The Montreal Real Estate Blog

You started out with a high listing price. It’s been a while since your property is for sale…and no offers.

What could be wrong?

The property is in a hot neighbourhood, so the location is not the problem.

The conditions are great; top-notch with lots of renovations. You even got complemented on the décor and how well maintained it was.

Then why are there no offers?

Could it be the price?

After giving it some thought, you realized that perhaps, the reason why those few visitors never made an offer is because your property might be over the market value.

And you should know what the market value is…

Before listing your property, you checked the MLS for the current listings in your area, compared to similar properties, called an agent to give you a free home evaluation (just to make sure) and got a sheet called the “Comparable Market Analysis” (CMA), then decided what the asking price should be - regardless of what that CMA thingy said about the suggested asking price. Did you not?

Ok.

Now your property is NOT selling. What do you do next?

You drop the price. But, by now it might be a little too late. Your property is old news.

(The Risks of) selling your home above market price.

Let’s say you finally get an accepted offer for your house, from an uninformed buyer.

Like most buyers out there, they will need a mortgage; in these situations the offer to purchase is conditional to mortgage approval. No mortgage, no deal.

When receiving the (signed and final) offer to purchase, the mortgage lender requires an appraisal of the property before they consent to the financing. If the current market conditions and the comparable sales for the last six months do not support your sales price, the banks won’t approve it.

The lender will give their own appraisal to the buyer, and the amount they are willing to lend based on that evaluation. If the buyer is putting 20% down payment, the bank will finance 80%. Not a penny more. Which means: the buyers have to get more money, so they can afford your property.

And your deal falls through.

If the buyer is still interested, you can try to re-negotiate the price or the terms. But if not, your property could go back on the market.

Remember:

The longer a home sits on the market, the harder it is to get a good offer.

Once the offer expires, your property is available for new visits, but by now any informed potential buyer who kept an eye on your property will know there were offers on the table, and if they don’t know they will ask. It is your responsibility (or your listing agent’s) to reveal the reasons why the deal didn’t go through, without disclosing the previous accepted price.

There’s nothing more frustrating than having all the ingredients for a successful sale, (pre-approved buyer, a good inspection report, etc.) and then having the bank refusing to lend the money because the property “Is not worth that amount”

New buyers interested in making an offer will think that since the property has been on the market so long; the owner might be desperate to sell by now, and making a low-ball offer will probably get accepted.

By starting out with a high listing price, you could end up selling for a much lower price.

Here are a few more reasons why you should not overprice your home

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A comparative market analysis (CMA) is an evaluation tool used by real estate agent’s, based on local listing and sales data, to determine the probable sale price of a property in the current market.

Who can use this information?

Both sellers and buyers alike.
Home sellers can use a CMA to help determine a list price. Buyers can use it to help them determine the offer price on a property they want to buy.

How accurate is this analysis?

Depending on the quality of the data; the listings used for comparison should ideally be located in the neighborhood, and they should be as similar as possible to the subject property.

Comparative elements:

• Property Type (condo, two storey houses, split level,etc);
• Numbers of rooms;
• Size of the living area and/or building size;
• Year built;
• Garage or parking spaces;
• Basement: finished, semi-finished or unfinished;
• Other similar features such as: fireplaces, inground pool, air conditioning, etc.

To determine the probable sale price of a property, the CMA will use the recent sales from the last 6 months. If the current market is changing rapidly, six months may be too long a time frame, in this case, 3 to 4 month sales records will be used as a reference.

The CMA should also include information about currently available comparable listings, as well as information about properties that did not sell during their listing period. These are called expired listings.

For sellers, active listings would be your competition once your home is on the market. How you price your property relative to the competition is critical to your home-selling success.

Thinking of selling your home?  Contact us for a free home estimate.

Get more home selling tips: Subscribe to the Montreal Real Estate Blog

To Stage or Not to Stage – that is the question!
by Sveta Melchuk

Staging a Home for sale will cost you money. Is it worth spending time and effort on it? After all, once the decision to sell has been made, you just want to get it over with as fast as possible, right?

