Sales Up, Inventory Low

by Darrin DeRoches July 10 - 16, 2014

The month of June has shown big numbers in Sales and Listings. The market is strong and people are on the move. There were 2215 properties listed in June which was an 11.5 per cent increase over last year but the inventory was down by 5 per cent by the end of the month. The sales for June were 1572 properties with and average sale price of $399,917. This represents a 15.6 per cent increase in sales from the same time last year.     This is showing how strong the market is plus the fact that people are making moves in the market. Prices are rising by about 5 per cent from last year and everyone is reaping the rewards from this strong market. The average time that a house sits on the market is about 35 days which is down from last year. This all points to a strong market which creates a low inventory and this means that if your house is not selling, it can be due to one of two things. Either it is overpriced or your agent is not marketing it properly.     Every house has a buyer out there but in some instances it may be hard to find the buyer if you are priced wrong or not being serviced properly. Some agents just put the house on the system and wait for the phone to ring. The problem is that the phone is not ringing because the house is overpriced. Then there are the properties that are priced properly but the agent is not actively working the leads and making a sale happen. Some agents do not help the process along and buyers decided to purchase competing homes instead. If your home is sitting on the market longer than the average home, you should take a serious look at your situation. Is it the price, the agent or the home itself? You may need to do some painting, landscaping, change the price or change your agent.     This strong market does not create dumb buyers or huge competition. Buyers are still informed and you have to present your property in its best light to get the fast sale. Top dollar and quick sales only happen when everything is working in alignment. The agent and the seller work together to make the property presentable, priced right, and marketed properly. This time of year you have to watch out for long weekends and weather to hit the market at the right time. Having an open house on a long weekend and asking for offers that same week is a huge mistake. You cannot do a price drop when nobody is paying attention.     The sales are up and inventory remains low but you still have to work to get the best price. There are still good deals in the market you just have to know when to make an offer and see what the market has missed since everyone is about to either go fishing or take a vacation. Timing can be everything. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.

No Inventory In West End

by Darrin DeRoches July 17 - 23, 2014

I have clients who are looking to spend $400,000 dollars for a property in the west end and we are unable to find a suitable property. Ideally we would like an investment property and if not they would spend a little less and buy a single family. The inventory is so low and we have looked at everything that has hit the market, so we started to re–look at what is out there and it amazed me how out of whack some properties are priced.     This week an investment property dropped their price again to $399,000 so my clients got excited and figured it was a deal since it was originally priced around $490,000 months ago. We booked a viewing and were ready to make an offer before anyone else noticed the drop in price. Once we viewed the first unit we realized the property was in need of major repairs. On paper the property hit all the right boxes and it should have an income on $2400 a month and would work at the $399,000 price. Once we viewed the second unit it would take over $50,000 to update the property but its layout would still be an issue and it would be hard to rent the property at full value.     We moved on to another property that was listed last week and it was over our budget but we figured we could get the bank to go higher if the property was move-in ready. The listing did not mention anything about “as is” or “renovation” so again we were hopeful. Once we walked into the open house the agent immediately explained that the house needs about $50,000 in renovations. New furnace, kitchen, bath and the list went on. I was again amazed at how they could list a property that seems to be a little overpriced for the market but since inventory is low maybe they could get it. Now it needs over fifty grand which brings the house to at least $70,000 dollars higher than what we can afford, but in reality at least fifty thousand over what the market will pay.     I noticed that there were a lot of real estate cards on the mantle and asked the agent how the showing was going and he mentioned that there was an offer but that it was “low ball”. I had to bite my tongue since the amount of agents through the property tells me that they also believed the house was move in ready and the low ball offer was probably on the money.     This time of year the market slows down and what is left up for sale tends to be a project or overpriced. My clients are eager to buy and they will move fast to get a deal done but you have to step back and wait until the market starts to move again and enjoy the summer. A few good properties have come up and have sold quickly. We will keep on the ball and wait until the right one hits the market. I am pretty sure that the ones that are sitting on the market will still be there. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.

