It Sold For HOW Much? WTF!

I’ve been a realtor for over 10 years now, and I can honestly say that I’ve never seen as many WTF sale prices as I saw last week.

It’s not unusual for a house to sell for stupid money in this city (it is Toronto after all), but last week was notable because it happened so many times!

All over the city, almost every day, houses and condos were selling for unprecedented figures.

“Unprecedented” is the key word here, but I’m not sure it really does justice to what we saw last week.

A few examples…

Sale #1: A condo townhouse in the east-end

  • 1,100 sq ft
  • 2-bed / 2-bath
  • Parking

The last few comparable sales happened back in the summer, and sold for around $580,000. This new listing was priced at $589,000 and sold on offer-night… for $840,000!

Sale #2: A freehold home in the Don Mills area

  • 1,500 sq ft
  • 3-bed / 3-bath
  • Detached 2-storey

The listing agent and seller priced it low ($1,188,000), thinking that it might sell for somewhere in the $1,500,000 - $1,600,000 range. It sold on offer-night (with 31 offers) for… $2,303,000! Read more about this sale in the Toronto Star here.

Sale #3: A one-bedroom condo in the downtown core

  • 600 sq ft
  • 1-bed / 1-bath
  • No parking

A nearly identical unit sold in this building in the spring, for around $390,000. This new listing was priced at $435,000 and sold on offer-night… for $505,000!

It’s Sunday night as I write this, and I’m wondering what tomorrow and the rest of the week will bring. It can’t be as crazy as last week, can it? We’ll see…

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

Four Major Changes To Canada's Housing Rules

Four Major Changes To Canada's Housing Rules - Photo If you haven't already heard, the Canadian Department of Finance made an announcement earlier this month outlining a handful of changes that will have an impact on the mortgage/housing market.

The Globe & Mail followed the announcement pretty quickly with a detailed breakdown of all the changes, and how the affects might be felt.

Below is a reposting of that article in full. Enjoy!


From the Globe & Mail, on October 3rd, 2016:

Four Major Changes To Canada's Housing Rules

The Liberal government has announced sweeping changes aimed at ensuring Canadians aren’t taking on bigger mortgages than they can afford in an era of historically low interest rates.

The changes are also meant to address concerns related to foreign buyers who buy and flip Canadian homes.

Below is a breakdown of the four major changes Finance Minister Bill Morneau announced Monday.

The current rules

Buyers with a down payment of at least 5 per cent of the purchase price but less than 20 per cent must be backed by mortgage insurance. This protects the lender in the event that the home buyer defaults. These loans are known as “high loan-to-value” or “high ratio” mortgages.

In situations in which the buyer has 20 per cent or more for a down payment, the lender or borrower could obtain “low-ratio” insurance that covers 100 per cent of the loan in the event of a default.

Mortgage insurance in Canada is backed by the federal government through the Canada Mortgage and Housing Corp. Insurance is sold by the CMHC and two private insurers, Genworth Financial Mortgage Insurance Company Canada and Canada Guaranty Mortgage Insurance Company. The federal government backs the insurance offered by the two private-sector firms, subject to a 10-per-cent deductible.

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The change

Expanding a mortgage rate stress test to all insured mortgages.

What it is

As of Oct. 17, a stress test used for approving high-ratio mortgages will be applied to all new insured mortgages – including those where the buyer has more than 20 per cent for a down payment. The stress test is aimed at assuring the lender that the home buyer could still afford the mortgage if interest rates were to rise. The home buyer would need to qualify for a loan at the negotiated rate in the mortgage contract, but also at the Bank of Canada’s five-year fixed posted mortgage rate, which is an average of the posted rates of the big six banks in Canada. This rate is usually higher than what buyers can negotiate. As of Sept. 28, the posted rate was 4.64 per cent.

Other aspects of the stress test require that the home buyer will be spending no more than 39 per cent of income on home-carrying costs like mortgage payments, heat and taxes. Another measure called total debt service includes all other debt payments and the TDS ratio must not exceed 44 per cent.

Who it affects

This measure affects home buyers who have at least 20 per cent for a down payment but are seeking a mortgage that may stretch them too thin if interest rates were to rise. It also affects lenders seeking to buy government-backed insurance for low-ratio mortgages.

Why

The government is responding to concerns that sharp rises in house prices in cities like Toronto and Vancouver could increase the risk of defaults in the future should mortgage rates rise.

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The change

As of Nov. 30, the government will impose new restrictions on when it will provide insurance for low-ratio mortgages.

What it is

The new rules restrict insurance for these types of mortgages based on new criteria, including that the amortization period must be 25 years or less, the purchase price is less than $1-million, the buyer has a credit score of 600 and the property will be owner-occupied.

Who it affects

This measure appears to be aimed at lowering the government’s exposure to residential mortgages for properties worth $1-million or more, a category of the market that has increased sharply in recent years in Vancouver and Toronto.

Why

Vancouver and Toronto are the two real estate markets that are of most concern for policy makers at all levels of government. These measures appear to be targeted at those markets.

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The change

New reporting rules for the primary residence capital gains exemption.

What it is

Currently, any financial gain from selling your primary residence is tax-free and does not have to be reported as income. As of this tax year, the capital gains tax is still waived, but the sale of the primary residence must be reported at tax time to the Canada Revenue Agency.

Who it affects

Everyone who sells their primary residence will have a new obligation to report the sale to the CRA, however the change is aimed at preventing foreign buyers who buy and sell homes from claiming a primary residence tax exemption for which they are not entitled.

Why

While officials say more data are needed, Ottawa is responding to extensive anecdotal evidence and media reports showing foreign investors are flipping homes in Canada and falsely claiming the primary residence exemption.

