Local home Sellers, as well as many Vendors throughout the GTA, under-estimate how difficult it is to choose the best realtor to sell their property. When they do make a choice, they often over-estimate what that realtor will do for them. With over 32,000 licensed realtors on the Toronto Real Estate Board, there is a better chance of choosing a poor realtor vs. a great realtor.
1. WEAK MARKETING
Realtors get Sales Training, but few have Real Estate Marketing Training. Real Estate Marketing consists of: Market Research, Product Research, Product Development, Advertising, Sales Promotion, Public Relations and Selling. Very few know how to incorporate all of these areas of expertise into the marketing programme for your property.
Good marketing distinguishes your home from hundreds of others on the market, selling its many benefits not just its features. A strong marketer gets your property sold fast at top market value. (Jim Reid has a Masters degree in Marketing and has taught Marketing at University and College levels.)
Nowadays, print advertising is not effective for selling a property, but it is quite useful for the agents who use newspapers to find people who are likely interested in Listing their property. People use the INTERNET, not newspapers, to choose properties to visit.
Many Realtors will tell you that only 1% of homes are sold at Open Houses. This is technically true because the visitors to my Open Houses go home to discuss the property before coming back with the rest of their family and then make their Offer a few days later. Some years I can trace 30% of my business to my Open Houses. It takes a dedicated realtor to give up their weekends to do Open Houses for you. Most wait for the Internet and the sign out front to do their job.
Your Realtor© should be using many methods and techniques to attract prospects. Ask your sales professional to provide a list of things they will do to market your home and who they are specifically targetting.
2. PRICING TOO HIGH OR TOO LOW:
Most Realtors encourage you to set your asking price based on Market Value. Appraisers call this objective value. Objective value looks at the condition of the property; it’s location, what properties with similar features in the same area are selling for, what other properties in the same area are listed for, and the overall condition of the economy and real estate market.
If your home is not priced competitively, homebuyers will prefer larger or better homes in the same price range, increasing your time-to-sell. When your price is later lowered, buyers may be wary because they suspect other buyers rejected the house for internal condition reasons and this is why it has remained unsold for so long.
Many Realtors set the price at whatever the lowest number the Vendor will take. These homes are often underpriced and sell quickly. On close to 60% of Jim's Listings, he advised prices significantly above what the owners were willing to accept. Yet, he averages only 21 days to sell his listings.
3. WEAK PROPERTY PRESENTATION:
BUYERS REJECT HUNDREDS OF PROPERTIES INSTANTLY ON THE INTERNET AND AT THE CURB. The first impression must impress or your property will not get considered. Inside, a property that is not tidy, clean and well maintained often suggests hidden defects that will increase the total cost to a buyer. Sellers should make necessary repairs, and spruce up the house inside and out, keep it clean and neat, or risk chasing away buyers brought in by realtors. You don't want Buyers to reduce their Offer price to leave themselves a large margin for error for the cost of repairs.
4. WASTEFUL UPGRADES:
Over-improving your home before you sell it may be a costly mistake. Updates are usually not a problem, but expensive upgrades are usually bought from the Seller's personal tastes and preferences. Buyers often have different tastes and these lovely upgrades become issues in negotiations of the value of the home to the Buyer.
Most buyers will base their decision on purchasing a home based on how they feel about the layout, kitchen, bathrooms and flooring. If these areas of the home meet both their emotional and physical needs it makes it easier to sell a home.
It is a good idea to get a real estate professional to do a market assessment of what your home is worth BEFORE improvements. Jim Reid is experienced in most renovation costs and frequently is invited to discuss before and after property values.
5. CRITERIA FOR CHOOSING YOUR BEST REALTOR:
Jim Reid sells 90% of his listings but the average GTA realtor only sells 2 of 3 Listings they get, (60%). It is clear that the public doesn't do a good job of choosing the best realtor out of the 32,000 licensed realtors on the Toronto Real Estate Board.
A major Vendor misconception is that the "TOP PRODUCERS" or highest volume realtors are the best ones for them. They account for close to 70% of unit sales in the GTA and unquestionably they ARE THE BEST REALTORS FROM THE PERSPECTIVE OF THE REAL ESTATE BROKERS AND FRANCHISORS.
But from a Vendor's perspective, these are the agents who produce the "AVERAGE" results. They sell at only 93-94% of original list price. They take over 52 days to sell from the original listing date. They only sell 2 out of 3 of their listings.
Vendors need to choose the "Cream of the crop" realtors who put the Vendor's interests first and average 97% or better in their negotiations, sell within 21 days consistently and sell over 90% of their Listings.
Many homeowners list with the real estate sales representative who tells them the highest price, or gives the largest commission discount. Others choose a family member who has no local expertise or call up someone referred by a friend or business associate who don't even live in their area.
Sellers should always choose the sales person who provides the most experience and the one the seller thinks has the best negotiating skills. More experience usually mean a higher price at the negotiating table, selling in less time, and with less hassles along the way.
If a Seller has a personal obligation to another real estate agent, Jim Reid gives the other agent a 25% referral fee so that Jim can ensure the Seller gets Jim's personal expertise on this major investment decision.
6. REJECTING FIRST OFFERS:
Many sellers believe that the first offer received will be one of many to come, hoping to hold out for a higher price, especially if the offer comes in soon after the home is listed.
Often the first offer ends up being the best buyer, and many sellers have had to accept far less money than the initial offer much later on in the selling process. The first 2 weeks of the listing term is critical. It is this time that the home will usually get MOST of its action. Do NOT let how quickly the offer came in determine your decision to accept it or not.
BUT... an exceptional realtor will know the likelihood of you getting another Offer within a reasonable time period. They will also know whether the price offered is just a "low-ball" or at least know how to pull the Buyer up to a fair mid-range market value. (A high volume realtor wants one more commission and isn't too particular which party enables this to happen.)
7. OVER SELLING A PROPERTY:
Buying a home is an emotional decision, and buyers are looking to see if a house is comfortable for them. Good Realtors© let the buyers discover the home's features on their own, pointing out only features they are sure are important to them.
When home owners meet buyers in their homes they have a tendency to "Over Sell" their home. The owners talk about all the things they have done to the property and how much they love the area, but all this does is make buyers think they will have to pay for features that are not important to them.
Other times, Vendors say simple things that sound nice and sociable, but end up influencing how the other agent negotiates. In almost all instances, it is best for the Vendors to leave the property when a buyer is visiting.
8. POOR LISTING AND POOR PURCHASE AGREEMENTS:
Selling a property requires thorough written legal agreements. No verbal or "understandings" are valid or enforceable in real estate transactions unless they are in writing.
Standard forms are available to realtors that do a good job of legally protecting everyone, but the terms and conditions can vary considerably. It is crucial that Sellers and Buyers fully understand their legal obligations and rights. Their realtor has had minimum required training, but an experienced realtor can make a huge difference in determining who gets the best deal.
GTA real estate deals are witten in English. Your realtor should have excellent English knowledge and excellent English writing skills. Otherwise, be certain to obtain a lawyer's advice concerning written Listing Agreements or Offers to Purchase your property.
The contract you sign to sell your property is a complex and a legally binding document. An improperly written contract can allow the purchaser to void the sale, or cost you thousands of unnecessary dollars. Have your Realtor© fully explain the contract. If you have concerns then have your lawyer review it before acceptance.
Jim often comes across realtors who don't know how to professionally alter these contracts to reflect negotiated changes properly. Make sure you choose an agent with experience in legal issues and can explain clearly legal clauses.
You can likely avoid all of these common mistakes by choosing a great realtor. Why not start to-day by calling Jim Reid? |
