to and will want to meet you. This is then your opportunity to gauge how serious any offers actually are!

3) Probably the best tip on selling your house is to get the price right! If your valuation is too high, your property could sit unsold for a very, very long time. If you value your home far too low, then you will always be wondering what you lost out on! You can get a professional valuation done. There are even tools online that will ask you to provide certain information about your property and then give you a standard valuation.

You may choose to visit websites or newspaper listing to get an idea of what comparative properties are selling for.

Immobilienmakler Heidelberg

Makler Heidelberg

The maximum period for which the lease agreements can be made in real estate is 60 year term period. Shorter leases for the real estate for sale are also available. Cook Islands are part of the pacific rim of islands and the major industry is tourism. The only people that are allowed to purchase real estate for sale are available to:

* Natives of

* Those that have a permanent residency immigration status

* Those that are buying an existing business in or those that are planning to set up a business in Cook Islands.

Rarotonga is the biggest island and also the most developed of the real estate. Many investors are interested in buying properties here and the asking price for the villas can range from NZ$ 450,000. for sale properties is available at the beachfront and near the beaches. It also has an international airport which makes the access very simple. There are daily flights from Australia and New Zealand and from other parts of the world as well.

Holiday apartments for foreigners are also currently available for foreign ownership and can range from NZ$200,000 to NZ$400,000 depending on the locations in Rarotonga. Many of these properties also allow the owner 20-40 days free usage of the property. Rental yields can be extremely high and can start around 20-30% per year. If the owner wants more free stay, then the rental yields will come down. These holiday apartments are maintained by a third company and the owner can receive up to 50% of the gross rental incomes.

Along with holiday homes and villas, restaurants and shops are also desired and these can be obtained for a 60 year lease period also. Sometimes the existing leaseholder on the land can also sell their existing business to another company or person.

The average land values are in the range of NZ$150,000 for a 50 year lease term period for an about 0.25 acres. The land leases need to be paid upfront for the entire lease term period. Since tourism, copra and citrus fruit exports are the major earners, the Cook’s island economy is not vastly affected. It also has limited infrastructure and is periodically hit by natural disasters as well.

Immobilienmakler Heidelberg

Makler Heidelberg

Many timeshare owners are trying to shed their shared property, which is reflected on the resales market, especially on online auction sites like eBay.

It is not a secret that economy is getting tough, and everybody is more conscious about the value of money. Prices increase very constantly, and the importance of economize is now huge. The tough economy affects everyone, and timeshare owners are not the exception. As a result of this, a big number of timeshare owners would like to get rid of their vacation properties because of the annual fees they have to pay, thereby, many of them decide to put their timeshares up for sale. Being desperate to dump their ownerships, at the present time is possible to buy a little „piece of heaven“ in a paradisiacal destination just for a few bucks; it would only take to look for an eBay timeshare for sale for you to see what we mean.

eBay Timeshare for Sale

eBay is an American multinational auction website, the world greatest and a market leader. eBay makes possible for people and businesses to buy and sell all kind of goods and services around the world, including timeshares. With over 70 million users, eBay seems to be the perfect place to sell or buy a timeshare.

eBay has a special section for timeshare resale, as of this writing there are at least 1200 timeshare units listed for sale, but this number changes every day. Lots of these units are available for extraordinary prices, being the cheapest ones for one penny, namely, not even a dollar. Needless to say, there is a large list of timeshare for sale on eBay.

Selling on eBay

Listing your timeshare on eBay will cost $35 (Insertion fee), but if you want your vacation property to stand out from the others, you can list it with eBay’s Superlister Tool, which will cost an extra $15. Many timeshare owners decide to list their ownerships on eBay due to the big number of resale companies that take advantage of them by asking them for ridiculously large upfront fees.

eBay has trading assistants that can give you an advice on how to sell your timeshare on eBay properly. It is highly recommended that you take several pictures of your timeshare and that you have all your timeshare documents in order, which will make easier for you to list your timeshare for sale on eBay. If the timeshare is sold, you will have to pay another $35 as a final value fee.

Buying on eBay

By acquiring an eBay timeshare for sale, you are also assuming the responsibility to pay the ever increasing maintenance fees and special assessments that are charged every year.

When you buy a timeshare on eBay, you have to keep in mind that you don’t only have to pay the price you see on the ad, since there are more costs involved. You will also have to pay the maintenance fees, the closing fee and the resort transfer fee. All these fees together can add up more than $1000.

One thing to take into consideration is that the value of a timeshare is not an investment, bust just a vacation option. That’s because the real owner of the timeshare is the resort, you only purchase the right to use the property for a specific number of weeks each year.