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The change

The government is launching consultations on lender risk sharing.

What it is

Currently, the federal government is on the hook to cover the cost of 100 per cent of an insured mortgage in the event of a default. The federal government says this is “unique” internationally and that it will be releasing a public consultation paper shortly on a proposal to have lenders, such as banks, take on some of that risk. The Department of Finance Canada acknowledges this would be “a significant structural change to Canada’s housing finance system.”

Who it affects

Mortgage lenders, such as banks, would have to take on added risk. This could potentially lead to higher mortgage rates for home buyers.

Why

The federal government wants to limit its financial obligations in the event of widespread mortgage defaults. It also wants to encourage prudent lending practices.

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Five previous federal housing moves since 2008

Monday’s package of announcements is the sixth time since the onset of the 2008 financial crisis that Ottawa has taken policy action in response to concerns about Canada’s housing market. July, 2008: After briefly allowing the CMHC to insure high-ratio mortgages with a 40-year amortization period, then Conservative finance minister Jim Flaherty moved to tighten those rules by reducing the maximum length of an insured high-ratio mortgage to 35 years.

February, 2010: Responding to concern that some Canadians were borrowing too much against the rising value of their homes, the government lowered the maximum amount Canadians could borrow in refinancing their mortgages to 90 per cent of a home’s value, down from 95 per cent. The move also set a new 20-per-cent down payment requirement for government-backed mortgage insurance on properties purchased for speculation by an owner who does not live in the property.

January, 2011: The Conservative government under Stephen Harper tightened the rules further, dropping the maximum amortization period for a high-ratio insured mortgage to 30 years. The maximum amount Canadians could borrow via refinancing was further lowered to 85 per cent.

June, 2012: A third round of tightening brought the maximum amortization period down to 25 years for high-ratio insured mortgages. A new stress test was also introduced to ensure that debt costs are no more than 44 per cent of income for lenders seeking a high-ratio mortgage. Refinancing rules were also tightened for a third time, setting a new maximum loan of 80 per cent of a property’s value. Another new measure limited the availability of government-backed insured high-ratio mortgages to homes valued at less than $1-million.

December, 2015: The recently elected Liberal government moved to tighten lending rules for homes worth more than $500,000, saying it was focused on “pockets of risk” in the housing sector. The package of measures included doubling the minimum down payment for insured high-ratio mortgages to 10 per cent from 5 per cent for the portion of a home’s value from $500,000 to $1-million.

Is It A Bad Idea To List Immediately After Labour Day?

Is It A Bad Idea To List Immediately After Labour Day? Photo

Is It A Bad Idea To List Immediately After Labour Day? Photo

Summer doesn’t officially end until the Autumnal Equinox in the 3rd week of September, but we all know it really ends the day after Labour Day.

Every year, the Tuesday after Labour Day sees the kids go back to school, the white clothes go back into the closet, and the real estate market come back to life after the August slow-down.

A whole slew of new listings hit the market during that first week after Labour Day, and plenty of eager sellers (and realtors) are excited to get the ball rolling.

In my opinion though, it’s a good idea to consider waiting until the following week to list your home for sale.

The goal is to expose the property to as many buyers as possible, but a good chunk of the buyer pool is distracted at this time of year.

There’s so much happening in people’s lives during that first week after Labour Day, that there’s a good chance many of the new listings are going to slip-by unnoticed.

  • People are busy getting back into the swing of things at work.

  • Anyone working in a seasonal industry is likely focused on transitioning over to their fall market.

  • People are coping with the fact that summer’s over and the cold & rainy weather is just around the corner (ugh).

  • And then of course there are the families that have small children…

I know that my wife & I are going to be preoccupied these next few days with starting our oldest daughter in JK. If we were searching for a home right now we’d almost certainly be taking a week off from our search to concentrate on the start of school.

I myself have a new listing coming out soon, and we’re waiting until that 2nd week after Labour Day to go to market. My clients are fully onboard with the idea that we’ll reach the maximum number of potential buyers if we wait that extra week.

That’s not to say that a seller won’t still do well if they list right after Labour Day. And not every seller is even going to have the option of waiting until mid-September to list.

If you really want to maximize your odds of success though, you do need to consider all of the angles and strategize accordingly.

So, while it might not necessarily be a bad idea to list immediatley after Labour day, it might be a good idea to hang back and wait a week.

Here’s to a kick-ass fall market!

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

What A Difference A Season Makes

What A Difference A Season Makes Photo More than once over the course of these past few months, I've seen a house come on the market and sell for significantly more than what it was unsuccessfully listed at back in the fall/winter.

You could argue that this makes sense - that in a rising market a house should sell for more now than it would’ve 6 months ago.

Maybe, maybe not. (More on that towards the end of this blog post).

Regardless, it’s interesting to see such a scenario play out in real time with one specific property.

Here’s a breakdown of what happened with one of the houses I’m referring to:

House is listed in June 2015

Located in a very hot area in the west-end of the city.

Priced at $679,000, with a hold-back on offers.

Offer night comes and goes, and the property doesn’t sell.

They re-list the following day at $719,000, with offers welcome anytime.

After 3 more weeks without selling, they take it off the market.

Same house is re-listed in February 2016

7 months after unsuccessfully trying to sell, they’re back on the market.

Priced again at $719,000, with offers welcome anytime.

In less than 24hrs they receive 3 competing offers and the house sells for $755,000 (105% of list price).

No one wanted the house back in the summer, but by winter’s end there were three buyers tripping over each other to pay well above the asking price.

Wow! What a difference a season (or two) makes.

