Ajax Pickering Real Estate Blog

Archive for the ‘Selling Real Estate’ Category

Experts always say that real estate is a great investment because the value of homes is always going up. To some extent, there’s truth in that. But it’s also a fact that the real estate market fluctuates. Many people mistakenly rely on national trends when evaluating the real estate market, however, this could at times be misleading. The key is to focus on and understand your local market.

Focusing on your local real estate market is the key to evaluating real estate deals. This however could be difficult to evaluate since there is often less information on particular areas versus the national situation. To understand your real estate market, here are a few factors to focus on.

Understand the market trend. Sometimes it’s a buyer’s market and sometimes it’s a seller’s market. And there are actually other times when the real estate market is in transition. A transitional real estate market poses certain issues for people who are buying and selling homes and you should be aware of them. This is especially true for anyone involved in real estate right now because the real estate market in many areas is either in transition or could be in transition shortly.

Supply and demand. Real estate is governed by the law of supply and demand. This rule is absolute and without exception. The appreciation of a market, the expectations of buyers and sellers, and the velocity of market sales are all dictated by the supply of, and the demand for, real estate for sale.

New construction is another area to consider when evaluating your market. In this case, we are focusing on supply and demand. The more homes available to buyers, the harder it will be for sellers to move properties. Most communities have some new construction, but the key is to determine if it is outpacing the demand.

Increased job growth and in-migration. Where there is strong growth, there are new workers. New workers need some place to live. A vast percentage of these people will be moving in from other areas and often are bringing money from a previous home. If job growth is strong, your real estate market should be stable and showing appreciation.

Real estate doppler effect. Real estate is governed by the law of cause and effect. Positive situations cause positive outcomes, and vice versa. For example, a vibrant economic growth leads to a vibrant real estate market and strong appreciation of homes, while loss of jobs and a languishing economy produce exactly the opposite effect.

The conditions that make a good market can change literally overnight. All it takes is the entrance of a major employer or a little word of mouth and buyers looking for a bargain and seeing others take a chance, and before you know it, a neighbourhood has turned around. Homes that sat unsold are selling for high prices. Young people are moving in, making improvements, and making the area cool to live in.

A secret to evaluating your local real estate market is to look at people around you. One sign of a hot real estate market is the number of people who suddenly become real estate investors. These tend to be people using the equity in their primary home to make secondary purchases. There is no statistical analysis for this factor. Just keep an ear out for friends or neighbours who are suddenly investing in multiple properties.

Understanding the real estate market requires various skills such as knowledge of land price, an insight for land in the future, the risk factors for a property, laws that apply for property, etc. Moreover, the real estate market has changed tremendously over the year. It takes much time and effort for an individual to understand it completely. The real estate market is an adventurous place to get in to, with the prices of property increasing as the time passes.

If you are thinking of buying or selling a property, consult with your local real estate agent. He or she is equipped with the right tools and knowledge to insure your investment is a successful one.

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Contact the Jeffrey Team for more information  -  416-388-1960

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By Glenn Curtis – Investopedia.com

In a declining real estate  market where supply  outstrips demand, a person can generally sell a house faster by lowering the price. But there are other ways to enhance a home’s attractiveness besides lowering the asking price. If you’re looking to sell your home in a cooling real estate market, read on for some tips on how to generate interest and get the best price possible.

Differentiate From the Neighbours

In order to attract attention and to make your home more memorable, consider custom designs or additions, such as landscaping, high grade windows or an updated roof. This can help improve the home’s aesthetics, while potentially adding value to the home. Any improvements should be practical and use colors and designs that would appeal to the widest audience. In addition, they should compliment the home and its other amenities, such as building a deck or patio adjacent to an outdoor swimming pool.

However, while it can pay to spice up your home, don’t over improve it. According to a 2006 article in Realtor Magazine, some renovations, such as adding a bathroom or a sun room, might not always pay. The data suggests that the nationwide average amount recouped for a bathroom addition is about 75%. For a sun room it’s even less. If you’re going to invest in renovations, do your research and be sure to put your money into the things that are likely to get you the best return. In addition, if you have added any custom features that you think buyers will be interested in, make sure they are included in the home’s listing information. More than ever, in a down market you should take every small edge you can get.

Clean the Clutter

It is imperative to remove all clutter from the home before showing it to potential buyers because buyers need to be able to picture themselves in the space. This might include removing some furniture to make rooms look bigger, and putting away family photographs and personal items. You may even want to hire a stager to help you make better use of the space. Staging costs can range from a couple of hundred dollars for a basic consultation to several thousand dollars, particularly if you rent modern, neutral furniture for showing your home. Many people feel that stagers can make a home more salable, so hiring one deserves some consideration.