Thirty Day Closing

by Darrin DeRoches July 3 - 9, 2014

The market is moving very fast and this week I spoke to two different sellers who have thirty days to close their property and move on. Where are they going to go? The first seller sold their home by themselves and figured they could do it without an agent. They received an offer from someone who had to sell their present home and waited for months to see if the deal could come together. Last week they had a second offer to close the home in thirty days. They were very stressed and had to figure out who was going to buy the property, when, for how much and most importantly, if they took the second offer with a quick closing – where were they going to go?     As a broker I would have handled the whole deal in a different manner and dealt with all of those issues. The property is listed for $589,000, when it is worth over $630,000, and they would have had more offers – especially in this market – if they used a broker who would have marketed it and had a lot more exposure. This alone would have brought better offers and a higher price. They went with the quick closing and lower price and now have to find a place to live temporarily as they wait on their next move. Again, we could have arranged a better time frame to align their move and dealt with other agents to accommodate the right terms etc.     The second seller is a guy who split with his common law girlfriend who sold their property and now have thirty days to close. His situation is a lot simpler as he will just pack his bags and couch surf until his next move. This situation happens all the time. It seems men just want to “get out” of a situation and have no real need to make the next move. Then they realize it is time to buy another property as they do not want to rent forever. Once the deal is closed and they have the money figured out and a big cheque gets deposited in their bank, then they want to buy. Even though they know the money is coming they usually do not want to make the move until they actually have the cheque in their hand. Then we get the call to buy and buy something quick.     The market is still moving fast and you have to have a game plan to deal with it. This time of the year is when thirty day closing happens more often as people want to take the summer to make the switch and get into a new property before school starts. Think ahead and communicate your plan with your agent. Time and money are what most deals come down to so being prepared will bring the best results. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.

Cooling Off Period

by Darrin DeRoches June 26 - July 2, 2014

When buying a new condo in Ontario there is a ten day “cooling off” period where you are allowed to walk away from the deal. This is when you can take stock of what the condo has to offer and if you bought the right condo. Your deposit has to be returned to you in full and you can walk away from the deal with no deductions. This only applies to “new” condos and not resale condos, but if you are working with a real estate professional they would have similar clauses to enable you to rethink your purchase.     This cooling off period is a time to get your lawyer to look at all the documents. A condo developer can put in a lot of clauses and descriptions that may or may not be what a buyer wants. There can be hidden fees; costs etc. and a buyer will want to have their lawyer take a good look at all the documents. The buyer will also want to check out other developments around the new condo to make sure their views, amenities and overall prosperity of the development will be delivered as laid out in the sales brochure. During these ten days, a buyer should also get their bank involved to make sure that they will have a mortgage on the unit once it is completed. If a bank does not like the development, they may not fund your mortgage.     Most of the legal and financial things will work themselves out during these ten days but buyer’s remorse may kick in. This is usually the biggest problem with people walking away. In most new sales of condos there is a big kick off and frenzy can occur. New buyers get caught up in buying a condo and they do not really take into consideration all of the factors. A couple of days later you tell your friends and family about your new purchase and someone who thinks they know it all starts to put doubt in your mind. They ask how much did you pay per sqft? What floor is it on? Do you know what else is in the neighbourhood? You answer all their questions and no matter what you tell them – you are a sucker!     No one is happy that you just bought a new condo and most likely will make thousands if not tens of thousands of dollars on your investment. They will tell you that you paid too much per sqft. Who is going to live there? You have no view. Everything and anything to discourage you from completing the deal. You can tell them the project sold out and that you made thirty to sixty thousand dollars on the unit once it is completed. They will still give you an opinion on why you should walk away because they are jealous.     During your ten day cooling off period, take everyone’s opinion into consideration but remember why you made the decision to buy in the first place and close on the deal. Trust your gut, do not be influenced by others’ opinions, and look at the numbers – they do not lie. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.