First, did you determine the «right» price for your house? It should be based on certain objective criteria, such as the location of the property, sale price of comparable homes in your neighbourhood and today’s market conditions. But don’t forget the desirability factor…
While you can’t control some of the other criteria, you definitely have a say in the way your property looks, feels and is perceived by prospective buyers. Increase the visual/emotional value of your property and you will increase its desirability, therefore the price and the urgency to buy it from potential buyers. Why?

It’s the perception of the value that counts. The first impressions make a big difference in the way we perceive a person, an object or a service and, subconsciously, the decision is taken within the first 90 seconds on whether we’ll be «buying» and what value we assign to it.

Even before the prospective buyers set foot in your house, they are probably shopping on the Internet, checking the photos of the properties available in the selected neighbourhood and within their budget. They will make an opinion about your property based on what they see in the pictures and they will decide right there whether it’s worth their time to visit in person. If you have not managed to draw them in at this stage, you might have lost dozens, maybe hundreds of visitors to your house!

Your strategy should be to make the BEST first impression possible, in the Virtual world and for all the prospective buyers who will come to your door. Once they are visiting, make them focus on the property’s best features and show them the value of what they are getting. Choosing a particular house is a largely emotional decision, so make them choose yours. Statistics clearly demonstrate that a clean, spacious and well decorated home sells faster and for more money than other comparable properties.

Staging uses some simple but highly effective techniques to make your house look its best in preparation for sale. So, by spending a few hundred dollars on preparing your house properly, you will be gaining a lot more at the sale time. And staging services cost much less than a price «adjustment» on the house!

So should your house be staged before you sell?

This article was written by Sveta Melchuk from www.Home-Staging-Montreal.com. A Montreal firm specializing in Home Staging and Interior Re-design services.

Home Staging – the MUST HAVE marketing tool for your property

By Sveta Melchuk

MSN Encarta dictionary defines Home Staging as the act of “beautifying a home for sale: cleaning, repairing and updating the decor and furnishings of an older home to make it more attractive when shown to potential buyers.”

The concept dates from 1970s, when a California Realtor and decorator noticed that the properties she took the time to «stage» sold faster and for more money than the average. Today, it’s an important marketing/merchandising tool in the USA (and spreading to Canada from the West) for the Realtors and the home owners alike and it’s especially important in a slow market, where you need every advantage over your competition. TV shows, such as Designed to Sell and Flip that House demonstrate that a bit of effort and a small investment can transform a property and make a BIG difference at sale time!
The logic is strikingly simple: when you decide to sell your used car, wouldn’t you clean, wash and fix it up before reselling it? You should do the same for your house, which is probably your biggest investment and presents an opportunity for a biggest return.

First impressions count for a lot, especially today, when most buyers pre-select the properties they are interested in on Internet. If your photos don’t show your house at its best, you are probably missing out on dozens of potential buyers. The same is true for the visitors – when they come, make them feel «at home», create that first impression which will make them fall for YOUR house.

A professional Staging consultant looks at your property with a buyer’s eye and will recommend some easy and inexpensive solutions to enhance its value – such as decluttering, depersonalizing, and reorganizing your furniture and artwork.
The end result: your house «shows» better than its competition and it sell faster and for more money!

This article was written by Sveta Melchuk from www.Home-Staging-Montreal.com. A Montreal firm that specializes in Home Staging and Interior Re-design services.

If your property is fresh in the market, an open house can be very important. You never know whom in your neighbourhood is looking to buy a home like yours.
There has been some instances where the actual buyer came from a Open House visit. Although this isn’t always the case.

