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Some strategies for getting top dollar
Saturday, March 09, 2002
Selling your home is easy in a hot market, but getting top dollar is another challenge. Consider these strategies before putting up the "for sale" sign.
Prepare your home for sale.
A detailed preparation of your home can be worth thousands of dollars, according to Toronto real estate agent William Wallace of Re/Max Unique Inc. He says painting -- everything from basement floors to hallways -- yields one of the highest returns for the dollar.
Make rooms and closets appear larger by putting some furniture or clothes in storage elsewhere. Reduce clutter by clearing away items on bathroom vanities and kitchen counters, and have your windows cleaned. "Homes that are bright and light sell for more money," he says. If you have nice landscaping but are selling in winter, leave photos around that show off your garden. "You are trying to communicate to the buyer that this is a spacious, lovely, tidy, move-in condition home," he says.
Price homes realistically
and create bidding wars.
Interview agents to find how they how would market your house. (A few will even host catered luncheons at the agent's open house to get more colleagues through your door.) Most sales occur from showings by agents with serious buyers, while weekend public open houses tend to attract nosy neighbours and are often a way for many agents to find potential clients, Mr. Wallace says.
Sellers should ask agents about recent sales to see how well they did relative to the original list price, and ask at what level they would price your home. The price should be comparable with homes that are similar in size and renovation in your area. Be wary of agents who suggest an unusually high price because they may do so just to get your listing.
On the other hand, some buyers may insist on selling at a high price. If the house then doesn't sell in a hot market, the seller could end up with a "stale listing" followed by price reductions, Mr. Wallace warns.
Sellers in hot neighbourhoods might get a higher-than-expected amount by listing at an attractive price, and having showings for three to five days before accepting offers. Doing this over a weekend tends to attract more potential buyers, he argues. "The difference between two offers and getting five offers might be the difference between getting $15,000 over list, and $40,000 over list."
Negotiate your sales commission.
Commission structures, which vary across Canada, are more negotiable in a hot market and dickering should be done before signing a listing agreement, says Toronto real estate lawyer Alan Silverstein.
"There is no rule, no law or bylaw that says it has to be 5 or 6 per cent, or whatever." Sellers must pay goods and services tax on top of the commission, but there is nothing that prevents them from trying to negotiate a structure that includes the GST, he adds.
Mr. Silverstein says listing agents may "adjust" commissions if they do more than one transaction -- such as selling your home and helping you buy another one, or acting as a "dual agent" in getting the buyer.
An agent, he says, might reduce the commission to 4.5 per cent from 5 for a transaction. (The listing agent might take 2 per cent while 2.5 per cent goes to the buyer's agent.) "Is an agent going to blow a deal to get a listing over half a percentage point if [a house] is going to sell within a week or 10 days?"
A tale of four cities
Average resale home prices
Toronto Vancouver Calgary Montreal1991 $234,313 $221,874 $128,255 $114,379 1992 214,971 245,260 129,506 113,688 1993 206,490 279,758 133,998 114,293 1994 208,922 303,535 133,571 113,712 1995 203,028 307,747 132,114 109,929 1996 198,150 288,268 134,643 108,020 1997 211,307 287,094 143,305 112,362 1998 216,815 278,659 157,353 115,573 1999 228,372 281,163 166,110 119,689 2000 243,249 295,978 176,305 125,333 2001 251,508 285,910 182,090 128,851
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