Does this necessarily mean that the same scenario would play out for every single house listed for sale in the Toronto real estate market right now? Is every single seller out there guaranteed to sell for significantly more if they just wait another 6 months?

Not necessarily. I’m sure there are sellers out there who did better 6 months ago than they would today, for a number of reasons; maybe they were competing with fewer similar listings than they would be today, maybe there were more buyers in the market that week for their particular house than there would be this week, etc.

On the whole though, prices are increasing and you’ll very likely pay more for a house 6 months from now. Just ask the three buyers who bid on the house in my example above.

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

Did There Really Need To Be 15 Offers?

Did There Really Need To Be 15 Offers? Photo

Did There Really Need To Be 15 Offers? Photo

I was involved in a multiple-offer scenario last week, on a condo townhouse in the east end.

The property had a helluva view, and there was no doubt that it was going to attract plenty of interest and receive a bunch of offers.

“A bunch” ended up being an understatement.

There were 15 offers. FIFTEEN!

The property sold for 125% of the list price (it was listed at $409,000 and sold for $510,000).

With so many offers and such a high sale-to-list price ratio, you have to ask yourself, “Did they really need to under-list the property by that much?”

Couldn’t they have listed at, say, $449,000 (which would still be “underpricing” the property, albeit less drastically)?

While there was obviously one very happy “winner” on offer night, there were 14 other buyers that went home empty handed.

No doubt, some of those buyers went in offering less than $449,000. And despite submitting what they (and/or their realtor) thought was a reasonable offer, they never actually had a chance.

Couldn’t the sellers have been a bit less extreme in their pricing, and perhaps spared a handful of those hopeful buyers on offer night? Wouldn’t they still have ended up with a $510,000 sale price?

Truth be told, there’s no way to know for sure if they would’ve ended up at the same sale price (although I think they would have). Sure, it’s possible that the top offer wouldn’t have come in as high had there only been 7 or 8 offers (unlikely I think, but possible).

On a funny side note, the listing agent had made a point of saying that he felt that there was no need to put anyone through the hassle of going to get a certified cheque ahead of offer night, as it would only add undo stress and waste too many people’s time.

Okay…

But he felt it was reasonable to under-list the property by $75,000 - $100,000? He didn’t think that would result in wasting a bunch of people’s time? Ha!

Granted, the listing agent did a great job for his clients. He orchestrated a process that got them a record-high price for their property.

It’s a frustrating process though, when one happy seller and one happy buyer have to leave 14 other disappointed parties in their wake.

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

When Should A Seller Consider Accepting A Bully Offer?

 
TAKE_THE_MONEY_AND_RUN_MONOPOLY.jpg
 

When should a seller consider accepting a bully offer?

I am of the opinion that a seller is almost always going to do better if they avoid looking at bully offers, and wait until their scheduled offer night instead.

Every now and then though, a seller finds themselves in a situation where a bully offer is just too damn good to pass up!

Sometimes the price is so phenomenally above what they were expecting to get, that it's just not worth the risk of waiting and ending up with a lower price on offer night.

Sometimes the sellers are seriously stressed out by the entire process of having their home on the market, and the prospect of having it all over-and-done with is a no brainer.

And then there are times where it's actually looking like the home is not going to get the offers that the sellers want/expect on offer night. Case in point...

Earlier this year I had a listing in the west end of the city.

We spent a couple of weeks prepping the property to go on the market, and we decided that the best strategy would be to review offers on a specific date (the following Tuesday after the property initially hit the market).

I actually felt that we were pricing the home at the very top range of what it might be worth, and that we shouldn't necessarily expect to get multiple offers on offer-night. My clients appreciated where I was coming from, but we still felt that a hold-back on offers was the right strategy since comparable homes rarely come up for sale in the area.

Five days into the listing, I received a call from a buyer's agent, saying that her clients wanted to submit a bully offer. My clients were happy to look at it.

Once the offer was registered with my office, I did my duty and reached out to every single agent who had shown the property. And you know what? None of them had clients who were interested in submitting an offer. Not one.

None of them wanted to compete with a bully offer, and in fact, none of them were planning to submit anything on the scheduled offer night either!

It was quickly becoming apparent that this bully offer was probably the only offer we were going to see.

I told my sellers that they were likely going to do much better if we worked with the bully offer that night, as the buyers would be acting under the perceived threat of having to compete with other buyers on offer-night.

We ended up selling the property that night, with only the one offer, for above the list price.

Needless to say, my clients were very happy. The buyers were happy too, as they the secured the home they wanted (who knows if another buyer might've come out of the woodwork on the scheduled offer night and out-bid them?).

Bully offers are a tricky beast, and it's sometimes a tough call on whether or not to to work with them. Sometimes though, it just makes sense to take the money and run!

If you're thinking of selling your home, and you want an agent who knows when you should or shouldn't consider accepting a bully offer, feel free to contact us for more info.

Your Realtor Is Full Of S**t!

Bullshit.jpg

With Labour Day behind us now, the fall real estate market has officially begun!

Just like last year, and the years before that, we're going to see a ton of new listings hit the market this week. And inevitably, some of those listings are going to be overpriced.

There are a handful of reasons why a seller chooses to overprice their home. In this post I want to focus on just one of those reasons: The listing agent lied to the sellers about the true market value of the property.

The Sunshine Approach

The manager at the brokerage where I started my real estate career referred to this as "The Sunshine Approach"; the idea being that the listing agent is "blowing sunshine" up the seller's arse by deliberately overvaluing the home in order to get the listing.

I see it happen all the time. A seller interviews two or three realtors, and ultimately chooses the one who suggests the highest list price. The seller gets stars in their eyes, and is fooled into thinking that the ridiculous list price is actually achievable.

