Only 48% of Houses in London & Area Sell In 48 Days! Why is That?

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1 Only 48% of Houses in London & Area Sell In 48 Days! Why is That? E n v e l o p e R e a l E s t a t e B r o k e r a g e I n c. 2 5 B a s e L i n e R o a d W L o n d o n O n t a r i o N 6 J 1 V w w w. e n v e l o p e r e a l e s t a t e. c o m By Ty Lacroix Broker of Record & Owner The Way Most House Sellers Go About Selling Their House Leaves Them Wide Open To Some Problems They re Trying To Avoid. When you re getting ready to put your property on the market, there are a number of things to think about, to prepare for, and to organize.

2 The decision to place your home on the market can involve a number of stresses and strains. Many home sales are motivated by circumstances outside your control: Job relocation, family problems, financial issues, divorce, and more. Others are related to family issues: The need for a bigger home, a better neighborhood, schools, etc. But there comes a day when it s time to move on. You have taken the time to reflect on old memories, and prepare to build new ones. You have decided it is time to leave the past behind for a new future. It s no wonder why buying or selling a home is often emotionally charged and potentially overwhelming. Unfortunately, The Way Many Sellers Go About Selling Their Home Leave Them Wide Open To Issues That Affect The Net Results They Want! When you re getting ready to put your property on the market, there are a number of things to think about, to prepare for, and to organize. Below is a list of costly pitfalls to avoid when selling your home: Error #1: Failing to DRESS Your Property for Sale Copyright@ Envelope Real Estate Brokerage Inc. Page 1

3 Buyers look for HOMES, not houses. They buy homes in which they FEEL they would like to live. One of the major factors in getting your home to sell quickly is very simple: MAKE IT FEEL LIKE HOME. Most buyers select their home based on EMOTIONS. Once their decision is made to buy, they justify their purchase with LOGICAL reasons: facts and features. So, it s most important to make your home appeal to all senses. Your property is NOT the only home the buyers will see. You are competing with other homes in the market, and some of them have been professionally decorated. The Way You Live In a Home, And the Way Your SELL A Home Are TWO Very Different Things When showcasing your house for sale, it s going to look very different from the way it looks when you re living there. Here are a few tips for showcasing your home for sale: First impressions set the tone for a buyer visit, and they re LASTING! Approach your house in your car like any buyer would. Examine the outside as you re approaching. How does it look? Are shrubs away from the home? How clean is the foyer? How does the grass and landscaping look? Cluttered looks detract from the architecture of the home. A clean, polished neighbourhood says your area and neighbours care about their home and keep them wellmaintained! Copyright@ Envelope Real Estate Brokerage Inc. Page 2

4 Take a look at your actual house. Is the paint fading or chipping? Is the colour outdated or impersonal? How does the roof look? As you drive up to or away from your home, what do you see first? Now go inside just like a buyer would. You want to be aware of four senses: smell, touch, sight, and hearing. Go through room-by-room and test all four senses. Check flooring and carpet for stains and odors. Most importantly: Pack away all counter appliances, get rid of excess furniture, put away useless dishes, and make your home neat and orderly. If you ve ever visited a model home, you ll notice it s clean and uncluttered. You have to move anyway, so you might as well pack early, and make your home more saleable. Go to the garage and make sure it s neat. Hire someone to professionally clean your home. Top to bottom! Cleaning and cosmetic fix-ups, especially in the kitchen, bathrooms, and master bedroom can many times yield you up to $10 in extra sales price for every $1 you invest. Copyright@ Envelope Real Estate Brokerage Inc. Page 3

5 Pets should be out of sight (and smell!). Get rid of pet odours for showings. Remember the four senses. Also, some people are uneasy around pets, and they may distract attention from the features of your home. Pay particular attention to lighting. During the day, open all your blinds and curtains. If it s cloudy out, turn on all lights for showings. At dusk, leave your front drapes open and turn on all the lamps and lights. At night, do the same, but close your blinds and curtains. When showing your home, turn off all appliances, television, radio, and anything that will distract attention from your home. You might want to play a little light music to enhance the emotional experience for your buyer. Error #2: Pricing Your Home Incorrectly Every seller wants to realize as much money as possible when selling his or her home. The natural inclination is to price the home high, thinking you can always come down in the future. But a listing price that is too high frequently nets the seller LESS money than an original price at market value. Why is this? Because, when most people looking for homes in your price range, they will reject your home in favour of other homes in a reasonable price range. Buyers know prices, they may have already been in 6-10 homes, they can compare and in the long run, the buyer will decide if your home is priced right! No offers on your house after 30 days, what do you think the reason was? And here s the real clincher: Sales Representatives who would readily bring buyers through your home will automatically cross it off their showing schedule because it s priced too high. They re only motivated to show homes with the highest probability of selling. A lot of weak agents simply will not show overpriced homes because they work by commission and do not have the confidence to make a less than asking price offer! Copyright@ Envelope Real Estate Brokerage Inc. Page 4

