How Fast Is Fast Enough?

9.69 Seconds is as fast as anyone has gone to date.

How fast will your house sell?

Home selling is a balance of the Home Selling Trifecta. More commonly know as Product, Price, Exposure. If one of these three essential elements is off, you will have issues in selling your home.

The knock most people have with Private Sale is the perception that they are limiting their exposure and extending the time they need to sell their house. Back pre-internet I would tend to agree. Today's private sale marketing companies get you the exposure that you need in order to get in front of buyers. Where this perception comes from is not from the exposure angle of the Trifecta but the other two components.

Product and Price are key in order to sell your home. They HAVE to be in alignment. If you are sitting with a $200,000 house and asking $230,000 people hit the next button on the computer screen. The decision is made without you even knowing.

As Private Sale Professionals we encounter more real estate transactions than that of the average home seller. We see people make good and bad decisions every day. To watch someone give up on private sale and reduce their price when they list with an agent does not comprehend. Let me give you some examples.

140 Peeblecreek Dr in Kitchener had listed with PropertyGuys.com in April 2008 for $384,900. In July they opted for the Realtor route. We last saw them on the MLS system on Feb 26 2009 after it had been listed for 224 days with an agent and had dropped the price to $349,988. A difference of $34,912 not including the estimated $17,000+ in commission. All that and they still had to wait 2/3 of a year!

17 Harrow Ct in Guelph listed at $460,000 with PropertyGuys.com in January 2008. After being listed a mere 66 days and dropping their price to $419,500 they opted to leave for the "greener pastures" of the MLS. Pastures grew, dried up, got covered in snow and were finally thinking of sprouting again this March when things finally showed promise and they sold. A harrowing 344 days with an agent and their last listing price on MLS was $369,000. A difference of $50,500 from their last price on PropertyGuys.com not including an estimated $18,000+ in commission.

61 Clive Ave in Guelph originally listed with PropertyGuys.com in June of 2008 for $349,000. After a few months on the market and price drops to $329,900 with no takers they opted to change their marketing strategy. Agents had been relentlessly telling them that they can get more money for their house, all they had to do was list and get the exposure that comes with from the wonderful world of the MLS. They listed with an agent in August at $340,000. After months of going nowhere except down in price ($319,900 is where they ended up) they opted to come back to PropertyGuys.com in early December. Doing the math they realized that even if they could have sold with an agent at $319,900 they would have ended up with $303,905 after commissions were paid. Knowing they needed to be more flexible they adjusted their price to $309,900. This seemed to put their Product/Price ratio into alignment because just after the Christmas holidays they had a sold sign on their lawn and a little over 95% of their new asking price.

Any athlete knows your performance does not happen out on the track. It all happens in the training. You must prepare yourself for the meet with countless hours of workouts to ensure when the pistol goes off you are ready to run down that track to victory.

Don't tense up and let the lactic acid build up and kill your finish, as Darrin says, "keep flexible"!

M

Pricing Is The New Black

It doesn't get anymore basic.

I have had some discussions with local agents over the last few weeks. It is no surprise they all feel the key to selling a house quickly is pricing it accurately from the get go.

As a home seller it is imperative that you price accurately in order to be succesfull in selling your home. Local PropertyGuys.com clients have boasted getting offers within hours of getting listed on the website, even before a sign on the lawn. This would not happen if they were $10,000 over priced.

One of the benefits of selling privately is the ability to be more flexible in your pricing. Cutting out the most expensive portion of the selling process allows you the ability to negotiate, even better you can be more aggressive up front while your listing is still fresh.

How do you know if you are priced right? First and foremost did you get QUALITY information in the beginning? You can easily watch the market to see where people are listing their homes for sale. Problem is to get a true idea of where the market is you need to know what they sold for. That information is pretty hard to come by unless you have access as an agent or appraiser.

You can have any agent come in and give you an opinion on value. Problem is that their opinion can be enticed by the large payday looming. Third party appraisers are an irreplaceable resource. They give you a value on your home, no strings attached.



If you are already on the market look around and see how you compare to the homes in your neighbourhood. If you are near the top of the list you may need to rethink your strategy. You don't want to be the one wearing the purple dress do you?