In fact, most visitors who come to open houses rarely buy the house. A lot of them don’t even know the price of your home when they stop by to visit; they probably just followed an “Open House” sign, got curious and came in. It will be the agent’s job to quickly screen the visitors and to identify them as “Potential buyers” or “Lookers”. (Your listing agent should know how to do that)

You might be wondering:
what is the purpose of holding an open house? Read more »»

1. Detach your emotions
   Remember, you are about to sell this house and the goal is to create a space in which as many people as possible will be able to envision as their potential home. To properly prepare your home for sale you will have to pack away many of your personal items, including photos, souvenirs and other mementos.
2. Clean and reorganize
   Clean your home from top to bottom and make sure all appliances are spotless. Reorganize the closets and pack away some of your belongings. Storage room is a priority for buyers and a full closet does a poor job of showcasing the amount of storage room available. If you’re using a spare room for storage, pack away the clutter and ensure the space is properly furnished. .
3. Furnish empty properties and rooms
   People buy homes not houses. Empty rooms make it hard for buyers to get a good sense of the space. Large rooms look cavernous and small rooms look even smaller when empty. Oddly shaped rooms make it especially hard for buyers to visualize how to arrange the room. Staging your empty property with the right furniture is key to ensuring that buyers will be able to visualize living in the space.
4. Brighten and lighten
   Light-filled rooms are always appealing. Open blinds and make sure your windows are sparkling clean. If there are no windows in the room, make sure the lighting is adequate and keep all the lights on when showing the property, even during the day. A fresh coat of neutral coloured paint goes a long way to brighten up the space.
   
5. Spark your buyer’s imagination
   Set the dinner table for a formal dinner, light the fireplace on a cold day, and add some fresh flowers to your décor. Creating the proper atmosphere helps buyers envision themselves living in your home.
   
6. Fix minor repairs
   Buyers prefer to see a home in move-in condition, even small things such as a dripping faucet can detract from the value of your home.
   
7. Don’t be too unique
   Keep your décor simple and modern with neutral wall colours. Unusual accessories and strong wall colours will limit your pool of buyers. This is also true for renovations. The right renovations can often boost the price of a home but be careful not to do it with too much flair. Your unique style may set you apart but it will also shrink your potential pool of buyers. Remember to keep it simple and modern.
   
8. Keep your neighbourhood in mind when renovating
   Actual returns on renovations depend not only on the renovations itself but also on how your home compares to your neighbours’. If your home is already above market value for your neighbourhood, your renovation may not yield a higher return. Buyers looking at moderately priced homes won’t be able to pay a premium for luxury finishes. Ask your Realtor to give you an assessment of homes in your area before embarking on costly renovations.
   
9. Improve security
   Household security is a sought after feature in homes and simple measures such as adding window locks and motion sensor lights outside can boost the attractiveness of your property. In densely populated urban areas, simple additions such as blinds and shutters are good additions to provide privacy.
10. Contact your real estate agent for more home staging ideas! :)

Because of the constant changes in real estate market conditions, more sellers are competing for fewer buyers. And most buyers are not jumping at the first property they fall in love with.
“The initial asking price is NOT that important because it can always be lowered later.”

Wrong! The original asking price is very important. Specially when working with the new generation of buyers who are well informed on the market conditions. But many homeowners still believe over pricing a listing is the way to go. And they couldn’t be further from the truth. It is a myth. It’s a time wasting myth.

Find out more… Read more »»

Recreational Property Values in Canada ‘Set to Soar’
by Jim Adair
Canada’s two largest real estate companies issued reports about recreational properties this week, and while bargains can still be found for those willing to travel and buy seasonal properties, prices are climbing in most parts of the country.

The 2007 Re/Max Recreational Property Report says starting prices for waterfront properties are more than $500,000 in 31 per cent of the recreational property markets, and that only seven markets offer waterfront properties starting at less than $250,000.

Re/Max says aging baby boomers, which represent about one-third of Canada’s population and control 45 per cent of its wealth, are driving the recreational property market. Some are preparing for their retirement years, while others are looking for a second home in which to spend time with family and friends.