6 So you price your home high, thinking you can come down. Problem is, the agent and buyer community don t look at it that way. They see it as an overpriced house. After a few months go by, a few open houses, signs, agent tours and not a nibble. So you decide to lower your price again. But it s too late your home has already been branded by the agent community. So you reduce your home a little more. And little happens. Finally, in order to attract attention back to your home, you ve reduced your home price more than you ever thought you would, and you re now netting much less than if you had priced it correctly in the beginning. And think about this: The money you lost is not just the lower sales price, but all the extra interest you paid on your mortgage all the extra property taxes and other carrying costs that accrue while your home is waiting to sell. I ve seen it happen time and again! I call it chasing the market or to be subtle, like falling off a cliff in the night, you know you are going to hit the bottom but you don t know when! Real Estate Fact: The Seller Is Solely Responsible For How Much, and How Quickly Their Home Sells! Copyright@ Envelope Real Estate Brokerage Inc. Page 5

7 Overpricing almost always increases time to sell, and adds to your carrying costs. Here is another chart that shows what happens when you are overpriced: The most common mistakes sellers (and REALTORS) make when choosing a price. Copyright@ Envelope Real Estate Brokerage Inc. Page 6

8 Not choosing the right price when a property is first listed. In other words, thinking We can always come down. Putting the property on the market at an unrealistic price. A property must be priced on a comparative basis to the other properties which are similar. (I should add, everyone thinks their home is different but buyers and their agent doesn t think so.) Not relating marketing time to price. Generally, the quicker you want to sell, the less you should be willing to take. Calculating brokerage fees on top of the sales price. A home is worth what it is worth, with or without a commission. Thinking that buyers aren t comparing your home, on a dollar-for-dollar basis, with every other home on the market Some of the topics I discuss with my clients cover the following: How to set the asking price to maximize exposure and a profitable sale. How do you really define and compare market value between homes? How the total market performance may affect your home sale positive or negative. How to protect yourself from crime when selling your home. How to handle buyers during any showing to help yield the highest price. Once you understand these important issues, you ll know how to price and sell your home for the fastest, most profitable sale. Also, with this information, you ll never pay too much for any home you buy for the rest of your life. Error #3: Limiting the Marketing Exposure of Your Property The most obvious marketing tools everyone uses (Open Houses and classified ads) are only moderately effective. Successfully marketing of your home (getting the highest price, at the right time, and with no hassles and problems) requires much more. Not surprisingly, less than 1% of homes are sold at an open house! Agents use open houses to attract buying prospects, not to sell your home. And advertising studies show that less than 3 % of people purchased their home because they saw it in an ad. You know what I am talking about. Every real estate magazine page looks the same. The real estate person s picture is larger than the Copyright@ Envelope Real Estate Brokerage Inc. Page 7

9 houses they are trying to sell. And, they try to tell you that they are honest, have integrity, and are number 1 in something, have won this award and have an alphabet after the name for designations. I m all for learning but I have never seen a map yet take action to get me some place! Do you think a buyer cares? They are tuned into WIIFM (what s in it for me). They want information, they want to feel good about buying your home and they want to feel they got a fair price. That s why the most competent agent will have a broad spectrum of marketing activities, emphasizing the specific strategies that will work best for YOUR particular property or area ONE MORE THING Did you know that most home inquiry calls come in during business hours when agents are away from their offices? I have experienced some who respond 2 or 3 hours later or even 2 days! Error #4: Thinking Your Appraisal Is the Market Value of Your Home An appraisal is an opinion of value for an entirely different purpose than selling your home. Usually an appraisal is to provide bank or mortgage institution information to fund a loan. If a lender is motivated to loan you money, his appraisal may come in higher than the true market value of your property. When a buyer looks at a home, they look at all the factors: foreclosures, distressed sales, bankruptcies, divorces, and area fluctuations. Don t make the mistake of thinking the appraisal value of your home is what a diligent buyer would pay. Copyright@ Envelope Real Estate Brokerage Inc. Page 8

