Ellen Roseman Blog According to her blog, "Ellen is a personal finance and consumer affairs columnist with the Toronto Star’s business section. Her columns appear Wednesday, Saturday and Sunday."
She is to the local newspaper scene, what Erin Davis it to the media scene... that is, a "must read".
Erin Davis's Official Homepage Erin always has a finger on the pulse of this vibrant city. Her blog is informative and fun. If you want to know what's happening or what's happened, don't bother listening to the news reports, go to this blog. My guess is this is one of the most popular sites in Toronto.
Some lawyer wrote an article for the Toronto Star suggesting that Realtors will avoid disclosing certain information to their clients. This is my blog and he doesn't deserve to be mentioned by name here. The article is entitled "5 things a real estate agent won't tell you".
If he's suggesting some of us hold back information to benefit ourselves, he's right. I know of two who would do that. Pot calling the kettle black if you ask me.
Here are the real facts.
1. Commissions are negotiable. I never knew this to be a secret. Are lawyer fees negotiable? Do they reveal that to all of their clients?
2. Agreements are for 6 months. In order to be submitted to the MLS, the Listing Agreement has to be a minimum of 2 months. The maximum is unlimited but I've never seen one more than 6 months in all my 25+ years as a Realtor. Why any agent or customer would want a one year agreement is beyond me. Do lawyers all work contractually? Or is their service open ended, as long as it takes?
3. Open Houses benefit everyone. There was a time 15+ years ago when open houses were not considered to be a valuable marketing tool. It was a way for Realtors to meet new prospects. This has all changed. Houses and condos that do not host open houses today are denied potential qualified buyers who "only" view houses during an open house. Has this guy ever sold a house? How does he know so much about the value of open houses?
4. Not all real estate is a good investment. The lawyer is correct. I never knew an agent, ethical or otherwise who said otherwise. Where is this guy getting his information?
5. What does a lawyer know about staging? Staging a home will not only get a higher selling price, it will hasten the sale thus saving the seller carrying costs such as mortgage interest, taxes, utilities and the like. Is staging now being taught in law school?
Canada offers a lot of pretty wonderful benefits. We all know what they are. Some of us even salute these benefits every day of our life. There is one silent gem however that exists below our societal radar screen and this should never be taken for granted.
I've seen many hundreds of people sign contracts. Not one has ever put pen to paper lightly. It's a momentous occasion. It's a very big deal. It's as final as saying "I do". This is a very good thing and adds greatly to our quality of life.
I know from my time as a Realtor that some cultures are a bit more laissez-faire about this. But in Canada, we are accountable and the consequences of failing to meet our obligations are usually severe.
Toronto Star columnist and real estate lawyerBob Aaron wrote about a small claims case recently. Simply put, buyer and seller had a binding contract on a house. Before closing, the buyer learns the taxes on the property were almost double the amount published on the listing. An addition to the property triggered a reassessment, hence the increased taxes.
Two days before the agreed closing date, the buyer tries to squeeze the seller by refusing to close unless the agreed price is reduced by $10,000.00. Seller says "no" and the deal does not close. Sadly, the parties were not able to work out a reasonable solution and this dispute went to court.
Bob quoted the judge's ruling. "The vendors knew or ought to have known that they were obliged to compensate the purchasers for the misrepresentation on the taxes if the purchasers were forced to close. (The $10,000 reduction offer) certainly appears to be a reasonable attempt to estimate (the purchasers) potential loss. (The sellers were) negligent in absolutely refusing the $10,000 abatement".
This highlights an important part of any negotiation. As a Realtor, one of my job responsibilities is to qualify the parties signing the contract. The integrity of a deal is valued in direct proportion to the desires of both parties to enter into said contract. If a buyer is offering on a property, the more he/she wants it, the more likely it will close successfully without problems. Ditto for the sellers. Cold feet can trigger problems with closing. When this happens, no one wins (except the lawyers perhaps).