M

A Little Q & A

You ask and I answer!

My last post seemed to drum up some discussion and it got me thinking. What others topics are out there that people might want some answers to? If you have something that is a burning issue or that you can't get a straight answer to, drop me a line. This blog thing might as well be interactive, right?

Here is a question and answer dialogue that might have taken place on a typical website:

Q. We recently attempted to put an offer on a house with the condition that ours sells. The agent that has the house listed has informed us that we NEED to first list our own home with an agent before our offer could be considered – is this true?

A. This is definitely not true. Private sale has grown both in comfort level and popularity as the internet has gained momentum - and is now considered a mainstream alternative to traditional agents. It’s estimated that 25% of sellers are now choosing private sale and if 1 in 4 are trying it and experiencing the same success rates as those with agents then it cannot be denied as a credible strategy for selling. In fact, in many circumstances private sale has proven to be more effective than traditional because the seller’s asking price has not been inflated to pay commission. This allows the seller to price closer to what people are willing to pay, and therefore increases the likely hood of selling. The best defense against this type of scenario would be for you to go knock on the front door, and make the offer in person. The home seller can then decide if they want to consider the offer or not.

This is a pretty straight forward answer to the question. I try to lay things out with as much clarity as possible. In my opinion this type of action is morally and ethically wrong. As a Canadian citizen you have the right to sell your home how you please and you should not have anyone putting undue pressure on you in order to line their pockets. Your offer as a private seller is as good as that from an agent. In fact it has potential to be better! Without the high cost of commissions you can be more aggressive with your price which attracts more buyers. If this circumstance were to happen to you I would suggest that you advise the agent that the offer is conditional and they will have every right to continue to offer the home for sale. Any better offers will end up bumping yours in most cases so what's to loose?

We have seen many instances of this locally. If you or anyone you know has fallen victim to this type of deception by an agent let me know. Collectively your voice is louder and we will help you stop this from happening to someone else.

Here is a guy that should have used his phone a friend to call a Private Sale Professional.


M

Feeling Violated?

Are you outraged about your equity being ravished?

Last Friday a gentleman by the name of Mark Fox wrote a provocative blog post entitled Death Of The Realtor. Mark is a very interesting person. Now a corporate trainer and author he has an impressive resume including rocket scientist. A person not to be misdirected by fluff.

I first learned about the post when I saw it on twitter. What makes it so provocative? Mark likens paying 6% commission in a real estate transaction to rape; loss of control specifically. The use of this feeling of violation is an interesting one. It stirs up an emotion, one that could conjure up guilt in the most ethical of real estate agents. The ones that are lacking scruples won't even bat an eye. Let me give you an example.

I met with a friend of mine this week to discuss the listing of his house. He and his wife got a call from a local agent that wanted to show them a great little fixer-upper. They fell in love with the potential of this house and decided to put in an offer. Knowing the agent they felt comfortable having him work both sides of the deal. They put in a strong offer conditional on the sale of their property. This friend of mine is no rookie in the housing market. Having sold his two previous homes privately he was excited to get it on the market once the offer was accepted.

Knowing the way some real estate agents manipulate clients with trust I gave him a warning. Although some agents have strong ethics and want the best for their clients we have experienced many local agents that thought more of their own pocket books then the financial concerns of the client. Sure enough the offer that was presented was not just conditional on the sale of their property. It was dependent on them listing their property on MLS. That's when it was explained to the agent that they were going to sell privately. The real estate agent said he would take this "new offer" back to the seller to see what they thought. Here is where the real depredation of trust happens. Why would the seller care how the buyer chose to sell their house? Price it properly and get it on the market!

When the agent came back with the news the seller would not accept the offer unless they listed on MLS it became obvious that this agent was not out for the best interest of his clients but only for his own personal financial gain. If he was looking after the clients' best interest why would he force the buyer to have to add an additional $8,000 to the selling price of their house? How is this in the best interest of either buyer OR seller?

Realtors might argue that the agent is working in best interest of the seller because for a home to sell it needs to be listed on the MLS. I beg to differ. Stats for the last 6 months in Waterloo Wellington show that only 43% of homes sold with the high profile marketing of realtors and the MLS while the clients of PropertyGuys.com bettered the agents by selling 46% of homes in the same time period.