10 Error #5: Not Understanding Your Rights and Obligations Real estate law and regulations can be very complex. When you sign an offer for the sale of your property, it s a legally binding document. An improperly written offer can create many problems for you: a sale could fall through, cost you thousands in forced repairs, inspections, and remedies for items included or excluded in the purchase offer. You must understand what repairs and closing costs you are responsible for in a contract. Have you disclosed everything? The courts do not accept Oh, I forgot to mention that as a defense. You also need competent review of your title, and whether or not your property is in conflict with local restrictions or laws. (I just recently helped a buyer purchase a home and there were 3 outstanding work orders from the city that were 4 years old. And get this, the seller did not even know they existed. So, 2 real estate people and 2 lawyers did not do due diligence. All I did was check city hall, it is just one of the to do s on my check list!) If you have to remedy these items yourself, you can spend thousands on legal bills, fines, contractors, and other costs. In the above case, it was $ ! Using a competent Realtor up front can help identify and avoid these issues before they become problems. Error #6: Signing A Listing Agreement With NO WAY OUT! Just about every agent has good intentions about helping you sell your home. But situations and circumstances change. The agent might have personal problems, or simply decide to retire or get out of the real estate business. Copyright@ Envelope Real Estate Brokerage Inc. Page 9

11 Or other situations may arise where the agent isn t doing his or her job as you expected. The home may not be getting the exposure you desire. Or perhaps you haven t heard from your agent in six weeks! What do you do now? When this happens, you should have the right to fire your agent. But the listing agreement you signed is with the Brokerage, not the agent. If you re unhappy, the broker may assign your home to another agent someone you neither personally selected, nor do you want. But you re stuck with him or her until the listing agreement expires. And that can cost you a lot of money! NOTE: We have a Cancellation Agreement with all our listings which is extra motivation for us to sell homes. (Since 2004, we have had 3! One because of a death, one a job loss and the 3 rd, the seller (the male) disliked us!) Always protect yourself by: 1) carefully selecting the right agent, and 2) make certain that in a worst case situation, you have the flexibility to modify or cancel your listing agreement. Error #7: Selecting the WRONG Agent Do you remember the old riddle that goes, What do you call the person who graduated dead-last in their medical school class? Answer: DOCTOR! Well, it s the same with real estate professionals. Someone with vast experience and extraordinary professionalism usually costs the same as someone with little or no experience, or with compromising standards. You need to know how to tell the difference up front. Copyright@ Envelope Real Estate Brokerage Inc. Page 10

12 Bringing competence and experience into your transaction may mean the difference between a higher negotiated sales price and losing money, selling in less time or in more time (costing you potentially thousands in added interest), and experiencing problems and hassles or a problem-free transaction. Some do not do much business so they will tell you anything to get a listing or a sale. Overpriced listings happen and then 30 days after they ask you to price the home where it should have been in the first place. Experience is like fashion, it changes and what worked ten years ago, five years ago or last year may not work today to attract buyers to your home! In Summary Focus In On the Major Key Issues, Be Realistic, And... Most Importantly! Choose the Right Person to Help You The most important thing you can do right now is begin educating yourself about the process of selling your home. If you re considering listing your home with a REALTOR make absolutely sure he or she has the skill set it takes to market your home effectively. You see, marketing a home takes more than just sticking a sign in your yard and putting your property up on the MLS (Multiple Listing Service) and praying and wishing it will sell, anyone can do that! It takes aggressive, innovative marketing to sell your home in today s market place! What do I mean? Well... in today s market place there are only so many buyers out there who are ready and able to purchase a home. So, if you want to sell your home, your REALTOR has to aggressively identify these potential buyers before other REALTORS get their hands on them and guide them into a different property. The fact is, when you enter the market to sell your home, you enter one of the most competitive businesses in existence... anywhere! Competition is fierce Copyright@ Envelope Real Estate Brokerage Inc. Page 11