There's been a kerfuffle in the local real estate industry lately over a listing in the Beach area. Apparently, the Realtor is charging perspective buyers a $50.00 fee to view the house. Proceeds are going to charity but still.... $50.00? To see a house for sale?
As it turns out, I think it's a reasonable and brilliant idea. I know with with a fair degree of certainty that there will be mostly tire kickers viewing this palace, I mean house. Few can afford the $6,750,000.00 price tag but many will want to see it just for fun, in particular, the professionals. I'm referring to the "house viewers who have no intention of buying".
In a parallel universe, there is a legendary music store in Nashville called Gruhn's Guitars. It's situated on the busiest tourist strip in the city. After being in this location since 1970, they're moving. Why? Because they're sick of being a tourist destination. Often the store is filled with inebriated tourists who are waiting for a table at the Jimmy Buffet bar across the street and as they recently told me, they're "fed up".
I suppose they could have tried the $50.00 cover charge but most of their customers, the guitarists and banjoists of the world, don't even make that much on any given night. Moving to a new location was a much better solution.
"The now-renamed Residential Tenancies Act sets out tenant protections for all rental units across Ontario, but rent control provisions only apply to buildings occupied before Nov. 1, 1991."
I was in a rather nice restaurant having lunch with a client recently. It was filled with business types, young people climbing the proverbial ladder. I was surveying the scene and happened upon a gentleman across the room heartily completing his lunch when he unselfconsciously picked up his plate and licked it. It happened so fast it didn't register for a few seconds.
My first thought was, I'm pretty sure the Downton Abbey folks wouldn't be caught doing that. My second thought was Bill and Muriel, my dear late mom and dad would also not have approved. By some standards, Bill and Muriel were manners police, at least that's what I thought when they berated me for placing elbows on the table, holding my fork like a shovel and chewing with my mouth open. I also couldn't sing at the table but I'm not sure why that was so bad. However, compared to what I see around me, I now think my folks did a great job teaching their five kids how to generally behave like civilized members of society.
I thought of this when I read in the weekend paper that Massachusetts Institute of Technology (MIT) was teaching their students how to behave at a table, the assumption being, if you want to succeed in business, it's a good idea to know when to dunk your doughnut in your coffee and when not to.
I asked a close friend, who many consider to be Chief of the Manners Police Department, if she would list the most common behaviours that offend her sensibilities. She was very happy to send me the following:
1. chewing with mouth open
2. talking with food in mouth
3. serving/passing to self before others
4. starting to eat before everyone seated & served
5. clearing dishes of 1/some before everyone finished eating
6. lowering mouth to food rather than raising food to mouth
7. elbows on table while eating
8. making noise while eating, eg slurping liquids
9. sucking spagetti into mouth & biting it off rather than using spoon to twirl it into manageable bites
10. holding utensils like a sword, impaling the food & then placing said utensil on the table cloth/placemat rather than on the plate plate after use
The MIT course was voluntary and judging by the eating behavior of many I watched in the restaurant that day, they might want to consider making this course mandatory in all curriculua. Just saying!
The consumer in Toronto who happens to be in the market for a house right now must be exasperated by what's going on. There is no logic to the asking prices and the sale prices.
An occurrence that's happening much too frequently is that houses are being listed at prices well below market value. Therefore, many eager home buyers who can only afford this list price are paying for home inspections, taking time off work and in general disrupting their lives with the feint hope they have a chance at this house. The fact is, in these circumstances, the Vendor will never accept the asking price, ever! These buyers (and their agents) are simply wasting their time preparing to offer on the house. In my view, it's simply lazy agents who don't know how to properly price a house.
My approach has always been to never list a property below what a Seller would accept, that being fair market value. This strategy is ethical yet still guarantees a high sale price if the demand is there. This approach never compromises the interests of the seller. Nor does it mislead a buyer into believing they actually have a chance to get the house at a ridiculously low asking price. The difficulty for some Realtors is having the knowledge and experience to identify what that correct asking price is.
Because of this strategy, there is no pattern to the market. For example, a listing on a poor street, priced low might sell for 20% more than the asking price. Another listing on an average street might receive 3 offers and sell for 5% over asking. How is someone supposed to make sense of this?