The listing agent's plan is simple: continually work on the seller for price reductions until the home finally sells (almost always for less than market value).

Isn't The Seller Partially To Blame?

Yes, the seller is often partially to blame here. Especially when the other two realtors they interviewed suggested lower list prices (which were no doubt backed-up by tangible market data and past sale prices in the neighbourhood).

Instead, the seller chose to list with the one who came up with the highest number, in spite of what the market data showed.

The seller in this situation sometimes knows, in their gut, that it's too good to be true.  But flattery and the promise of an unprecedented sale price get the better of them.

Have I ever taken an overpriced listing?

Yes, of course I have taken an overpriced listing.

The difference being, the sellers knew from the beginning where I stood on the value of the home.

I made it clear to them that the list price they were choosing was too high, that there were risks involved with overpricing, and that a price reduction would eventually be needed.

It's certainly not the best way to sell a home, but sometimes a seller is determined to "try their price first", even if doing so is going to potentially have a negative impact on the final outcome.

In the end, a seller needs to be realistic and question any advice that sounds too optimistic.

If you're interviewing more than one realtor, be cautious if one of them values your home significantly higher than the others.

A little sunshine is good for your health, but too much will leave you burned.

If you're thinking of making a move and would like an honest valuation of your home, feel free to contact us for more info.

Say Goodbye To Your Condo!

The Toronto Star recently broke the news that Urbancorp has cancelled its Kingsclub Condominium complex on King Street West (read the article here).

In place of the condos, three towers of rental apartments are to be built instead.

What does this mean for anyone who bought a pre-construction unit in this development? Basically, they're screwed.

Yes, they'll get their deposits back. But all they'll have to show in return is a measly bit of interest .

Needless to say, these buyers are nonplussed.

When I first heard the news, I immediately thought of the South Park episode referenced in the photo at the top of this blog post. (If you haven't seen it, here's a short clip that sums up the episode nicely).

Aaaand... it's gone!

Over the past couple of weeks, I’ve had a bunch of clients ask whether or not anyone could have seen this coming.

I tell them all the same story:

I began my real estate career back in 2006, at a small boutique brokerage in the St Lawrence Market area.

My broker of record there had decades of experience in the real estate game, and had spent a handful of those years selling pre-construction condos.

He told us stories of how so many young buyers lost their deposits when the market crashed in the early 1990’s, because the units they had committed to buying were now worth 20% - 30% less than what they had agreed to pay and they could no longer get the financing they were counting on to close.

He also told us about the possibility (however rare it may be) that a condo development could indeed be cancelled if the right (or rather, wrong) set of circumstances were to occur.

These stories stuck with me, and whenever I have a client express interest in purchasing a pre-construction condo I provide them with a detailed list of "what could go wrong." And what happened at Kingsclub Condos is on that list.

Make no mistake, Urbancorp is within their legal right to do what they've done here. It still stinks though.

I keep going back to the question, "What else could these buyers have done with the deposit money that sat stagnant in a trust account for years?"

I'm sure some of them could've used that money to purchase a resale condo instead, rent it out, create some positive cashflow, and start building equity.

That opportunity is lost now though, and these buyers are back to square one.

If there's a positive to come out of this story, it's that we all now have a memorable, real-world example to point to when considering the risks involved in buying pre-construction.

Sure, what happened at Kingsclub Condos is a rare occurrence in the Toronto market, but I don't think any of us will soon forget it.

It'll stick around as a cautionary tale, the one about the time the developer told their buyers, "Kiss your condo goodbye!"

If you’re thinking of making a move and would like to know how we can help, please contact us for more info.

What Happens When A Seller Receives Zero Offers?

Zero Offers! | Toronto Condos | Toronto Lofts | Toronto Real Estate Back in August I wrote about the sellers who received 7 competing offers on offer-night, and said "no" to all of them (read it here). (Update: That house didn't sell and is now off the market.)

This month I'd like to take a look at what happens when a seller receives no offers on offer-night...

I was recently out with some clients, viewing houses for sale in the west-end of the city.

We saw six houses in total, and each one had a scheduled offer-night for the following week.

Four of those houses ended up selling on offer-night (with multiple-offers, and sale prices well above what they were listed at).

The other two houses didn't sell.

In fact, those two houses didn't receive any offers at all!

So, what options does a seller have when they receive zero offers on offer-night?

Generally, a seller will respond in one of three ways:

Response #1 - Hold Your Ground

In this case, the seller believes that the property is priced where it should be. Despite the fact that they received no offers, they're going to hold their ground and keep the list price where it is.

Response #2 - Raise The Price

Here, the seller believes that the property was underpriced initially (as part of a strategy to create a multiple-offer scenario, and an above-list sale price).

The strategy didn't pan-out on offer-night, so they terminate the listing on mls and re-list the next day at a price that's more in-line with what they're hoping to sell for.

Response #3 - Lower The Price

Here, the seller believes that receiving no offers means the property is over-priced.

They don't want to waste any more time on the market, so they respond swiftly with a reduction in price.

Truthfully, we don't see this third response very often. A seller will usually hold their ground for a few more weeks before considering a price reduction.

Response #2 (raising the price) is the one we see most often. But it doesn't always work (take a look at the greedy sellers from my August blog post as an example).

Keep in mind, these are only the three most common seller responses. There are actually others as well.

I've even seen listings receive zero offers on offer-night, then turn around and try the exact same strategy all over again: re-list the next day, at the same price, with a new offer-night...

...and it worked!

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

7 Offers... And None Of Them Were Good Enough!

7 Offers... And None Of Them Were Good Enough! Photo What happens when a seller receives 7 competing offers on their house, only to reject them all and then relist the next day at a much higher price?