13 and if you re not ready for it... your home just sits on the market. So, the first major key to effectively marketing your home is to identify potential buyers. Remember, there are only so many buyers to go around... and your REALTOR has to find those buyers first - before one of the hundreds of other REALTORS out there reaches them and guides them into a different property! So, how does a REALTOR identify these hot buyers before the competition? This is where the rubber meets the road! This is what separates the weak REALTOR from the alert, business-minded marketing professional you want to hire. Your REALTOR Absolutely Must Have An Aggressive Marketing Strategy! The best REALTORS use every available marketing tool, technology, approach, contact or potential avenue to generate prospective buyers for your property! One key element is they understand the value of effective marketing! They realize that in today s competitive market they can t just splash their name out there and expect people to call... they have to craft their message... and give buyers a compelling reason to call. So, how does the REALTOR you re considering separate him or herself from competitors? If you pick up any real estate magazine or flyer, all content look virtually the same. There is 2-6 homes in a little box and a huge picture of him or her and #1 this, #1 that, or a member of you name it club. Or, (I can see your eyes rolling now!), they say stuff like, honesty, integrity, we care etc. Well, they better care, they better be honest and they better have all of that and more, it s your home and your money! Copyright@ Envelope Real Estate Brokerage Inc. Page 12

14 So, what s unique about your REALTOR that s going to grab buyers and get them to pick up the phone and call? In today s market place, it s tough! Potential buyers have been harassed, high-pressured and pushed around so much... it s no wonder it s hard to get them to call! I m tired of pushy salespeople too... I can relate! They use razor-sharp strategy & cutting-edge technology as THE ADVANTAGE! The best REALTORS overcome this huge obstacle with a razor-sharp marketing strategy, (not the usual 3 bdrm, 2 bath, beautiful home, nice floors, clean, good neighbourhood and close to schools. Put s you to sleep doesn t it? Your home has a story, it is your past and the marketing of your home must reflect the feel and energy of your home, not necessarily the quantity of rooms. Most people who can afford to buy a home can count!), combined with cutting-edge technology, to generate buyer after buyer! Now, everyone says they have technology but then they lack the personal touch or hide behind their keyboard. Or, what really gets me is that it is like pulling hen s teeth for a return phone call ( in a reasonable time frame) Wow, they have a home listed and they don t return calls? It s bad enough not calling a real estate person back for information, but, not calling a potential buyer back? Think I m kidding? In a recent Canadian Real Estate Association poll, the biggest frustration potential home buyers had been the tardiness or never even getting a return call. Remember, the major key to generating a buyer for your home is to reach your buyer first. And to reach buyers first, the best REALTORS are using an up to date automatic response notifier, virtual tour system, great marketing copy personalized for your home, neighbourhood reports and calls to action. Copyright@ Envelope Real Estate Brokerage Inc. Page 13

15 So again remember, the first one to reach your buyer wins the sale. So, if you want to get your home sold... don t settle for anything less! The first two questions then are: 1. how are they going to make the phone ring with lots of new buyers for your home? And 2. What s going to give them the edge and get them to the starting line first? Then comes the next question. How sharp are your REALTOR s negotiating skills? What kind of results have they produced for past clients? This is so crucial! Most people think that selling a home is like being a tour guide. Show the buyer around, ask if they like it and write up the paperwork. Well, if that s all there was to it, any REALTOR could sell your home! Your REALTOR Absolutely Must Have Strong Fundamental Negotiating Skills! If you want to get your home sold, your REALTOR absolutely must have a deep understanding of The Art of Negotiating. These skills are vitally important! Without these skills, you could lose big! With these skills, your REALTOR will ensure you get the highest possible price for your home. So, how do you find out about your prospective Realtor s negotiating skills? Meet with them! Do they have testimonials from past clients? Suggested Questions for Real Estate Agents When You Interview Them Do you work as a full-time Realtor? How Many potential buyers and sellers do you talk with in a week? A month? Of those you speak with, how many actually contact you as opposed to cold calling? How many buyers are you currently working with? In what ways will you encourage other Realtors to show and sell my home? What can you tell me about the real estate market in this area? What price do you recommend for my home, and what is it based on? What are your average days on market? What is your list to sales price ratio? What kind of marketing do you do? May I see some samples? How often will my home be marketed and updated, and where? Copyright@ Envelope Real Estate Brokerage Inc. Page 14

