Envelope Real Estate Brokerage Inc
181 Commissioners Road W London, ON N6J 1X9
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How To Price a Home


 How To Price a Home When It Is A Sellers London Ontario Real Estate Market

Meeting a Realtor

  You have decided to sell your home and have a fairly good idea of what you think it is worth. Being a sensible home seller, you schedule appointments with three local real estate representatives, (or a friend of a friend who has a friend). They set up a time with you and maybe arrive with a “Competitive Market Analysis” (which no longer is an accurate tool, I’ll cover that in another report) and they each recommend a specific sales price.

  Amazingly, two of the Realtors have suggested prices that are lower than what you expected. Even though they have backed up their recommendations with recent sales data of similar homes, you remain convinced your property is worth more.

  When you interview the third Realtor’s figures, his or her numbers are much more in line with what you think your home is worth. Or they may have even suggested to you a higher price. Wow! Now you are happy and an exited home seller, perhaps already counting the money.

   A Sales Practice Called “Buying a Listing”

  If you are like most people, you have chosen Realtor number three. This is a Realtor who seems willing to listen to your input and work with you. This is a Realtor that cares about putting the most money in your pocket. This is a Realtor that is willing to start out at your price and if you need to drop the price later, you can do that easily, right?

 After all, everyone else does it! Wrong!

  The truth is that you may have just met a Realtor engaging in a questionable sales practice called “buying a listing.” He/she “bought” the listing by suggesting you might be able to get a higher sales price than the other realtors recommended. Most likely, he or she is quite doubtful that your home will actually sell at that price. The intention from the beginning is to eventually talk you into lowering the price.

  Why do some “buy” listings this way?

  There are basically two reasons: A well-meaning and hardworking Realtor can feel pressure from a homeowner who has an inflated perception of their home’s value. On the other hand, there are some who engage in this practice routinely.

Overpricing a property in London Ontario

  If you start out with a price that is too high, there is likelihood you interviewed other Realtors. They did not get the listing, of course. They got “beaten” out by someone telling you what you wanted to hear.

  If your listing Realtor routinely engages in “buying “listings, he/she has probably has done this to other Realtors in the same way. Word gets around that their homes are overpriced and the home seller has an inflated value in mind. This can be very difficult to resolve.

  In short, you may have ended up with a Realtor who was good at selling you, but not good at selling your home. Are willing to pay them a fee for it?

wasting your time

  It is human nature for you to want the highest price for your home. However, when you choose the Realtor who promises what you want to hear, it often leads to stress and frustration. Most of the time, it will take you longer to sell your home. Possibly, and this happens, you will end up selling at a lower price instead.

   I know, I know, I know,  it is a seller's market but even so, do you know how many homes that have been sold , even over the asking price and still, the seller left money on the table? 

   What Happens Behind the Scenes?

  If you start out with too high a price on your home, you may have added to your stress level—and selling a home in London Ontario is stressful enough! There will be a lot of “behind the scenes” action taking place that you don’t know about. Contrary to popular opinion, a professional listing Realtor does not usually attempt to sell your home directly to a home buyer. That would be inefficient.

   The majority of Realtors market and promote homes to hundreds of other local Realtors and even Realtors from the GTA areas who do work with home buyers, dramatically increasing your personal sales force. During the first couple of weeks your home should be a flurry of activity with buyer’s agents coming to preview your home so they can sell it to their clients. (See my report “When is the most important time for a new listing)

   If The Price Is Right

   If you and your Realtor have overpriced, fewer Realtors will preview your home. After all, they are Realtors, and it should be their job to know local market conditions and home values. If your property is dramatically above market, why waste time? Their time is better spent previewing homes that are priced realistically.

  Dropping Your Price Too Late

  If you start out with a high sales price, then drop it later—your property is “old news”. You will never be able to recapture that flurry of initial activity you would have had with a realistic price. Your property could take longer to sell.

Price reduced

 

   Even if you do successfully sell at above market price to an uninformed buyer, your buyer will need a mortgage. The mortgage lender requires an appraisal. If comparable sales for the last six months and current market conditions do not support your sales price, the property won’t appraise. Your deal falls apart. Of course, you can always attempt to negotiate the price, but only if the buyer is willing to listen.

  Your property then goes “back on the market”. Other Realtors will know this, as will their buyers, what do you think their response will be to your home?

  Once your home sits on the market awhile, it is harder to get a good offer. Potential buyers will think that you might be getting desperate, so they will make low offers. By overpricing your home in the beginning, you could actually end up settling for a lower price than you would have normally received.