Why is that? Why would homes listed privately have a better chance of selling over those listed on MLS?

Private home sellers are in control. No one ravishes their pocket book. They are able to flaunt their lower price out to the market without fear of someone pillaging what is rightfully theirs.



M

On The Upswing?

Life at the park.


In my monthly stats post for February I predicted March MLS solds based upon their slumping sales to date. The good news is the market out performed my prediction, which means things are improving.

Cambridge ended March with 209 solds (I predicted 175), Guelph came up with 241 (I predicted 210) and KW had 497 (I predicted 470). All in all the Waterloo Wellington MLS market was down by over 17% versus last year and nearly 24% from the record 2007 numbers.

How is this an upswing if we are on a downward trend? I would liken it more to a pilot pulling up on the stick as they plummet in a stall hoping to level off before the unfortunate ordeal of an unplanned landing.


M

She's So Funky Ya

Kate Bush is not that "funky", no matter how hard she tries.

When I was growing up so many people thought the song Games Without Frontiers by Peter Gabriel had the repetitive line of "She's so funky ya". Do you remember it? Everyone singing it at the tops of their lungs "SHE'S SO FUNKY YA". In actuality it was simply the title in french "Jeux Sans Frontières" as sung by Kate Bush.



We often think we know something when truth be known we have no clue. If you are missing information (like knowledge of french) it makes it difficult to even know that you are wrong. We see this in the housing market. A sign goes up, hangs around for a while, comes down. A new sign goes up and miraculously a sold sticker. Must have been that new sign, right? Not so much.

When one lists their house for sale they usually do so with the best of intentions. In turn they are also trying to get the most out of their investment. Problem is so many people price their home from what they want or need to get from it not taking into consideration market price. This usually leads to the home being overpriced and on the market for an extended amount of time. The home seller eventually places blame on the person they listed with and looks for another alternative (a different sign).

This new sign comes in with a solid case for adjusting the price. Rightfully so, if your house has been on the market for 2-3 months you are more than likely priced too high. Once the new sign (along with the new price) get onto the market SHAZAM a sold sticker. Was it the sign or simply the adjustment of price?

A home priced right for the market will sell. If your home is listed now and things are not going the way you had hoped, you may need to adjust your price. If you are looking at the bottom line after paying an agent 5% of the value of your home and saying there is no room to adjust your price, it may be time to switch from the square sign on your lawn to a round one.

M

Why Waste Your Time?

"I have to pay how much in commission?"

Seriously, when you look at "The Scream" by Edvard Munch what thoughts does it conjure up? When you see the colours and the details how does it make you feel? Did you ever notice that there are actually 3 people in the painting? What about the ships on the water in the background?

Have you put as much effort into your photos as you have your description? Chances are the photos will say more than you could ever write. The old saying of "A picture is worth a 1000 words" can work for you or against you. If you have not paid enough attention to your photos it speaks volumes to your prospective buyers. Everything from the quality of the photo to the cleanliness of the room screams from the photos.

A not-so-recent article in the Globe & Mail points out the importance of good real estate photography. You have to pay attention to the entire frame as well as ensure you are seeing the entire room. You are not selling your couch or dining room set so why would that be the focus of your photo? If you do not have a wide angle lens I would suggest you allow someone else to take the photos. If the person coming to take photos of your home does not tell you to take the magnets off the fridge or that it would be best to tidy up the kids toys, why are they there? It is more than just taking a few snaps and loading them on a website.

It does not stop with just the photos either. Your virtual tours need to be top rate as well. Not like this "Real Estate Professional"...


M

Dirty Deeds...

Do you think any of them will help you in the garden?

Can you feel it? That dull ache in your lower back. The one caused by countless hours of shoveling, raking, digging and planting?

Spring is upon us and that means it is time to get out and spruce up the yard. The first impression your home gives is an important one. Keeping the lawn in good shape, the garden beds weeded and the bushes pruned ads to the value of your home, not to mention curb appeal. Having a prospective buyer pull up and say "I think this is the place" before they even step foot on the property is the aim of every home seller (or it should be).

