March 29, 2021
I would like to make it known that when I write blogs of this sort.. it’s not to damage the reputation of the industry!
Every day I meet a new professional realtor with strong morals and great work ethics. This industry is populated with professionals.
That said, I do believe it’s important for the consumer to understand the inner workings of the market from a full-time realtors’ perspective.
With this blog… I hope to do just that.
It’s no secret that due to the hot downtown market. we are seeing 85% of listings come to market with a hold back on offers. This means list Tuesday and review offers the following Tuesday (generally speaking).
This is the right approach if you have a very hot property or don’t quite have the proper comps to support a valuation. I like to think of it as tennis… the ball is put in the buyer’s court to substantiate value rather than the sellers.
This is a strategy that can often be at the advantage of the seller as multiple offers may spawn which would essentially build market pressures… and lead to a higher sale price.
Although.. this has also become a crutch for a listing agent to lean on and not do their homework on a property’s value. It’s simple to get a property valued at about $1.4M to $1.6M and list it at $1.299 with an offer date.
Let the cards land where they will!
I get it.. and I use this strategy as well when it’s difficult to gauge how aggressively the market will react to your listing.
My issue is this:
A condo was listed in King West about 3 weeks ago.. quality small one-bedroom property. They came to market at $499,000 with an offer date and eventually sold for $529,000.
$30,000 over the asking price… fantastic!
The last comparable unit’s sale was done so about 4 months ago.. so this was a strategy which I also would have elected.
The trouble with this…. 2 weeks after the $529,000 sale was recorded… the exact same layout came to market 1 floor above the previously mentioned property… and they listed at $469,000 with an offer date.
That’s just abusing the market in my opinion.
You have a CLEAR comparable.. which anyone can find now with TREB releasing the market’s sold statistics.
You are now drawing the attention of buyers with budgets under $500,000 when the property is clearly valued at $529,000 + (a possible $10k per floor).
I mean.. at least list at the same $499,000 right?! Why go $30,000 under the previous list price when you have more value associated with your unit.
We are now deep into the fall market and there are comparable sales for most properties. I now find it very unnerving to see this type of behaviour when we have patterns created and a good indication of where the market is.
Enough already. let’s try and be a little more accountable on our end as realtors as this type of behaviour is clearly just damaging this industry as a whole.
Always happy to chat more!