Is this a smart move on the seller's part?

Or is it a stupid one?

Well, it's certainly a risky move; one that can backfire and leave the seller kicking themselves for being greedy...

There's a house for sale right now in the east-end of the city that's been on the market for almost 100 days.

The Toronto market for freehold homes has been exceptionally hot this year, and 100 days is a helluva long time for any house to sit unsold.

There must be something wrong with the house then, right?

Nope. A few layout quibbles aside, it's in great shape, in a great location, and it shows very well.

The problem is that the sellers played pricing games early on when the house was first listed for sale, and now it's priced too high & they're struggling to find a buyer.

The house was first listed back in the spring for almost $200,000 less than where it's priced now.

There was a hold-back on offers, and the sellers received 7 competing bids on "offer-night".

7 offers!

Most sellers in that position would realize their good fortune, and take the money & run.

Not these guys.

From what I hear, the listing agent was quite upset with his clients for choosing to reject all 7 offers and essentially squander the momentum that had been built-up over the week leading up to offer-night.

It sounds like the listing agent knew it would be next to impossible generate that much interest in the property again.

And he was right.

Here we are, almost 100 days later, $200,000 higher, and the house is still for sale...

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

Should You List Your Home For Sale Before A Long Weekend?

Should You List Your Home For Sale Before A Long Weekend? Photo I've mentioned in previous blog posts that the spring market shifts into its highest gear right after the Easter long weekend (read those posts here and here).

Easter also gets the ball rolling on a series of long weekends that serve as sign-posts throughout the spring and summer real estate markets.

There are 5 of these weekends in total: Easter, Victoria Day, Canada Day, August long weekend and Labour Day in early September.

On any given one of these long weekends, a portion of the real estate market (buyers, sellers and/or realtors) is going to be out of town and unable to view properties.

Listing right before one of these long weekends means that you're potentially missing out on the full pool of prospective buyers.

If given a choice, I generally advise my clients to wait another week and list on the Tuesday/Wednesday after a long weekend.

This way, we’ll (theoretically) stand a better chance at exposing the property to a greater number of people.

And market exposure is the name of the game when you're selling your property!

Does that mean I've never listed a client's home for sale right before a long weekend?

Of course not!

In fact, I have an upcoming loft listing that we may put on the market just before the Victoria Day weekend...

So it's certainly not a hard-and-fast rule.

One could actually argue that a long weekend is an excellent time to have your home on the market.

Looking back at this past Easter weekend for example, a bunch of great homes came on the market and sold with multiple-offers & above-asking sale prices.

It's possible that the long weekend allowed some buyers that extra bit of down-time they needed to really focus on their home search and put in a strong offer.

I will say that long weekends certainly make for interesting open houses…

It’s always fun to see out-of-town parents tagging along and having their minds blown at what their kids are spending half-a-million dollars on.

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

The House Sold So Fast We Didn't Even Get A Chance To See It!

The House Sold So Fast We Didn't Even Get A Chance To See It! Photo Earlier this week a gorgeous house popped up for sale in the west end.

The house was so gorgeous in fact, that it sold in a day and for more than $200,000 above the list price!

I have some clients who wanted to go take a look, but never got the chance as they're out of town until the weekend.

I'm sure they weren't the only ones who missed out.

There are easily 40+ realtors and prospective buyers who never got to step foot in the place.

Not to mention all the activity that a couple of open houses would've generated.

So, the question has to be asked, "Did the sellers leave money on the table by not exposing the property to the entire market?"

It's hard to argue with $200k over the list price.

Still... What if everyone who's in the market right now actually had the opportunity to see the property and submit a competitive offer?

Could the sellers have gotten another $25,000? Another $50,000?

There's no way of knowing.

It's actually possible that the sellers did so well because hardly anyone got to see the house.

In other words, whoever paid $200,000 over the list price was obviously very motivated to snatch the property up before anyone else had the chance.

Either way, I think this is a great example of how setting a specific "offer date" can benefit both the sellers and the buyers.

People seem to think that holding-back offers only helps sellers, by generating multiple offers and a higher sale price, but the truth is it helps buyers too.

Just look at those clients that I mentioned earlier, the one who are out of town.

A hold-back on offers would've ensured they saw the house, but instead it was listed and sold before they had the opportunity.

Remember, a house that sells in one day is only seen by the small pool of buyers who are able to drop everything at a moment’s notice.

A house that sells on offer-night is seen by the entire pool of buyers.

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

Is Overpricing Really the Best Strategy?

Is Overpricing Really the Best Strategy? Photo If you want to get the best price for your home, should you:

A. Ask for more than you think it’s worth?

B. Ask for exactly what you think it’s worth?

C. Ask for less and count on a bidding war to push you over the top?

That's the question posed by a recent Toronto Star article.

The article points to a 2013 study in the Journal of Economic Behaviour & Organization that says the correct answer is option "A" - overpricing is often the best strategy for achieving the highest sale price.

Of course, that article goes on to say that, "pricing high pays off in an extremely modest way, a boost of about $100 to $200 on average over similar homes."

Seriously? A benefit of a mere $100 to $200?

Is that a typo? Did they forget to add another zero (or two) to those numbers?

I can tell you right now that overpricing generally leads to more days on the market. Often many more days on the market.

Is the chance at a few hundred bucks really worth having to live through more showings, more open houses, low-ball offers, etc?

Isn't a better strategy to list closer to market value and sell quickly and for top dollar (relative to list price)?

Some might say that it really depends on how much "overpriced" we're talking about.

Let's say the current market value of the property is $500,000.  Listing at $509,000 is certainly a different story than listing at $529,000.