Timeshare resale market

What we have to understand first about the timeshare resale market, is that the supply is much greater than the demand, which means it will not be easy for you to sell your timeshare fast, being that said; listing your vacation property as an eBay timeshare for sale is not the best solution to get rid of it, in fact, it will be almost impossible for you to find a buyer for your timeshare.

If you have a timeshare you want to get rid of, do not wait any longer. Mexican Timeshare Solutions is a legitimate company that assists timeshare purchasers who want to shed their vacation properties. MTS works under a contingency basis and only collects fees if your issue is successfully solved, otherwise, no fees are charged. Contact MTS for a free consultation on your matter and get a final relief of your timeshare.

Immobilienmakler Heidelberg

Makler Heidelberg

Depending on where you live, your local real estate market may be experiencing a downturn. Historically, these market adjustments have served as a natural protection against runaway price inflation, and in the long-run can be very positive, but as a buyer in one of these markets you must buy smart to protect your financial future.

Here are 5 ways in which you can take advantage of a down market and protect your interests for the future at the same time…

1. Look at the local job market. Know who the major employers are in town and where their employees typically live. Read the papers and pay attention to the stability of these employers. If the company is in financial trouble, or is going to lay off employees, be careful about buying in areas heavily populated by their employees. Yes, you may get a great deal, but home prices may drop dramatically around you and cause you to lose money. Plan for that in your negotiations.

2. Research new commercial developments in your area. If you discover that a new retail / commercial center is going in near an area you desire to live in, take the time to find out what stores are planned for the development, and look at how things like traffic flow and access are going to be addressed. A bad plan can negatively affect area property values, but conversely a well-planned development can draw buyers like a magnet raising property values.

3. Learn about zoning. If you buy a home right next to land zoned for commercial development and you do not realize it, your property value could be negatively affected by the increase in traffic and the type of development. If you are looking in a fully-developed residential area this may not prove to be much of a factor, but be aware of any nearby open spaces and their zoning that could make access to your residential area more challenging. Again, good developments can be to your benefit, but consider how the changes could affect value in your negotiations.

4. Drive the area you desire to live in. Take a camera and a note pad to record what you find. Look for things like for-sale signs, blighted properties, new construction or residential developments, open lots and land, road construction and access, and the availability of retail services. Lots of ‚for sale by owner‘ or real estate signs could spell trouble as numerous homes for sale could cause a price reduction war to sell. Again, it may be to your benefit, but you must consider this in your negotiations.

Blighted properties will reduce the value of homes in the immediate area, and new construction, or anything that increases housing density can ultimately reduce value in a slow market as inventory increases and the number of buyers decreases. Be wary of new developments without any noticeable construction activity as there may be financial issues that could affect the value of all of the homes in the area. Don’t be the sucker that pays top price for a home nobody wants.

Open lots and the availability of land can be a positive depending on the area you are looking in, but keep in mind that zoning can change and there are lots of commercial developers out there looking for any sliver of land possible to develop in many markets.

5. Negotiate strongly with the seller. I am a firm believer in homes being exchanged for fair market values, meaning the transaction should be a win-win, but that doesn’t mean you cannot, or should not attempt to negotiate your best terms. Do your research and come to the table armed with extensive, current market knowledge, and a willingness to set your final terms and stick with them. Be reasonable, but firm. Be aware of the long-term implications of your purchase and ensure you have an exit strategy in place. Most importantly, do not be afraid to stand your ground. If you have done your research, the numbers will speak for themselves.

I hope these ideas will help you make a smart purchase in a down market. You must keep in mind that even if you get a great deal on a home, the market can continue to slow down and negate your gains. Know your market well enough to withstand the fluctuations. Above all, secure competent, knowledgeable assistance from professionals in the real estate industry to answer your questions and educate you so you can buy smart in our current market.

Immobilienmakler Heidelberg

Makler Heidelberg

Not so long ago, it is usual for investors to make fortunes in real estate. It was nothing to buy a home, wait a short while, and then sell it at a tidy profit, and then do it over and over again.

As you are no doubt aware, times have changed. As good as the market may be at any given moment, home prices remain below what they were at their peak.

And buyers are far more discriminating: a large percentage of the homes listed for sale never sell. So it’s more important than ever to learn what you need to do to avoid costly seller mistakes and sell your home quickly and for the best possible price.

The 9 Step System to Get Your Home Sold Fast and For Top Dollar

Selling your home is one of the most important undertakings in your life. This nine-step system gives you the tools you need to maximize your profits, maintain control of the process, and reduce the stress that is always part of the home selling process.

1. Know why you’re selling, and keep it to yourself.

   The reasons behind your decision to sell can affect everything from setting the price to how much time and money to invest in preparing your home for sale. Which is more important to you: the amount of money you walk away with, or how long your property is on the market before it sells? These different goals require different strategies.