16 Will there be a virtual tour? How do you attract buyers from outside the local area? Will you prepare an informative feature sheet for my property? May I see a sample? Where and how will the feature sheets be distributed, and to whom? Do you have a system to follow-up with other agents and brokers so that we get valuable feedback after every showing? Can you show me a sample? How often, and in what way will I be kept informed? Are you associated with a national referral network that refers their buyers to you and gives you the opportunity to refer me to the top agent in the town or state I may be moving to? Do you have a Team to help with the details, or are you a one man / woman wonder show & do it all yourself? Do you have a Specific Marketing Plan designed to sell my property quickly and for top dollar? How does it go beyond placing a sign in my yard and notifying the Multiple Listing Service? May I see a copy of your last listing as it appears to other Realtors on the MLS? (Called a Realtors Full Report ) Do you have a Hot-Line so that my home is marketed 24-hours a day, 7 days a week? How many homes have you sold in the past 6 months? Year? Do you have references that I may call? What happens if I am not happy with your service? Do you have a 100% satisfaction guarantee policy? Can I cancel my listing if I am not satisfied or am I locked in? FACT In today s market, buyers are increasingly savvy. Many sellers are testing the market resulting in a high number of listings. This means the competition is stiff! Working together, we can make sure your home gets the attention it needs to stand out from the pack. On the average Buyers inspect 17 homes before making an offer. That means 16 other homes are competing against yours. What that means to you is Your home will sell at highest profit and in the quickest amount of time when all the ingredients are combined perfectly. If only one ingredient is left out of the formula or is out of proportion to the others Copyright@ Envelope Real Estate Brokerage Inc. Page 15

17 Your home will take longer to sell and will, quite possibly COST YOU MONEY So, in conclusion, really think these things through! This is such an important decision. Get prepared! Really fire away with questions when interviewing a REALTOR. Make them stand the test of fire... the best REALTORS thrive on it! They can t wait to tell you all about the innovative methods that separate them from the REALTORS that ll poke a sign in the ground and act like that s enough! In today s market, it s most definitely not enough! That s why I offer a compete 100% Guarantee of my services. I place my priorities with yours to get your home sold! If at any time you re unhappy with my work ethic, let me know. If I cannot rectify the situation, you can FIRE ME. No questions asked. Ask any other Realtor to match MY guarantee. You ll find most get very uncomfortable when you put their feet to the floor to perform. One of the reasons I go the extra mile is that it is less crowded there! Our EASY EXIT LISTING AGREEMENT In a recent Canadian Real Estate Association s (CREA) survey, the biggest fear home owners have with a real estate agent is being locked into a lengthy listing agreement costing their home valuable time and exposure on the market. We take the risk and the fear out of listing your home with a real estate brokerage. How? Through our EASY EXIT Listing Agreement. When you list your home through our EASY EXIT Listing Agreement, you can cancel your listing with us at any time. No hassles. Copyright@ Envelope Real Estate Brokerage Inc. Page 16

18 It s easy. You can relax, knowing you won t be locked into a lengthy contract. Enjoy the caliber of service confident enough to make this offer. Only one restriction applies we ask that you voice your concern and give us seven (7) days to try and fix the problem. That seems fair, doesn t it? If we can t fix any concerns within the seven day period, you are free to withdraw your listing. No hidden fees or a cancellation fee! You Have My Risk- Free, Cancel- Any- Time Agency Guarantee If at ANY time you feel I m not living up to my end of this agreement (for ANY reason) you can end our relationship, walk away and you re under no legal obligation what so ever! We will prepare a Mutual Release which means your home will not be represented by us in any way and you are free to employ any real estate company you choose. Fair enough? So the ball is totally in my court to perform. If I do- we accomplish our goals together. If I don t deliver- you can walk away. I have a very strong conviction about real estate service. I believe that if you are unhappy with the service you receive, you should have the power to fire your service provider without penalties! Copyright@ Envelope Real Estate Brokerage Inc. Page 17

19 Hi I hope you found the Selling Your Home in 30 Days to be helpful and that you found a few ideas or a few thoughts to get your home sold. If you like what you have read and you would like to receive other insider tips and ideas on buying or selling a home, let me know at ty@enveloperealestate.com. Or We have 3 series of e-zines, some sent once every 9 days for those who want to move in 1-3 months, another series every 18 days for those who want to move within 6 months and for those who are unsure, we have a series that goes out once a month. I should point out that: You are under no obligation You can cancel anytime We will not solicit, bug, call, impose or bother you in anyway, you hear from us ONLY if you request we do so! WHY? Not all Realtors are the same and we prefer to attract and not chase clients. I do not like being pushed or pressured into anything and if you are like most people, you don t either. I feel that if you like what we write about, learn about our experience in the field, like how we do things, you may consider hiring us. If you don t hire us, then that tells me I need to do a better job of expressing our value and skills to others and improve the message! That is great motivation to me and thank you again for reading this guide. Ty Lacroix owner and Broker of Record Copyright@ Envelope Real Estate Brokerage Inc. Page 18