In other words, one could argue that there are degrees of overpricing.

Others might say that a property is either overpriced or it's not.

Either way, there are two important things to consider when contemplating overpricing your property:

  • How long do you want the selling process to take?
  • Do you want to run the risk of eventually having to reduce the list price and then end up selling for less than you would have if you'd listed closer to market value in the first place?

Below is the Toronto Star article in full.  Enjoy!

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How Best To Set Your Home's Selling Price?

by: Toronto Star Wire Services, Published on Fri Nov 8 2013

If you want to get the best price for your home, should you:

A. Ask for more than you think it’s worth?

B. Ask for exactly what you think it’s worth?

C. Ask for less and count on a bidding war to push you over the top?

A study in the Journal of Economic Behavior & Organization this year argues that the answer—despite what you’ve probably heard—is A: overprice.

They suggest that pricing high pays off in an extremely modest way, a boost of about $100 to $200 on average over similar homes. Underpricing in the hope of setting off a bidding war, the study says, nets average sellers a bit less than they otherwise would have received.

“The main takeaway for sellers is to not buy into the story that you will make more money if you under price,” said study co-author Julia A. Minson, an assistant professor of public policy at Harvard University’s Kennedy School of Government.

Whether overpricing is a smart strategy—as opposed to right-on-the-nose pricing—might depend on how quickly you want to sell.

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

WTF? Showings Are Only Allowed On Thursdays, 6:00 - 9:00pm!

What The Heck? Showings Are Allowed On Thursdays Only, 6:00 - 9:00pm Photo I was booking showings for a client the other day and one of the properties we wanted to see was restricting showings to Thursday evenings only, 6:00 - 9:00pm.

My client was only available on Wednesday that week, so we had to skip that particular property.

Too bad. It coulda been a contender.

When listing your home for sale there's a handful of HUGELY important things you need to do if you want maximize your odds of selling quickly and for top dollar.

One of those things is be as flexible as possible with showings.

Someone wants to come take a look at 8:00am on a Saturday morning? Let 'em.

Someone wants to get in at 9:00pm on a Tuesday? Let 'em.

Is being totally flexible with showings going to add a bit of stress to the selling process. Yes, likely. But it's worth it.

What if a potential buyer is only in town for a day or two? Refusing their request for a showing means there's no way they'll ever get to see your property.

"They'll reschedule if they're really interested in seeing the place".

Maybe. Hopefully.

It doesn't always happen though. In fact, I'd say that most of the time buyers move on to viewing other properties and never look back.

Selling your property is an odds game in some ways. The more potential buyers you allow to come through, the odds of selling increases.

Now, if you have a baby or small children at home that certainly changes things. I have a 15 month-old and I probably wouldn't allow showings past 8:00pm. If there was no way that the buyer could reschedule tough, I'd try to work something out.

If I thought that the property could sell within just a few days, I'd maybe consider not living there at all during the listing.

Either way, I'd do my darndest to avoid shutting the door in a potential buyer's face.

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

Don't List Your Home On The Weekend

Don't List Your Home On A Weekend As a realtor, I have access to up-to-the minute updates on mls. And I'm checking-in periodically throughout the day, scanning the hot listings for anything that might be a good match for my buyer clients.

Additionally, I have all of my clients set-up to receive daily automated emails with any new listings that hit the market the day before. For example, they receive an email early Tuesday morning with listings that were posted between 12:00am and 11:59pm on Monday.

So, regardless of whether or not I forward a specific listing that looks good, they are still going to see a full list of everything that hits the market. This is a great way for them to get a sense of what's popping-up in their price range, and it provides context for when a really great listing does come along.

Of course, I'm not the only realtor who does this. Every morning, all over the city, buyers receive automated emails with links to new listings that were posted on MLS the previous day.

I'd say the majority of these automated emails arrive on Tuesdays, Wednesdays, and Thursdays. They arrive on Fridays as well, although this is less common.

What about Saturdays and Sundays?

Simply put, Saturdays and Sundays are less-than-ideal days to have your property reach the market.

By the time Saturday rolls around, buyers and realtors have already compiled their list of properties to view for the weekend. Anything that lands in their inbox on Sat/Sun is more likely to fall through the cracks.

The odds are just better that a buyer is going to see your newly listed home if it's put in front of them on a weekday.

Sifting through the MLS updates becomes a part of many buyers' Mon-Fri routine. They open the links in the morning at breakfast, then they connect with their realtor during the day to highlight the best of the bunch, then they run through them again at home later that night. It becomes ritual. A weekday ritual.

That's not to say that buyers aren't looking at listings on Saturdays and Sundays. Real estate is addictive and many buyers are plugged-in 24/7.

Generally though, weekends are spent on social obligations, trips away from the city, and running a week's worth of errands.

Not to mention that weekends are when a lot of buyers are actually out viewing properties!

Despite all of the above, sellers still list on Fridays and Saturdays (which means buyers see these listings on Saturdays and Sundays).

Why?

Why would a seller (and/or their realtor) actually choose to have their home pop up on a Saturday or Sunday?

Why would they choose to have their most valuable asset make its debut on a day when the least number of potential buyers are going to catch it?

I think there are probably two main reasons;

Some realtors struggle with the ins-and-outs of how to best market a home.

It's no mistake that a lot of the listings I see pop up on Sat/Sun are also the ones that have crappy photos...

Some realtors are afraid that waiting a few more days to list will also be giving the seller a few more days to possibly change their mind.

Sad but true. Some realtors have been burned in the past and they think, "Hey, I need to get this place under contract and listed IMMEDIATELY, whether or not it's what's best for the seller."