After having been through this many times over the past few years, I can see clearly into the future and can absolutely guarantee that it will not last much longer.
If I was an active buyer in today's market, I'd chill for a few days. Then I'd call me or Karen and ask that we call them when they should resume their search. Delayed gratification will save them many thousands of dollars.
One of the many advantages of working with a licensed Realtor on a real estate transaction has to do with discovering the facts about a property. If I have an agency relationship with a client, one of my primary responsibilities is to investigate and reveal any and all information I can find about a property. In law, there are some issues that do not have to be disclosed by a Seller. For example, if there was a nasty murder in a home, there is nothing that says the seller has to disclose this to any interested buyer. The same rule does not apply to Realtors. We are compelled by our Code of Ethics to reveal any and all defects that might influence someone's decision to buy or how much they might pay.
On a more practical front, it would be a bigger hazard to a deal if a defect was not disclosed but was discovered by the buyer at a later date. This has the potential to be much more damaging, inspiring lawsuits or simply refusing to close on the sale.
Best policy is to always disclose, disclose, disclose.
We see this in other professions time and time again. A politician gets caught influencing a vote or in a conflict of influence and their first reaction is to deny, or worse, deflect the blame to some innocent taxpayer. Then, when the proof becomes known, only then do they own up to what they did. It would have been much less damaging to acknowledge the truth at the outset.
I could have written that heading 25 years ago... or even earlier. The real estate industry was discussing it then. Computers were the rage and everything relating to a transaction was going to be online. No more 8 1/2 x 11 paper to contend with.
I don't mean to be an old poop or anything but this will not happen anytime soon. Yes, there will be supposedly forward looking people who flog this idea and pull out their little iPad whenever they can. My experience is that the tactile freaks will prevail.
The paper work associated with a real estate transaction is our teddy bear. We don't actually hug it or sleep with it but we do need it there if we need to touch it, even if we never pull it from the file.
Someone should do a survey to assess how much paper we use in 2013 as compared to 1987.
Most Agreements of Purchase and Sale these days contain a special clause that allows Realtors to use the specifics of the sale to be used for their personal marketing. It reads something like this:
"The Seller and Buyer of this property hereby agree to permit the listing broker and/or the Selling Brokerage and their respective representatives to use any and all information related to the property in any and all marketing materials and formats for the sole and express purpose of promoting the property and/or Brokerage and/or Sales Representatives."
On the surface, it looks innocent enough and seldom is it discussed at length. At the time the client reads this and signs off on it, they're excited and focused more on the purchase/sale price and the closing date so they don't really think of the repercussions.
For the most part, this doesn't appear in the client's radar screen again and it's forgotten.
However, there is the odd occasion when the details they've permitted with this clause become intrusive and even embarrassing.
It used to be flyers that are delivered in a neighbourhood that contained details about the sale and since most everyone knew about the sale in the first place, there was never a surprise. Today however, the newspapers have features such as "What They Got" and there one finds the address of the sale, some of the details of the sale and how much over asking a particular buyer paid. Not only that, there are interior photos of the property published online during the sale and they generally remain on the internet for all to see long after the new buyers have moved in.
I ask you, how would you like the general public to know the details of your purchase of the house and be able to view the interior any time they want?
I meet quite often over a coffee with a pal of mine, Gary Beechey. He's a professional photographer and has been at the top of his game, photographing the rich and famous for a very long time. Like the rest of us boomers, he is feeling the heat from the youngsters coming up behind him, chompin' at the bit, vying for his contacts.
We talked the other day about the need to be current, or at least the need to be perceived to be current. He told me he just bought a very expensive camera and lens. He didn't really need it to do his job but the new gadgets in his arsenal help with the image he's selling. I told him I too invest heavily in my business. I don't have cameras to buy but my on-line presence and my marketing budget is very high. That's the way he and I have been able to stay on top of our game and keep the young wolves from the door. It's called staying current. We're both experienced and knowledgeable in our fields but that isn't enough. It's never been enough nor will it ever be.