   However, once you’ve determined your motivation, don’t reveal it to anyone except your realtor because they may use it against you at the negotiating table. When asked, simply respond that your housing needs have changed.

2. Do your homework before you set a price.

   Do not take the job of setting the listing price lightly. Once you set a price, you’re telling buyers the absolute maximum they’ll have to pay for your home, but pricing too high is as dangerous as pricing too low. Remember that the average buyer is looking at 15-20 homes at the same time they are considering yours.

   This means that they have a basis for comparison, and if your home doesn’t compare favourably with others in the price range you set, you won’t be taken seriously by prospects or agents. As a result, your home could sit on the market for a long time and, new buyers in the market may think there is something wrong with your home that has kept it from selling.

3. Do your homework.

   In fact, your agent should do this for you. Find out what homes in your own and similar neighbourhoods have sold for in the past 6-12 months, and research what currently listed homes are listed for. That’s exactly how prospective buyers will assess the value of your home.

4. Find a good real estate agent to represent your needs.

   Almost three-quarters of homeowners say they wouldn’t use the same realtor who sold their last home. Dissatisfaction is frequently due to poor communication, which results in not enough feedback, lower pricing and strained relations. Request your free copy of our report, „10 Questions to Ask Before You Hire an Agent“ to learn about the questions you should always ask when you interview agents who want to list your home.

5. Maximize your home’s sales potential.

   Corporate North America spends billions on product and packaging design every year. Appearance is critical, and it is foolish to ignore it when you sell your home.

   While you cannot change your home’s location or floor plan, you can do a lot to improve its appearance. The look and feel of your home triggers an automatic emotional response in potential buyers.

   Clean like you’ve never cleaned before. Pick up, straighten up, remove clutter, scrub, scour, and dust. Fix everything, no matter how insignificant it seems. Present your home to get a „Wow!“ response from prospective buyers.

   Create an atmosphere that will encourage buyers to imagine them living in your home. The decision to buy a home is based on emotion, not logic. Prospective buyers want to „try your home on“ just like they would a new garment. If you follow them and point out every improvement, or if your decor is so unusual that buyers can’t push it out of their minds, you’re making it difficult for them to feel comfortable enough to imagine the home.

6. Make it easy for prospects to get information on your home.

   It may surprise you to know that some of the most frequently used home marketing strategies (traditional open houses, for example) really are not very effective. In fact, only 1% of homes are sold at an open house.

   And prospective buyers calling for information about your home value their time as much as you value yours. They do not want to be subjected to a game of telephone tag with an agent, or an unwanted sales pitch. Make sure the ads your agent places refer inquiries to a 24 hour, pre-recorded hotline with a specific ID number for your home. It should provide detailed information about your property day or night, seven days a week, without having to talk to anyone. Three times as many buyers call for information about homes under this system. And the more buyers that are competing for your home, the better, because it can create up auction-like atmosphere that puts you in the driver’s seat.

7. Know your buyer.

   During negotiations, your objective is to control the pace and set the duration. Determine your buyer’s motivation. Find out if the buyers need to move quickly. Will they be able to pay your asking price? Having this information gives you the upper hand in negotiations, because you know how far you can push to get what you want.

8. Make sure the contract is complete.

   As a seller, be certain to disclose everything. Smart sellers proactively go above and beyond the legal requirement to disclose all known defects, in writing, to buyers. If you tell buyers in advance about known problems, they can’t come back with a lawsuit later on.

   Make sure all terms, costs, and responsibilities are spelled out in the sales contract, and resist the temptation to override the contract. For example, if the buyer asks to move in prior to closing, just say no. Now is not the time to take a chance on the sale falling through!

9. Don’t move out of your home until it’s sold.

   Studies show that it is more difficult to sell a vacant home because it looks forlorn, forgotten, and simply not appealing. It could even cost you thousands. And if you move, you’re telling buyers that you have a new home and are probably motivated to sell fast. This gives the buyer the advantage at the negotiating table.

If you follow the nine suggestions in this article, you’re much more likely to be able to sell your home quickly and for top dollar.

Immobilienmakler Heidelberg

Makler Heidelberg

You are in business with one or more business ‚partners‘. Most likely all of the business owners

are involved in the day to day running of the business. But what happens if you or they die or

retire from the running of the business? Here we set out some of the problems you may encounter unless you have a proper business succession document (often called a Buy/Sell Agreement). We also set out some of the options and issues in putting in place a proper Buy/Sell Agreement. These issues are the same regardless of whether your business is run via a company, unit trust or partnership.