What is the first step? Call the garden center and get some dirt delivered? Problem is one of two things will happen. You will end up with a big messy pile of dirt on your driveway or a large unsightly yellow bag where your car should be. There has to be a better solution.

There is...


For those of you that expected an AC/DC video, here is a rare Live Bon Scott one


M

Are You Eating Ham or Turkey?

I know what his vote is.

Easter is upon us. Family, food, chocolate and hopefully the end of winter like weather.

Like so many people this holiday we have family visiting us. If you are thinking of selling your home in the next little while take full advantage of these extra eyes (and backs). When a visitor arrives at your door, sweet potato pie in hand, ask them to imagine they were looking at buying your house. Don't let them in until they agree. They need to be judgmental and harsh. This usually is no problem for most relatives.

Have each and every person give you their 3 favorite and 3 least favorite aspects of your home. Having these additional eyes and opinions will prepare you for the buyer onslaught. Since they were nice enough to tell you they didn't like the layout of your living room, put them to work to move furniture. Maybe even send them home with an end table that you just don't need.

Give in the spirit of Easter!

To get you ready for your furniture moving here is a little something to get your blood flowing.


M

Kitchener Waterloo Monthly Stats

The horse is dead, stop beating it.

I commend Karen Shartun (KW Real Estate Board President) for trying to put a positive spin on the economy. The traditional media has put enough negative spin on this whole thing we could use some good news. Problem is we need information that is not misleading us.

In another article in the KW Record Ms. Shartun says "the positive momentum suggests the market has turned the corner". Truth is this is nothing special. The "momentum" of the spring market is all part of our normal cyclical nature. More houses sell in the spring and summer then in the fall and winter, FACT.

A better perspective to look at this would have been "Sales for January in KW were down 36% year over year and 28% for February. In March we are seeing that number shrink as MLS sales are only down 18% vs a year ago. Not only are we seeing the seasonal increases that we do every year but the gap to last year is closing as the economy settles down."

On another positive note PropertyGuys.com numbers for KW in March show that client sales were even with last year. If we look at the entire Waterloo Wellington area PropertyGuys.com clients sold 26% more homes this March than last March.

You would think that by know their arm would be getting sore.


M

So How Did This All Happen?

More importantly where did it all go?

We have all read the stories in the newspapers. We have all seen the reports on TV. Does anyone really understand what happened to the US economy? Is it as simple as banks lending money to people who could not afford to pay it back? If it were stock markets would not have crashed the way they did.

Here is a video that takes you through sub-prime mortgages, Wall Street vs. Main Street, and credit default swaps. Visualization is much easier to comprehend then the Wall Street Journal.

My favorite part is the depiction of the "less responsible"!

So what is next for those of us on Main Street? Hunker down, pay off your debt and get back on the right side of the balance sheet. With interest rates so low you can pay off your debts (mortgage, credit card, line of credit) quicker and easier. Extra payments on your mortgage or increasing your monthly payments are applied directly to the principle.

M

Nothing Like A Good Chicken Leg!

Now all you need is a BBQ to cook them on...

Do you remember my post about the client that was sick of annoying agents calling and knocking on his door? He had asked for some ammunition to help fend these pests off.

Glad to announce in under 3 months Peter and Nancy were able to sell their house and pay themselves the commission. They sold for 98.5% of their asking price and saved $17,325 including GST. They spent some money to market their home, in total $1,028.70, giving them a net total of $16,296.30 more than if they had of used an agent. I am not sure what they will use their extra cash for but I know one thing, they won't be wasting it on something they can do themselves!

Today I am going to share with you a few of the many things you can spend your money on instead of some Joe Schmoe agent.

1. Put it towards your mortgage - This is by far the best use of these funds (IMHO). Putting this money down on a $200,000 mortgage (based on a 25 year amortization and 4% interest rate) would save you an additional $9,418.52. That means you would end up saving over $25,000 by selling privately!
2. Pay for upgrades in a "new home" - If you are buying a new home you know that it never comes "fully equipped". Did you want hardwood floors? What about upgraded cabinets or a finished basement?
3. Make some changes in the home "new to you" - When you buy a resale home it is generally not perfect. Maybe you need a new water softener ($1,000 and up), high efficiency furnace ($3,500-$6,000), new A/C ($2,000 - $3,000), new roof ($2.50-$8.00/sq.ft.). Here is a great list of expected costs.
4. You sold the your place with appliances and now need to replace - Fridge ($2,500), Stove ($1,800), Washer & Dryer ($1,850)
5. Upgrade the backyard - New deck, Landscaping, Gas Grill for the chicken legs!
   