“Baby boomers are investing in the future — both from a lifestyle perspective and an economic standpoint,” says Eldon Ash, regional director at Re/Max of Western Canada. “Tremendous equity gains have been realized in recent years as demand for recreational properties across the country swells. Given the aging of the population, this trend is expected to continue for at least the next five to 10 years as baby boomers move through the cycle.”

A Royal LePage report lists some of the hottest cottage areas in Canada, including the Moore Point area in Ontario, where cottages cost up to $3 million; Chester, N.S., which has top-end properties for $1.5 million; and Okanagan Lake in Kelowna, B.C, where small waterfront condos start at $500,000 and year-round waterfront properties range from $1 million to $5 million.

Royal LePage says the big attraction in Kelowna is the recreational lifestyle and the climate. “For example, in April you can ski in the morning, golf in the afternoon and be cruising in your boat at the early evening — all in the same day,” says the report. Read the rest of the story here

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That gentle spring rain is great for your garden, but it’s not so nice when you’re dealing with a leaky roof. If you’ve noticed peeling wallpaper, cracked paint, stains on the ceiling or actual drips that you have to catch in buckets or pots, you need to think about fixing your roof.

A few things you should know about roof repairs

The best-case scenario is that a section of your roof will require patching or repair. The worst-case scenario is an expensive recovering or replacement of your entire roof. When determining which scenario applies to your roof, interview some quality roofing professionals and consider these facts:

- A roof needs to be replaced every 20 to 30 years, on average, depending on materials, installation, weather and maintenance
- Finding the source of a leak can be challenging, even for roofing pros, and repairs can get pricey if you have to keep calling them back for additional fixes

When a new roof is your only option

Your chosen roofing professional has advised you need a new roof. Now, you have a number of new questions to answer: Read more »»

Some homeowners are tempted to try selling their property without the help of a real estate agent (this is called FSBO: For Sale By Owner). The reality is that selling real estate is a complex and highly specialized field.

If you are like most, your home is your biggest asset. An agent will help steer you clear of the many pitfalls, and most importantly, will save you time and money. Here are just a few of the advantages of working with an agent: Read more »»

If you’re thinking of selling your home, you need a marketing plan. Just like any other product people buy or sell, a home’s value must be communicated to the proper audience to ensure the seller gets the best possible price.

Marketing your home means more than putting up a lawn sign and sticking an ad in your local newspaper. You need to have a complete marketing plan that takes into account your home’s unique qualities, your objectives and details the specific resources available to you.

Your planning should begin as soon as you choose a Realtor, and often even before that. Part of your marketing plan will involve pricing your property, deciding when to list it and what features need to be cleaned or repaired. At this stage it is essential that you are completely honest with your Realtor about the condition of your home, your financial needs and any time constraints.

Once you have the basic information established, you need to get to the “guts” of the marketing plan, or determine how best to let people know that your home is for sale and get them excited about it. You need to keep in mind when you are planning that there are two key target audiences: home buyers and other real estate agents. You will need different marketing vehicles to effectively reach each audience. Read more »»

[Prospective Buyers and Your Neighbours DO notice]

The summer months are the perfect time to freshen up the exterior of your home. Whether it’s for your pleasure or to impress potential buyers, you’ll boost your home’s curb appeal with these good old-fashioned cleaning tips:

- Edge the gardens, clean out debris

- Pull the weeds and rake the leaves

- Prune the plants and wooly shrubs

- Plant some urns by the entrance and flowers to the beds

- Tidy the garage of winter trappings

- Dispose of rusty broken garden decor

- Put out a fresh welcome mat and oil the front door

- Paint the windowsills, mailbox, and anything else that is looking tired

- Place clear light bulbs in exterior fixtures, and ensure burned out bulbs are replaced

- Reseal the driveway

- Hide the garbage cans

- Sweep the step

- Fix the saggy gutters

Who says cleaning has to hurt? Get the kids involved! Borrow or buy a power washer and have fun cleaning siding, windows, sills, railings, decking and patio furniture.