Common Problems

These are some of the common problems business owners can encounter when one of the above events occurs: disputes between the continuing owners and the incoming owner of the business (the incoming owner may acquire his or her interest under the will of the deceased former owner). This often occurs as the new owner does not understand the business or does not have the respect of the other business owners; in a private business the sale of a portion of the business to an outside party is often not possible (i.e. there is limited external liquidity). So really there can only be sales between business owners. However, without an agreement:the incoming owner (under a will) cannot force the other business owners to buy his or her portion of the business; and the remaining business owners cannot force the sale of the deceased business owner’s portion of the business; even if all of the owners want a sale to occur there is not sufficient funding to allow this; the owners who still work in the business become disgruntled with having to pay ongoing returns to the new passive owner (i.e. the estate of the deceased owner); and concerns about the continuity and viability of the business, including from employees, customers, bankers, suppliers and creditors who may leave or discontinue support (particularly where the owners are in dispute).

Buy/Sell Agreements

Putting in place a Buy/Sell Agreement can avoid some of the above and provide certainty for

business owners. In simple terms a Buy/Sell Agreement provides a framework under which business owners can sell their interest in the business or buy the interest of a co-owner. For tax purposes (see below) Buy/Sell Agreements usually use options to buy or sell on a defined trigger event (e.g. death of an owner). Usually: the owners not subject to the trigger event have a right but not an obligation to buy the exiting owner’s interest in the business (Call Option); the owner subject to the trigger event has a right but not an obligation to make the remaining owners buy his or her interest in the business (Put Option).

As an alternative, a buy back/redemption agreement could be considered. Under such arrangements the trading entity (e.g. company) rather than the other owners buys back the exiting

owner’s shares (note there are Corporations Act requirements which apply to share buy-backs).

Another alternative is to have a sale of the whole business on a trigger event occurring. We don’t

look at these two options in this paper. We now look at some of the issues you need to

consider and resolve to ensure you meet your needs.

Events

You need to work out the trigger events or conditions which lead to a sale of a business interest. These are often tailored to and limited by funding available for any purchase (see below). There are two broad trigger event categories being: involuntary or insurable trigger events (death, critical illness, and total permanent disability); and voluntary or uninsurable trigger events (retirement, resignation or lawful termination of employment).

Call Options are generally granted on the happening of both involuntary and voluntary trigger events. Put Options are generally granted on the happening of involuntary trigger events. As insurance is not available for involuntary trigger events you may need to consider price reductions or payment over time (vendor finance provisions).

Price

The price at which an exiting owner’s interest in the business is to be sold should be fixed under

the Buy/Sell Agreement and reviewed at agreed intervals. Alternatively the parties should agree to an appropriate valuation methodology and/or an expert valuation process. Careful thought should be given to any scenarios that might justify a reduction of the price payable. For example, a reduction might be appropriate in the case of Put Options for voluntary trigger events as mentioned above (say if an owner is forced out for breaching a Shareholders‘ Agreement or their employment is terminated for fraud). A reduction might also be appropriate in circumstances where an exiting owner fails to maintain an insurance policy as required under the Buy/Sell Agreement or otherwise invalidates an insurance policy.

Funding

A Buy/Sell Agreement is often fully or partly funded by insurance policies. For tax purposes generally ‚principal ownership‘ is used (meaning each owner of the business owns their own

insurance policy). There are other options for insurance policy ownership but these can have

adverse tax consequences (including Capital Gains Tax outcomes on the payment of the

insurance policy proceeds). There may also be tax differences in the treatment of insurance

premiums. So tax advice is critical on these issues.

As an alternative, the owners may decide to use their own capital, borrow money to finance the

sale, and/or enter into a vendor finance arrangement. However, it is difficult to predict if at the time a sale is required the owners will have the funds available to make the purchase. Parties should consider the timing of the payment (up front lump sum or paid over time by way of installments). If payment is to be made over time by way of installments (vendor finance), security (e.g. a mortgage) and interest should also be considered.

Capital Gains Tax

Care must be taken when drafting Buy/Sell Agreements. Options should be used to avoid unintended Capital Gains Tax (CGT) consequences. The entry into of virtually any agreement can be a CGT event. However, a Buy/Sell Agreement using options without consideration will not trigger any CGT liability at the time of signing. Rather, the CGT event and resulting CGT liability will occur on the exercise of the options (i.e. when an unconditional agreement to buy and sell an interest in the business comes into force).

Likewise, where a business succession agreement (including a Buy/Sell Agreement) does not use options but makes the sale of a business interest conditional on an event occurring, the CGT event will not occur on signing but on that condition being satisfied. If the Buy/Sell Agreement includes vendor finance CGT must be carefully considered. Otherwise, a seller will incur the CGT and liability in one year but may only receive the sale price over a number of years.

Immobilienmakler Heidelberg

Makler Heidelberg