As we age in a youngish economy, we're acutely aware of the competition we're up against. This doesn't mean we have to out-twitter or spend more time on Facebook than our young competitors. But we can't let up. That's no different than in years past. We've been looking over our shoulders since we started.
Maybe that's whats kept us both at the top of our game all these years
I'm a big fan of Anthony Wolf, the child psychologist who writes a parenting column in The Globe and Mail. I'm long past the parenting era of my life but I can still use the life lessons I learned from those years. I like to think that I would have been a better parent if Wolf's column had been available. Yes, I'd like to think that. However, I'm not that dumb. I doubt it would have helped. I had to stumble through those parenting years and learn those important lessons my own way. That's just the nature of the beast.
Perhaps the most important lesson I could have learned from Mr. Wolf was someething he preaches in almost every column. Detatchment! By that he is saying, "don't own someone else's journey". Feel sympathy. Feel empathy. Feel compassion. But there's nothing to be gained by suffering as they suffer.
Easier said than done.
Being one of five kids in a small rural community in Northern Ontario in the 1950's, I'm certain my mom didn't know what I was up to most of the time. I banged up lots of knees, fell out of few trees and engaged in a few scraps with other kids. She might hear about it when I got home but unless I was hospitalized, I doubt she gave it a second thought. Nor did I want her to. These were my pains, my problems and I wasn't inclined to share them with her. We were both better for it. Nothing would have been gained had I offered her the opportunity to fuss.
Let's apply this same approach to business or medicine or plumbing. A negotitor who can maintain some distance from the outcome will be more objective and clear headed when applying their analytical skills to the problem at hand. I don't want my surgeon to think too much about what I'm personally going through as he's cutting me open to fix a problem. I simply want him to stick to the task at hand and do the best job he can do. I don't interpret this to mean he doesn't care. And the plumber? Please don't worry about the flood and the clean up. Just stop the damn leak.
When I'm in a public place and a little kid is acting up, screaming and flailing about because he can't have his own way, I think of this as the parent's stress level climbs higher and higher. I just want to go over and gently say, "Relax. It's his/her problem. They'll get over it."
The house is located at 58 Armstrong Avenue in the Dovercourt-Wallace Emerson-Junction area. Listed at the ridiculously low price of $419,900.00, it was clear that the sale was set up to receive multiple bids. And that it did. There were 40 offers (originally 47 but 7 withdrew at the last minute). The winning bid was $601,500.00.
Pricing that is blatantly under market value continues to reflect badly on Realtors and this is one of the worst examples I've ever seen. Given there were over 350 showings (including me and my client), I can't help but wonder how many man hours were wasted over this. My guess is most of the showings were to clients who could perhaps afford the asking price but had no chance of buying it at the final sale price.
Yet, there is the photo in the paper of the smug Realtor who probably thinks he's a big hero for negotiating (?) such a great price for his clients.
It was a 2 and 1/2 story detached home with parking on a pretty good street. It isn't yet an "A" neighbourhood but it's slowly inching up there. If the buyer needs a mortgage, I hope he/she has a sizeable down payment. The bank might not think it's worth $601,500.00 after they appraise it. To describe it as a complete dump would be giving it too much credit. This house needs hundreds of thousands of dollars to make it habitable and then what would it be worth?
When you return from vacation, chances are your mail box will be filled with flyers offering you a free home evaluation by a gaggle of Realtors hoping for a chance to sell their sign on your front lawn. For many years now, the real estate industry has been using this strategy to entice the consumer to reach for his/her phone and dial their number.
This marketing strategy is only designed to trigger an introduction. When the consumer initializes the call, we consider that to be profoundly significant. It means that the owner has willingly notified us that they are considering putting their house on the market. Many agents spend many many thousands of dollars each year to produce and deliver these flyers. That's essentially how they get clients. It's sort of like "buying" the business.
So when they advertise the evaluation as being free, it isn't really.