6. Your new place has a space for a kick butt man cave - TV ($3,000), Surround Sound ($3,500)
7. You decide that you want a spa in your basement - Hot tub ($4,700), Sauna ($3,400), Massage table ($500)
8. Send your child to University (1st year tuition and books)- Optometry ($16,100), Computer Science ($12,000), Architecture ($10,900)
9. Deposit on a new convertable or a new Harley Davidson.

I could go on and on. The point here is that you have the ability to make a choice how you want to spend your money. Whatever floats your boat. Don't let anyone tell you how you should spend it. If you want to use it for a real estate agent, by all means, it's your money.

One year ago today Joe Lima used some of his new found money to give back to his community. That's always a good idea.


M

Home Show Bullies

Sometimes you have to fight no matter the odds.

Did you hear about Remax suing a small South Carolina real estate agency over their logo? They claim that it was a trade mark infringement yet the logo didn't even resemble Remax's. Seriously, you be the judge...

They eventually dropped the suit, due in large part to the negative backlash by the press and in social media outlets. It seems that Remax has a reputation of trying to be the bully against small and medium sized businesses. You hear rumours and stories about it but until it becomes a a part of your reality you never imagine the power of big money.

This past week-end was the annual spring home show at the Aud in Kitchener. For the third consecutive year we were very excited as it hastily approached. 2008 proved to be a success and we committed to the same booth space for 2009 well in advance (last summer). We borrowed our main concept this year from an idea another franchisee had and made arrangements to have a Harley Davidson Super Glide in our booth. We noticed in the pre-show material that Remax had not only came in as the major sponsor for the show but was also located right across the aisle from our booth (B127). With a very attractive value proposition we were thrilled about the opportunity to take on this giant face to face.

With out getting into the finest of details after the first day we were relocated out of the main show area and into the hallway between the two arenas (LL02/LL03). Not the most professional place by any means. We were given a partial refund and the impression that we would not be welcome back next year. This is not the first time a PropertyGuys.com franchise has seen this happen. PropertyGuys.com St. John's NFLD ran into it when Remax came in and sponsored the local home show. They went from being voted "Best Marketing of New Homes" in the single booth category in the 2006 show to "not allowed to participate" in 2007. This is their way to control the market. Large companies like Remax come in, throw money at the organizer, flex their muscle and try to suffocate smaller more attractive options.

Last time I checked Canada was a place where we are all entitled to compete in a free and open market. In Canada we have a government agency "overseeing" this type of thing. The Competition Bureau has a mandate to help small companies in this situation. Here is a quote from their Website:

"ensure that small and medium-sized enterprises have an equitable opportunity to participate in the Canadian economy"

When you look through the exhibitor list from the home show you will see many competing businesses throughout the list. I did a quick summary and came up with a list of some of the categories:

• Landscaping x 13 Companies
• Heating and Cooling x 10 Companies
• Windows and Doors x 9 Companies
• Roofing x 8 Companies
• Financial Services x 8 Companies
• Painters x 6 Companies
• Flooring x 5 Companies
• Fences and Decks x 4 Companies
• Water Services x 4 Companies

If there was only one company from each of these services allowed in the show would they even have a show? How can one company dictate if their competitors are allowed to attend when clearly the event is based upon allowing fair and open competition giving greater choice to the consumer creating the draw? We had a videographer at the show to interview other attendees and I thought we would have a walk through to give you our prospective of the move.



The choice of which service you should choose should not be decided by the company with the biggest bank account but by you the consumer, after all it is the Canadian way. If you want to lodge a complaint against Remax to help preserve your rights as a consumer you can do so here. I would also welcome your comments here on the blog.

Hope to see you next year @ the Aud!

M