 In summary, when you decide to sell your property, why not work with a Realtor who knows the market and is financially and emotionally strong enough to guide you? Who will not tell you what you want to hear. The truth hurts but you might as well hear it now than 1 month later!

   To get results, "Making assumptions is the mark of a lazy communicator!"


A Few Secrets When Selling a Home


             The Secret to Pricing Your Home to Sell

  A home without a buyer has no value in the market place. Sure it might have a value to you the seller, and it might have a value to your banker, and to your insurance agent, and to your appraiser. But none of these people are buyers.

  Answers to Pricing a Hone Correctly

   So here is the secret to pricing your home to sell - It's not what you think the home is worth that matters, it's what a reasonable buyer will think your home is worth that will ultimately determine if your home will sell.

   Now you may be thinking - Hey wait, if I left it up to a buyer, they would pay me as little as possible for my home. True, they would. But in the real world every buyer knows that you, the seller, have no obligation to sell your home at any price. To purchase your home the buyer will have to make you an offer you can't or won't refuse. 

   But here-in lies the trap that many sellers fall into (I did when I first started in the real estate business), which is the mistaken idea that we can hold out for an inflated price and eventually the market will come to us.

  Wrong!

  Buyers are under no obligation to buy any particular home, and no amount of marketing, open houses, websites, or signage will motivate a buyer to purchase an overpriced home.

 Why?

  Because they can buy one of your neighbors homes for less! This reveals one of the most important considerations in pricing your home - Price VS Time.

  Understanding Price VS Time

   The age old dilemma that has faced buyers and sellers since the dawn of private property rights is a simple question:

  What is more important ,price or time?

  Believe it or not this conundrum underlies and controls every sellers decision to sell, and every buyers need to complete a purchase. For sellers this boils down to the need to sell within a set time frame or instead to hold out for the best possible price, and as you might guess, for buyers it's the need to buy within a set time frame or to purchase a home for the lowest possible price.

   A seller who would like to sell for top dollar should be prepared to potentially wait longer for a buyer willing to pay a premium price. Like trying to sell ice during December, a seller might have to give the stuff away just to get rid of it, but if they wait long enough, say until mid-August when temperatures crest over 100 degrees suddenly that same ice can have real value. On the flip side, a seller who needs to sell quickly, and doesn't have time to wait, should expect to discount their price somewhat because of the limited time they have to expose their home to the market.

   What's the difference?

  Timing!

   Buyers are in the same boat. A buyer who has the luxury of shopping for a home over a long period of time can probably wait to find a bargain, while another buyer who must buy a home in the next few weeks will probably be willing to pay a premium. Again it boils down to price vs. time. So you might ask yourself what is your highest priority - Selling quickly or selling for a higher price?

   When I pose this question to my own clients they answer - I want both! The funny thing is that they aren't kidding!

   Quite a few home sellers want their cake with icing on top. Because of this, many homeowners will attempt to put the responsibility of getting both top dollar and fast sale on the back of their hired gun, the real estate agent. The result can be summed up in one word - frustration. Why? Because no matter how much a seller yells, screams, and kicks a real estate agent, they don't do miracles.

  This is why successful sellers understand that while a real estate agents job is to provide marketing, expert advice, and negotiating services, in the end they don't own the property. They don't make the final decisions on pricing. The seller does, and ultimately the seller's asking price will in large part determine how slowly or quickly the home will sell.

  Successful sellers have learned that to price their home accurately means they need to think like a buyer, they need to get inside a buyers skin and look at the world through a buyers eyes. If you're like most buyers you would probably start online by viewing listings to get a general feel for local home prices. 

 Searching for houses for sale in London Ontario

   As a typical internet empowered real estate buyer you will look at an average of nine homes over 1-2 weeks with the assistance of a real estate professional. By the end of your journey, like many buyers, you become so knowledgeable about the market that by the last showing you are able to guess, with reasonable accuracy, each homes listing price before your agent can even tell you.

  So what happened here? As a buyer you went from a blank slate, with no impression of the market to having the ability to predict listing prices. A big leap sure, but this description is exactly what most buyers' experience. 

   So as you can see, pricing to sell your home is not the price your neighbour suggests, or a friend of a friend, or to recoup your costs of a poor renovation or upgrades.

   When we do an Envelope Home Audit and a thorough CMA, you can rest assure that the price we come up with is the one that will enable your home to sell quickly and for you, netting the most money. Remember, homes that that sell for the most, sell quickly!