Besides the cost of designing, producing and delivering the card, there's the organization in place to receive and process the call. There are a lot of man hours required to prepare a detailed and accurate evaluation and then there is the visit to the house and the follow up and as you can see, the hours involved are many.
I haven't even tried to put a price tag on the expertise and training that goes in to determining what constitutes a good market evaluation. Don't get me started!
Since late last night when I heard that Stompin' Tom had died, I've been drafting this blog entry in my head. I'm having a tough time with this. I figured he'd live forever. He was simply one of those bigger than life characters that made his way into my psyche and will remain there until I too die and join him in the big.....no, that line won't work with Stompin' Tom. He was not a delusional man and if he feared death, he sure kept it to himself.
I've watched him smoke thousands of cigarettes and consume cases of beer (and pretty much anything else that was laying around) and remain awake night after night with little sustenance (except perhaps a bowl of soup for breakfast) and after all this, walk onto a stage at 9:00 pm and perform two long shows for his avid fans. After putting his body through all that, I figured there's no way this man would die. Now that I think of his legacy this morning, I realize that I was right. He will never die.
During one of our all night chess games, I asked him about his views on life after death. With his Black Cat cigarette hanging on the end of a cigarette holder dangling from his mouth, he simply said "no". It was hard to get him worked up when he was planning the big check mate move, and believe me, he was always planning a check mate move. With every move, he was going in for the kill.
Our drummer one time made the mistake of beating Tom at their first chess game and he was immediately sentenced to an all night chess session in a cheap smoke filled hotel room in some small town in New Brunswick. Tom taught me a few things about being competitive.
Thanks Tom!
Rather than tell more Stompin' Tom stories, and I have a book full, I instead salute the life lessons I learned from this man. I thanked him often for the great times but if I may, one more time say, Thanks Tom!
If Tom had a motto, it was "tell it like it is" and enjoy the consequences. I say enjoy because he would never suffer consequences. He embraced them. His career took a hit when he returned his Junos in 1978 but to him, that was never an issue. I think this was why our friendship endured and that is a result of one encounter he and I enjoyed somewhere on the Trans Canada Highway.
He came close to firing me and punching me at a gas station between Quebec City and Sackville New Brunswich back in 1993. We had been on tour for some weeks and I had simply had my fill of his rules, and believe me, if you were on tour with Tom, he had rules! I was even more adverse to sitting in a smoky hotel room listening to him discuss my naughty behaviour. So, one night, I up and walked out of his room before he got started and this almost drove him over the top. I'm not proud of this but I fueled the fire the next morning. When we hit the road, I announced on the CB that I didn't want to drive at 120 kmh (as we had been) for fear of getting a ticket. My saving grace was, I didn't back down. In fact, that 24 hour period solidified our friendship and freed us to chuckle about this often over the years.
This was a pivital moment for me and set the tone for the rest of my life. Tom taught me that I don't have to make excuses to anyone for simply being true to myself.
Thanks Tom!
He loved my banjo playing, inviting me to record and tour with him many times over the years. Many years ago, he recorded a song called the Blue Berets. He loved my banjo break so much, he doubled it during the mix for this video. He would listen to it over and over as we were sitting around talking. I never saw myself as much of a banjo player but that changed after Tom's vote of confidence.
Thanks Tom!
If you want to see some photos of Tom's personal bar in his home near Ballinafad Ontario, check out the photo galleries here. Whiskey Jack performed often at chez Tom and each time, it was like playing at Massey Hall.
Thanks Tom!
Oh, one more thing Tom. Thanks for taking me to the Stanley Cup on Parliament Hill on Canada Day in 1993. It was the thrill of a lifetime.
Teaching is one profession that continues to give long after we leave school. At least this is what I've noticed.
I spent many hours in classrooms with my kids over the years. I learned very early on that the idea that this is a cushy job is blatantly ridiculous. From what I've seen, this is a most demanding profession and the thing is, they can't simply leave it behind at 4 pm and get on with their life. The demands on them continue into the evening and on weekends.