I think there's a third reason to consider as well. It's possible that, despite their realtor's advice, some sellers are in a position where they need/want their home on the market ASAP. "Saturday, Sunday, Christmas Eve, New Year's Day... doesn't matter. We need it on the market NOW."

And what's a realtor to do in that situation? Of course they're going to list the property. They've given their best advice and now they're going to follow their client's directions.

For those sellers who have the option of waiting just a few more days though, listing on a weekday is almost always the way to go.

And if you're realtor is insisting that timing isn't crucially important to a successful listing, maybe it's time to find another realtor.

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

 

How Important Is The View?

How Important Is The View? Photo With so many new condo buildings popping up, great views are getting much harder to come by. Heck, even decent views are getting harder to come by.

So, if you're selling your condo and it's got an exceptional view - shout it from the rooftops!

I recently had a condo listing in the Yorkville/Bloor area.

The last comparable sale in the building was listed and then re-listed twice before finally selling. It was on the market for a total of 158 days.

Our's sold in just 2 days. And for 103% of the list price.

Why the difference?

While I'd like to think it all came down to my exceptional skill as a realtor, I have to admit there was another factor at play as well: Our unit had an incredible view and the other one didn't.

The other unit was on a much lower floor and stared directly into the brick wall of the building next door.

Our unit was located all the way up in the 35th floor and had a an unobstructed view.

It was quite something, actually. You faced east and could see over the Rosedale Valley and downtown all the way to Lake Ontario.

Needless to say, playing this up in the marketing of the property was a no-brainer.

The photos, the virtual tour, the feature sheets & the online advertising all highlighted the incredible view.

And it served us well.

We ended up setting a record price for that layout in the building.

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

 

 

 

 

 

 

"Multiple-Offers" And "Bidding Wars" Don't Always Go Hand In Hand

"Multiple-Offers" And "Bidding Wars" Don't Always Go Hand In Hand Photo Last month I wrote a blog post about multiple offers (read it here). Among other things, I noted that having “multiple offers" on a property doesn't always necessitate a "bidding war".

Of the properties I've sold with multiple-offers so far this year, one actually sold for under the list price and another sold for only $100.00 over. (I represented the buyer in both cases).

Both properties sold for close to what other recent sales went for, and neither of these situations came anywhere close to being a "bidding war".

Why?

For starters, both of these properties were condos. It’s true that the condo market has cooled a bit and the buying activity isn’t as frenzied as it was a year ago. (Houses are a different story...).

Secondly, both properties were priced fairly to begin with (as opposed to being intentionally "under priced") and the sellers were allowing for offers at any time (as opposed to scheduling a specific "offer night").

In other words, neither listing was attempting to orchestrate a bidding war scenario and the fact that they happened to receive multiple offers was a matter of lucky timing more than anything else.

Even when there is a scheduled offer night and a property receives multiple offers, the prospective buyers don't always end up in a bidding war.

As long as cool heads prevail and everyone comes to the table with their top number in mind (and the good sense to NOT exceed that top number), then a bonafide bidding war isn't going to happen.

Throw emotion (and deep pockets) into the mix though...

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

 

Multiple-Offers Aren't Going Away Anytime Soon

Multiple-Offers Aren't Going Away Anytime Soon Photo There was quite a bit of talk in the media this past fall & winter about a real estate bubble and an imminent correction.

Out on the streets though, I think most Toronto realtors would say that they don't see any kind of major adjustment happening.

Did things slow down over the last 6 months? Certainly (although more so with condos than houses). Sale prices levelled-off in some areas and buying activity eased up a bit. The new mortgage rules that were implemented in July had a lot to do with this.

Looking at the first few months of 2013 though, it's the realtors - not the media - who are right once again.

From what I'm seeing, there are plenty of buyers out there right now looking at homes and making offers. And depending on the neighbourhood & quality of product, supply isn't meeting demand.

Two of the last three properties I sold had multiple offers on them.

Remember though, "multiple-offers" doesn't always mean a "bidding war".

Of the two properties I mentioned above, one actually sold for under the list price and the other sold for only $100.00 over.

What multiple-offers do show is that buyer confidence is there.

Many in the industry are predicting a very active spring market for 2013. I don't disagree.

As long as interest rates are low and supply of quality product is tight, multiple-offers aren't going away anytime soon.

 

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.

 

 

 

Would You Buy A Haunted House?

Every buyer has a list of wants and needs when shopping for real estate.

No home is perfect though and there's always going to be some element of compromise. As the search progresses the question becomes, "What are your deal breakers and what are you willing to bend on?"

Some buyers are willing to stretch the geographical boundaries of their search and consider locations outside of their preferred area if it means getting the size of home they want. Others are willing to give up some outdoor space in exchange for a great interior.

What about a house that's haunted?

Are there actually buyers out there who would seriously consider purchasing a property that was known to have paranormal activity?

Apparently there are. I came across a 2008 article from the Toronto Star about a Meaford, Ontario home that's haunted. At the end of the article the listing agent says he's received calls from potential buyers who tell him that, "moving into a haunted house wouldn't bother them at all."

Seriously?!

Check out the article below...

———————————————————–

Is Meaford Dream Home Haunted?

Toronto Star | By Roberta Avery | October 25, 2008

Rachael Chapman is not easily spooked.

After a fashion modelling career that took her to New York and London, Chapman, 33, travelled the world as a flight attendant before moving to a remote rural area near the Georgian Bay community of Meaford, where she lived alone in an old farmhouse with her young son, Adrian.

"We were miles from anywhere, but I wasn't at all nervous," she says.

Then last year, just before Halloween, Chapman and her partner, David MacLeod, decided to buy a home together.

