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I took a small break from blogging yesterday as the last couple of days have been filled with packing and meeting with clients, but I’m back today!
I decided to vent my frustrations today based on last nights events. I have been working with a couple looking to purchase their first property for some time now. They are getting married and would like to buy something before the big day arrives. Since it’s been such a crazy market with multiple offer on every corner, we have been having a tough go at it. We finally found something we like over this past weekend and surprise, surprise, it has an offer deadline. So we wait patiently, praying to the real estate gods every night that the house doesn’t receive multiple offers so we can come in there and scoop it up below asking price. I prepare the offer the day of and leave the purchase price blank. I contact the listing agent asking her to keep me posted of any other offers so that we can make a final decision on the purchase price. I run some comparables on the property and although it’s listed $449,900, which I think is slightly over priced with an offer deadline, we decide that the home is not worth more then $435,000-$440,00, not too far off from the listing price.
Finally the time comes and it seems like our prayers have been answered, we are the only offer presenting tonight! So we finally finalize our offer by writing in our purchase price, which does have some wiggle room, we can’t show all of our cards initially. I present the offer to the listing agent and seller, at the end of my presentation, the listing agent asks me to step outside with her to “talk”. I’m feeling like a school kid asked to step outside with her teacher to discuss my bad behaviour. The next thing that comes out of the listing agents mouth is, “the lowest price my seller will accept is $475,000”. I ask her to repeat this twice for me as I thought I heard wrong. Are you kidding me, $475,000, on a property that is listed $449,900 and did not receive multiple offers!!!!! I bring out the comparables and show it to the agent and ask her to help me understand this price so at least I can try to explain it to my clients. Well, the answer is not what I’m hoping to hear. She says the seller bought this property for X amount of dollars and spent Y amount of money in renovations, so basically what she’s telling me is that the seller wants to recope her costs on the price she initially bought the house for and on renovations that she may have overspent on, plus make a profit. Did someone not explain to this seller that unfortunately, real estate does not always work out that way?
As listing agents it’s our duty to work for our client’s best interest and get them top dollars for their home, but it’s also our job to set their expectations. Majority of sellers believe their homes are castles compared to other similar homes on their street and neighbourhood and it’s our job to put that into perspective for them. As a good agent, we should not be taking listings and pricing them at whatever the sellers tell us, after all, isn’t it the reason why they hired a realtor in the first place? Also I hate when people’s times are wasted. I think I made it pretty clear to the listing agent over the numerous phone calls yesterday that my clients would not be offering full asking price, close to it, but not full, and not without multiple offers. She could have at least given me the heads up on the phone about the unrealistic price her seller was looking for. This would have saved a lot of trees and driving, as my clients would have never even presented an offer. Lastly, even if my clients wanted to pay $475,000, I would feel uncomfortable selling them this home at that price, that in my opinion, would not be working in their best interests.
Needless to say, this listing is being re-listed today at $475,000 without an offer deadline, I’m curious to see if they get any showings, let alone any offers. With the holiday season around the corner, the market is going to quiet down a bit and I’m surprised the seller is willing to take that chance. And what happens if comparable houses in her area keep selling for lower then her target price, it’s further going to make this listing look overpriced and stale. Oh and did I mention this home was previously listed a couple of months ago at this similarly high price and didn’t sell. Shouldn’t the seller take a hint? I think this crazy, hot market has gone to seller’s heads in general, inflating prices of homes all across downtown Toronto. As long as we keep having agents taking overpriced listings, then this vicious cycle will never end.
For now, we are coming to terms with our loss and moving on to the next one. Don’t they say, third times a charm? Let’s hope so for both our sakes!