And then there's the day-to-day obligations that these professionals happily fulfill. I'm a Facebook friend with a fabulous teacher I know and after the rain/slush/snow storm we had the other day, she wrote
"sure not looking forward to a multitude of soggy snowsuits, boots, clothes socks and shoes today. Undressing is bad but helping them put them back on really sucks." Often, she brings extra dry clothing for the kids, a very loving gesture that goes unnoticed.
Most of the teachers I knew when my kids were going through the system are now retired. I know a lot of them professionally and personally. This is what I've noticed.
Their lives are still busy. They continue doing what they did when they went to class everyday. The only difference is, they aren't getting paid and they're doing it for adults.
As teachers, they learned to organize. They got really good at it, or they failed in the school system. So it's only natural that they would continue in retirement.
If you live in a condo and you need a volunteer to assume the role of secretary-treasurer, ask a retired teacher. If you're hosting a food drive and need drivers to deliver, ask a retired school teacher. If the government of the day is cutting funds to the breakfast program and you'd like to do something about it, ask a retired school teacher. If you need to sell tickets to your church raffle, ask a retired school teacher.
They remain engaged in the world around them and we're all richer for it.
One of the many annoying things about the Rogers/Bell monopoly (or as some call it, dualopoly) is their god awful follow up service. Funny thing is, they are friendly and accessible when they are in pursuit of our business but once something goes wrong, they run for cover. It's sort of like the makings of a failed marriage... love at first, great sex and blissful days morphing gradually into indifference only to be replaced with resentment ending with a messy divorce. It makes me wonder how one could really divorce either of these corporate giants given their reach into society and our lives not to mention their high priced divorce lawyers at their fingertips poised to make our lives miserable.
It's the same with the small business man who comes to repair your refrigerator and fails to show up on time and then blames you for getting the time wrong. The convenience store owner at the foot of your street who refuses to accept a return of the sour milk you just bought. A more aggravating and much more serious matter is the local Realtor who can't be found the day before closing when there's a dispute over the chattels or some such thing. It's sort of part and parcel of the "It's not my fault" culture we live in. Plagiarist Margaret Wente and Mike "I filled out the form wrong" Duffy are two of he more recent examples of the unaccountable society we live in.
I want to publically state in this blog that if something happens that interferes with the successful completion of one of our sales, Karen and I will answer our phone and deal with the issue head on. I also want to state that if I'm ever caught standing over a bad politician with a smoking gun in my hand, I will never leave the scene of the crime, even if there's the slightest chance I'll get away with it. I'll stay and take it on the chin. That's what the late Bill Fremlin taught me as a child (not that he ever shot a politician although he might have wanted to, but that's a blog entry for another day).
If only Rogers and Bell had a good father to show them the way. The world would be a better place.
I was at a meeting yesterday where a gaggle of Realtors shared stories about the real estate market and how it's performing this winter. Given the many hundreds of young Realtors recently licensed, I was surprised to see that the majority of attendees were seasoned professionals. There was a brief discussion of the short supply of listings and the influence the dreaded Land Transfer Tax was having on Toronto real estate.
Most of the comments were uninformed and anecdotal. In other words, the agents were basing their conclusions on too little information.
Trends in real estate are at best impossible to predict. However, most if not all of the surges in real estate prices can be explained two ways. First, by studying the government/industry monetary policies. In other words, when policies encourage consumer confidence, consumers spend. When consumers spend, they buy and sell houses.
Secondly, one would be advised to follow someone like the famous demographer, David Foote and read what he has to say about how demographics define our present and our future. To that end, RE/MAX Atlantic Canada just sent out a press release on what to expect in the months to come. The summary (see below) says more about where we're going than anecdotes we share at a real estate meeting.
Oh, by the way, if I can add my own anecdotal evidence to the mix, what you read below is what we're experiencing in our own day-to-day business.
Mississauga, ON (February 21, 2013) - Against a backdrop of strong equity gains and lower interest rates, move-up buyers are once again set to ramp up their role in major Canadian housing markets, according to a report released today by RE/MAX.
