Real Estate Talk:
What to do and how to get them
By Joseph Marovitch
Previously published September 12, 2018
The purpose of a real estate professional is to remove the emotion from the equation of selling the property. There is a tremendous amount of emotion involved in selling a home from the perspective of a seller. Emotion can cloud judgment when pricing the property.
The seller has been living in the property for a long time and everything in the property is to the taste of the seller, therefore in the eyes of the seller, the property is perfect and therefore who would not want to buy the property at whatever price?
Other times, from an emotional point of view, the seller has bills to pay or items they need that cost money that the seller hopes to acquire from the sale of their property. This issue causes sellers to overprice their property.
The purpose of a real estate professional is to remove the emotion from the equation of selling the property.
The fact is there is a price point that a property will sell at whether the property is priced too high or at market. The only difference is that the property will take longer to sell if the price is too high. The property will sell sooner if it is priced within the market. No matter what the situation is, the property will still only sell at the price the market bears.
At this point, the market price point, every comparable property within a specific neighbourhood has a price scale within which the property will sell. Where the seller’s property is placed on the scale is dependant on two factors.
The first factor is the condition of the property. If the property is not in good condition, then it would be placed on the lower end of the scale. If the property is in excellent condition, it would be placed on the higher end of the scale.
‘… every comparable property within a specific neighbourhood has a price scale within which the property will sell.’
The second condition is the time factor. If the seller wants to sell sooner, then the property would be placed in the lower end to mid range of the scale. If the seller is not in a hurry to sell, then the property would be places on the higher end of the scale.
Within the scale, there is always a price point that is perfect. This is the price that appeals to all buyers. When a property is priced to near perfect, many buyers will view the Centris listing, many buyers call to arrange visits to the house and many buyers will present offers. Many offers, at the near perfect selling price, translates into multiple offers.
It is in the situation of multiple offers where the seller may end up selling for more than they are asking.
The problem is that many sellers are sceptical of pricing their property at the near perfect selling price, so they usually price high and wait longer to sell at a price that will either be the price the market bears, or less, because the property has been on the market too long.
‘Within the scale, there is always a price point that is perfect. This is the price that appeals to all buyers.’
The process of properly pricing and selling a property is not rocket science, but emotion and other factors can get in the way, which can result in losing both time and money.
In the end, it is the market that determines the price. The seller must know and understand the market, where it is and where it is going.
Next Weeks Topic: Pricing considerations in residential and income property
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Have a great week!
State of the market
One of the factors driving prices up in Quebec is that there is no restriction on foreign investment, unlike Vancouver and Ontario. Foreign investors have purchased in all sectors including single homes, condominiums and income properties.
Recently, in Vancouver, Justin Trudeau announced that if re-elected, he would impose a one percent tax on foreign-owned property nationally. The intent would be to curb foreign investment in favour of Canadian buyers in an effort to ease prices. Should it come to pass that a national Canadian tax is imposed on foreign investment, I do not believe this will stop prices from rising in and around Montreal.
Montreal is still an island and it is only 375 years old. Rome, Paris, London and Hong Kong are thousands of years old. Real estate prices in those cities are much higher than in Quebec because they have developed over time, are surrounded by bodies of water, have run out of space, and are developed beyond their limits. Montreal is relatively young, developing and passing its limit of the St Lawrence. Combined with a growing economy and stability, Quebec real estate will continue to rise in price.
Read also: Other articles by Joseph Marovitch
Joseph Marovitch has worked in the service industry for over 30 years. His first career was working with families from Westmount and surrounding areas, hosting children between the ages of 6 to 16 as the owner and director of Camp Maromac, a sports and arts sleep away summer camp established in 1968. Using the same strengths caring for the families, such as reliability, integrity, honesty and a deep sense of protecting the interests of those he is responsible to, Joseph applies this to his present real estate broker career. Should you have questions please feel free to contact Joseph Marovitch at 514 825-8771, or email@example.com