What It Costs to Sell a New Development, Line by Line

The cost of turning a finished Saudi building into cash: agency, marketing, show unit, legal and registration work, holding costs and the items first appraisals miss.

Selling is a cost centre, and it is routinely underestimated in appraisals that treat revenue as the finished product. Agency fees, material, a show unit, campaigns, legal and registration work, and the cost of holding unsold units all sit between completion and your money. This breakdown sets out the items, what moves them and how to keep them under control.

What this number does and does not include

This covers selling a completed or nearly completed development to end buyers, from the decision to launch through to registration of transfers. It excludes construction, design, land, finance costs during the build, and the cost of running the building once it is occupied. It also excludes tax advice on the transaction, which belongs with a licensed adviser, and any transaction tax, which is noted separately below.

Sales agency commission

The largest selling cost on most schemes, paid as a percentage of the sale value, on an exclusive or a panel basis. It buys access to buyers, a sales process and someone to answer enquiries. What you pay for depends heavily on the mandate: a fee with no activity obligations buys introductions only, while a fee with a campaign plan and targets buys a managed sales effort.

• Pushes it up: Slow markets, large unit counts, panels where more than one firm claims an introduction, and mandates with retainers as well as commission.
• Brings it down: A single well-drafted exclusive mandate with clear buyer registration rules and defined targets.
• How to control it: Fix registration rules to prevent double claims, and tie any retainer to delivered activity.

Marketing material and imagery

Photography, renderings, floor plans, brochures, signage, a website or landing page and portal listings. This is the material every buyer sees, and weak imagery reduces enquiry volume across the whole campaign, which makes it one of the few selling costs where spending less reliably costs more.

• Pushes it up: Multiple unit types, several languages, reshoots after late design changes.
• Brings it down: One well-planned production once the building is complete enough to photograph honestly.
• How to control it: Produce material after finishes are installed, so images match what buyers will receive.

Show unit and site presentation

A furnished unit, tidy common areas, working lifts, clean parking and signage. Buyers price what they see, and a completed building shown badly transacts at a discount. The show unit is also the fastest way to answer questions about specification without a conversation.

• Pushes it up: Full furnishing packages, styling, several show units and a long sales period.
• Brings it down: One show unit in a representative position, furnished simply, later sold with the furniture.
• How to control it: Budget the show unit as a recoverable cost by selling it furnished at a premium.

Campaign and digital spend

Paid advertising, portal placements and any events. This is the item most often spent without measurement. Tracked properly, with enquiry source recorded, it becomes the cheapest thing in the budget to optimise, because you can move money from a channel producing traffic to one producing buyers.

• Pushes it up: Competitive launches nearby, weak organic enquiry, unmeasured spending across many channels.
• Brings it down: Source tracking on every enquiry and monthly reallocation to what converts.
• How to control it: Require enquiry source reporting, and review spend against reservations every month.

Legal, documentation and registration work

Preparing the sale contract and disclosure pack, handling amendments, dealing with buyer lawyers and mortgage lenders, and completing the registration steps for each transfer. It is largely per unit work, so it scales with the number of sales rather than with the value.

• Pushes it up: Bespoke negotiation on individual contracts, many financed buyers, incomplete documentation at launch.
• Brings it down: One approved template with a short list of permitted variations, prepared before launch.
• How to control it: Approve one template and require written approval for any deviation.

Holding costs on unsold stock

Finance, service charges, utilities, insurance, security and management on units that remain unsold, plus the opportunity cost of capital tied up. This is the cost that turns a pricing mistake into a financial one, because it accrues monthly whether or not anything sells.

• Pushes it up: Slow sales, over-ambitious pricing, releasing all units at once, and high finance costs.
• Brings it down: Realistic pricing, phased release, and a decision point at which remaining stock is let rather than held empty.
• How to control it: Set a date at which unsold units move to a letting strategy, and calculate the monthly holding cost so the trade-off is visible.

Handover and buyer care

Running handovers, closing snag lists, preparing handover packs, and answering buyer questions in the first months. It is part of selling because it determines referrals and resale evidence, and because an unmanaged handover generates costs that dwarf the effort of doing it properly.

• Pushes it up: Handing over before the building is genuinely finished, and having no property manager in place.
• Brings it down: Completed common areas, internal inspections before buyer visits, and a manager appointed from the first handover.
• How to control it: Budget handover as a project with a named owner, not as an afterthought of construction.

Costs that never appear on the first page

• Double commission claims where two brokers registered the same buyer without clear rules.
• Reshoots and reprints because material was produced before finishes were finally chosen.
• Incentives given as furniture, parking or service charge periods, which rarely appear in the marketing budget.
• Cancellations that return a unit to the market after the campaign has moved on, with the deposit disputed.
• The Real Estate Transaction Tax, a published headline rate of 5 per cent to confirm with ZATCA, and who bears it under your contract.
• Extended agency retainers running on after the units that needed selling were already sold.

Keeping the budget honest

Carry selling costs as a single percentage of gross sales revenue in your appraisal, set from your own quotes rather than from a rule of thumb, and test the project at a slower sales rate with the resulting holding costs added. If the return only works when every unit sells at list price in the first six months, the appraisal has priced a hope rather than a plan.

• Before launch: are agency, material, show unit and legal costs all quoted and inside the appraisal allowance.
• Monthly: what did campaign spend produce in enquiries, viewings and reservations by source.
• At each release: is achieved price against list holding, and what are the concessions costing in total.
• At the point where stock remains unsold: what is the monthly holding cost, and does letting beat discounting.
• At completion of sales: what did selling actually cost as a percentage of revenue, and what would you change.

Domira designs, builds and manages projects across Saudi Arabia for owners who are based abroad: land appraisal, feasibility, design, construction, handover and asset management under one accountable contract. Send us the plot or the brief and Domira will put the numbers in front of you before you commit.