The RE/MAX Move-Up Buyers Report found that activity in traditional move-up price ranges have climbed year-over-year (2012 vs. 2011) in 87 per cent (14) of the 16 markets examined—a trend expected to continue throughout 2013. The only exceptions were Victoria and Vancouver, where softer sales activity was reported. Driving the upward movement has been substantial price appreciation in most major centres. The average Canadian home has escalated 93 per cent over the past decade; individual markets experienced increases ranging from 62 per cent in Saint John (4.96 per cent compounded annually) to 199 per cent in Regina (11.57 per cent compounded annually).
If you've ever been involved in a focus group, you'll appreciate the value they offer. Karen participated in a session with her Mastermind group yesterday and the results were helpful and quite interesting. The participants were not selected randomly as they usually are. Rather, they all belonged to the same organization and came from the same socio-economic community.
This was facilitated by Wendy Chong, a communications consultant specializing in presentation skills coaching at Elevate Your Presence..
The question was, what do you value in a Realtor?
Here are some of the notes recorded by the facilitator:
Don't want to speak with an assistant
Honesty
Integrity
Good Listener
Good negotiator
Don't waste client's time
Experience
Disclose the why
Anticipate my needs
Secrets of the area
Be a facilitator between husband and wife and manage both visions
Passion
Want to know inside scoop of other agent and negotiating strategy
Some of this might even apply to other service oriented professions.
After one of our listing presentations recently, Karen and I were standing on the front steps with the Seller when I quipped that we practice Zen Real Estate. It was one of those "what was I thinking" moments but the Seller acknowledged with his warm smile that he knew what I was talking about. After giving this a bit more thought, I concluded that our approach does share some Zen-like characteristics.
A few words come to mind...
Egoless: Neither of us will let our own biases interfere with the process.
Order: Perhaps a better description would be absence of chaos.
Focus: There's a reason for everything we do.
Movement: We "work" a listing until the sale and closing are complete to everyone's satisfaction, never allowing it to stagnate or get stale.
Inclusive: The sellers are encouraged and expected to be as involved as they desire.
Team: We include any and all professionals that will expedite the sale.
Responsible: We are hired to do a job and our hands-on approach steers the selling wheel each step of the way.
Steps: Our responsibilities are purposeful, that is well defined and thought out.
Control: Our sales do not careen out of control, regardless of the pitfalls we encounter along the way.
Timing: Yes, we do complete each step but the "when" is as important as the content.
Pleasure: If we honour all of the above steps, the process is an enjoyable journey.
One of the more common questions we hear in our industry relates to small investors buying houses that need work hoping to flip them for a tidy profit. As with any business, the newbies struggle at the beginning. Most who try it once seldom try it a second time. There are many reasons these projects don't make money, most of them stemming from inexperience.
Those who succeed work within a very strict formula and never waiver.
I recently received a phone call (from a sign in the front lawn of one of my listings) from a local renovator/builder and I knew immediately he was successful. I knew because he didn't ask questions that would have no bearing on his decision to buy the property. For example, he didn't ask about the wiring or the plumbing. Why bother? He was going to replace it all regardless. The fact is, he wasn't all that interested in the house. It was the lot that he was going to offer on. He was all business. He impressed me.
He told me "I have 4 or 5 projects going at any given time. I only work within my specified neighbourhood. I know the area, what the buyers want and I renovate accordingly. A $150,000.00 profit is built in to each project. The renovation will cost around $100,000.00. My turnaround time is 3 months for the renovation plus however long it takes to get the permits. I know ahead of time what I will sell the house for and how long it will take to sell."
If he offers on my listing, he'll act quickly and offer the price he needs to make the project work and the closing will be whatever the seller wants. If he doesn't get this house, he'll simply wait until the next opportunity and go through the process all over again.
The only number I question is the cost to renovate. $100,000.00 sounds low, even for an experienced builder. He told me has a tough time finding good tradesman. Maybe he keeps his costs low by paying them a pittance so they don't stick around very long.
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