The older three-bedroom, two-bathroom home they purchased for $164,000 on a tree-lined street just a few minutes' walk from downtown Meaford has a large private backyard, so it appeared to be ideal for Adrian, now 13, as well as MacLeod's 12-year-old son, Brian, and the baby the couple was expecting.

"We thought we had found our dream home," she says.

The family has not lived in the house since May, although they struggle to make the mortgage payments while paying rent on another home, she explains, while reluctantly unlocking the door.

Chapman's self-confident demeanour disappears when she steps into the kitchen that feels icy cold, although it's a warm and sunny October day. The fully furnished house is neat as a pin with children's toys tidily stacked on shelves, an empty baby's crib and family keepsakes and photographs on display.

"We left our things behind because we were scared that we would take whatever it is that's here with us," she says.

Although she loved the home at first sight, there was something about it that made her ask the realtor if anybody had died in the home, she says.

"I was assured that no one had died here," she says.

There is a ground floor master bedroom and another room they decorated as a nursery for their baby, due in January. Upstairs are the two bedrooms she thought ideal for their two boys.

"Shortly after moving into the home, we began to notice strange happenings," Chapman says.

At first the couple tried rational explanations for the loud banging noises from upstairs, which happened at times when all the family and the pets were downstairs.

"We explored the possibility that animals had taken refuge in our attic or that branches could have been rubbing against the house or rooftop, but there was no evidence of any such cause," she says.

The boys were ill at ease and refused to enter certain rooms. One said he woke to a feeling that he was being choked.

"We chalked it up to the children having vivid imaginations and talked to them at length about the inappropriate nature of their stories," she says.

Things began to escalate: appliances and lights turned themselves on and off, things went missing and turned up in strange places. While they slept, a plaster column in the kitchen smashed as if hit by a baseball bat, and also while they slept, their phones called people.

Although they are not religious, in May they asked a minister to bless the house, but after he left, events escalated further. Their cellphones started beeping, indicating there was no signal. Chapman felt that she was being watched and had an overwhelming sense of foreboding.

That night Chapman took Adrian and then-five-month-old Locklyn and went to stay with her mother, who lived a few blocks away. MacLeod initially refused to join them, but just a few hours later, when the furniture started moving and he heard what sounded like a woman screaming when he picked up the telephone, he also left, she says.

Since they moved, neighbours have called them to report lights going on and off in the securely locked home and on one occasion, the hard-wired fire alarms started beeping, although they were disconnected and didn't have battery backup, she says.

Chapman expected her story to be dismissed as unbelievable, but when she started asking around town, she soon discovered the house had a reputation for strange occurrences dating back decades.

"It seems that everyone knew but us," she says.

Chapman's research at the Grey County records office indicates that at least two men died in the home, one who suffered from sleep apnea and choked to death in his sleep, and another who committed suicide in the living room. The county paper records, which go back to 1945, indicate the house has changed hands numerous times, with people rarely staying for more than 12 months, she says.

"That's really odd, because in 1945 people usually bought a home and lived in it for life," she says.

It doesn't take long to discover that, just as Chapman asserts, the house does have a reputation for being haunted. A few inquiries at the local coffee shop turned up several tales of the unexplained, relating to the house, but no one wanted to be quoted.

Meanwhile, Chapman and MacLeod have put the house up for sale for $184,900 in the hopes of breaking even after legal and realtor fees, but so far, prospective purchasers have lost interest once the realtor advises them that the house is haunted, Chapman says.

Legal expert and Star columnist Bob Aaron says that with the exception of Quebec – which has laws requiring disclosure of property stigma – rules for the rest of Canada are weak.

"In general, the rule is caveat emptor, or buyer beware," he says.

Chapman and MacLeod's realtor, Murray Petch, a broker at Wilfred McIntee & Co. Ltd. in Meaford, confirms in a telephone call that he advises potential purchasers there have been reports of paranormal activity in the house.

"I wasn't aware of it, but now I know, I'm obliged to tell," he says. "But it's okay, there are people who say moving into a haunted house wouldn't bother them at all."

If you’re thinking of making a move and would like to know how we can help, feel free to contact us for more info.

You Can't Always Tell From The Photos

Trick-Photo.jpg

It goes without saying that high-quality professional photos are an EXTREMELY important part of any realtor’s marketing plan when it comes to selling a property. At least they should be...

I see listings all the time that have cheap, unprofessional photos. Or worse - no photos at all!

Quality aside, what about photos that don’t accurately represent the property?

I recently showed two houses to some clients of mine; one that failed (miserably) to live up to the glory the photos had promised and one that actually turned out to be a real gem, despite what the photos suggested.

With the first house, the photos and virtual tour made the place look immaculate. We stepped inside expecting to see a solid reno in move-in condition. Instead, we found quite a bit of wear-and-tear on the hardwood floors, a half-finished basement, and some major sloping on the second floor.

With the second house, the online marketing made the place look a lot darker and more dated than it really was. We weren’t expecting much and were quite surprised to see just how much natural light there was when we stepped inside.

In both cases, the photos fell short of showing us what the properties truly had to offer.

I’m sure that the photos for the first house brought in plenty of potential buyers. However most of those buyers were no doubt disappointed with what they saw once inside and moved on to the next property on their list.

And I’ll bet the photos for the second house actually scared off a number of potential buyers. Some of those buyers might have considered making an offer if they’d come to see the place in person.

Keep in mind that when you’re searching for properties online, you can’t always tell what's what from the photos. Nothing beats visiting a property in person and seeing for real if the place is as good... or as bad... as the photos say it is.

If you’re thinking of making a move and would like to know how I can help, feel free to contact me for more info.