 

 


How to Get More For Your London House or Condo


  Here’s an informative  guide  to  help  you  realize the  most  profit  from your  home,  and perhaps avoid  costly  repair  rip-offs.

      There’s a little-known dynamic in real estate that can dramatically affect the successful, top dollar sale of your home.  

The Elements That Motivate a Quicker Home Sale…

Are the Same Elements That Sell Homes for Top Dollar

      Each year thousands of homeowners needlessly lose thousands of dollars when selling their home.  But they don’t lose the money for reasons you might think. They lose money because they unknowingly left it on the table…for the buyer to pocket…by failing to recognize the hidden profit potential of their home.

   small home repairs allow a large return

  And those hidden profits exist in two areas. 

      First, most homeowners never discover that certain small, even inexpensive repairs to their existing home could generate many times their cost in additional home value.  But on the other hand, other repairs and improvements can cost you dearly.  It’s critical to know what repairs and improvements to spend money on…and which ones to leave alone.

      Second, when many savvy homeowners decide to make profitable repairs before selling, they expose themselves to the ruthless world of some contractors and their potentially deceptive schemes that drive up the costs of home repairs.

      Between not knowing what to repair for maximum profit, and dealing with the world of contractor woes, it’s easy to understand how you might become overwhelmed with the whole process.  But don’t despair.

That’s Why I Created This Helpful Report

       I am going to reveal to you exactly what areas make sense to fix and what areas to leave alone…not using “opinion,” but real world facts.  Then, I’m going to give you a “behind the scenes tour” of the games some contractors play when fixing your home (by the way, not all contractors are sinister – I know many with stellar reputations).

      This way you’ll be armed to the teeth with knowledge and strategies to stay one-step ahead of the game…and maximize the value of your home when you sell.

 Many of the improvements that have the most value for you as a homeowner end up being the worst-performers as far as resale value is concerned.  ​

 I will cover:

  • How to Select Home Improvements That Pay Dividends

  • Functional and Structural Improvements  

 

  • How to Dodge Repair Rip-Offs When Improving Your Home

  • Selecting Painters     

 

  • Selecting Plumbers

  • Selecting Electricians

  • Selecting Roofers

  • Selecting HVAC Specialists   

 

    I would be very surprised and quite actually disappointed if you did not save at least a $1,000 by reading this report. All homeowners have had to get estimates from trades people, and yes, there are some real honest, good ones out there, but how do know?

 This report will at least keep them honest!

A Home Seller's Guide For Money Saving Fix Ups
Here’s an informative guide to help you realize the most profit from your home, and perhaps avoid costly repair rip-offs. Each year thousands of homeowners needlessly lose thousands of dollars when selling their home. But they don’t lose the money for reasons you might think. They lose money because they unknowingly left it on the table…for the buyer to pocket…by failing to recognize the hidden profit potential of their home.
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How Not To Price Your Home For Sale in London Ontario and Area


            How not to price your house in London Ontario

  • Take your mortgage balance.
  • Add your credit cards.
  • Throw in your cars.
  • Add a generous portion of all the money you borrowed from relatives. 
  • Pile on your down payment for that other house you have your eye on.
  • Last but not least, give yourself an extra $25,000 for just for being you. 
  • Get a blank look on your face when you are told by a professional listing Realtor that the buying public doesn't care what you owe. 
  • Wait
  • Wait some more. 
  • Decide you'll stay after all. 

​                           how to sell a home in London Ontario

          Here's a better plan:

  • Find out what homes like yours have sold for in the past 90 days
  • Price the house at that number or 5% less. 
  • Pack your bags.

      The buying public is utterly ambivalent about what you owe to who as it relates to pricing your property. They only care about their own needs. What you need isn't on their radar, and if you aren't priced in line with the current perception of value, your listing will get stale and sit unsold for months as you chase the market. 

  Chasing the market is always being one price point behind what the public is willing to pay. You enter the market at $459,900 when you really ought to be at $449,900. You lower to $449,000 when the market for the house is $439,000. By the time you hit $429,000, it could be 2 months later and the public isn't willing to pay more than $420,000. (True story)

  Each price drop seems harsh, but your real enemy was you starting out too high. 

   overpricing a house

  Sellers are in a war of attrition with buyers who lurk before they call, call before they look, and look at everything before they buy. You won't get a call, look or offer until your price conforms to what the public deems fair.

   The only offers overpriced homes get is low ball offers from bold types who wouldn't pay as much as fair minded people would on a fairly priced home. The only way to win the battle is to price your home at the market price and not allow your ego or personal preferences to cloud your objectivity. 

 Why go into a battle if you cannot win?