Sweeten the Deal

Another way to make the home and deal more attractive to buyers is to offer things or terms that might sweeten the pot. For example, sellers that offer the buyer a couple of thousand dollars credit toward closing costs, or offer to pay closing costs entirely will in some cases receive more attention from house hunters looking at similar homes. In a down market, buyers are looking for a deal, so do your best to make them feel they’re getting one.

Another tip is to offer a transferable home warranty, which can cost $300 to $400 for a one-year policy and will cover a failure by appliances such as air conditioners and refrigerators. Depending on the policy, other appliances and house gadgets may be covered as well. A potential buyer may feel more at ease knowing that he or she will be covered against such problems, which could make your home more attractive than a competing home.

Finally, it’s important to note that some buyers are motivated by the option to close in a short amount of time. If it is possible for you to close on the home within 30 to 60 days, this may set your deal apart and get you a contract.

Improve Curb Appeal

Sellers often overlook the importance of their home’s curb appeal. The first thing a buyer sees is a home’s external appearance and the way it fits into the surrounding neighborhood. Try to make certain that the exterior has a fresh coat of paint, and that the bushes and lawn are well manicured. In real estate, appearances mean a lot. What better way to set your home apart than to make it attractive at first glance?

Get Your Home in “Move In” Condition

Aesthetics are important, but it’s also important that doors, appliances, and electrical and plumbing fixtures be in compliance with current building codes and in working order. Again, the idea is to have the home in move in condition and to give potential buyers the impression that they will be able to move right in and start enjoying their new home, rather than spending time and money fixing it up.

Pricing the Home

Regardless of how well you renovate and stage your home, it is still important to price the home appropriately. Consult a local realtor, read the newspapers and go to online real estate sites, such as Realtor.com to see what comparable homes are going for in your area.

It’s not always imperative to be the lowest priced home on the block, particularly when aesthetic and other significant improvements have been made. However, it is important that the listing price is not out of line with other comparable homes in the market. Try to put yourself in the buyer’s shoes and then determine what a fair price might be. Have friends, neighbors and real estate professionals tour the home and weigh in as well.

Bottom Line

Selling a home in a down market requires a little extra work. Do everything you can to get the home in excellent shape and be prepared to make some small concessions at closing. These tips, coupled with an attractive price, will increase the odds of getting your home sold.

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Contact the Jeffrey Team for more information  -  416-388-1960

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By Glenn Curtis – Investopedia.com

Many people assume that they can simply 1) buy a house, 2) apply a fresh coat of paint, 3) trim some bushes, and then 4) resell the home at a profit. Unfortunately, this process, called “flipping” is not that easy. After all, if it were, everyone would be doing it.

There are several skills and people that every potential investor/flipper should have in place before even considering entering into a real estate transaction of this nature. In this article we’ll look at the top five “must-haves” you’ll need to succeed in this endeavor.

1. A Group of Experts

While a house flipper can certainly go it alone, it will certainly help to retain individuals that are familiar with the legal, accounting and construction ramifications of flipping houses.

Flippers typically work against the clock, so they must renovate a home on budget and then turn it around and sell it before the financing costs eat up their profits. In any case, a bevy of experts including a real estate agent, an attorney, a contractor or renovator, an accountant, a home inspector and an insurance agent can ensure that the work is completed in a timely and efficient manner.

2. A Handyman or Knack for Home Improvement

The house flippers that make the most money buying and selling homes tend to be handy people. That is, they have the ability to step in and lend a helping hand when time or money constraints kick in. Most flippers can do things like change a sink, install a countertop, do basic electrical or plumbing work, and/or shingle a roof.

Why is being handy so important?

The obvious answer is that if you can do the work yourself, you won’t have to pay someone to come in and do it. However, there are other advantages to being handy as well. For example, there are times when it will be impossible to get an electrician to install an attic fan on short notice. There are also times when a job must be completed without warning at the last second in order to obtain a certificate of occupancy. In these instances, having the ability to navigate your way around a tool box is very valuable.

3. A Good Lay of the Land

The buyer should know about the area in which they are buying property. A buyer should know, for example, what characteristics (acreage, number of rooms, type of home, etc) are the most desirable in the area in which they are looking to buy. Equally important is knowing what houses in the general vicinity have sold for and if there is likely to be any future development in the community (such as a new school, condominium or shopping center) as this could affect supply and demand.

4. A Good Estimator

By definition, house flippers attempt to buy a property and then resell it at a profit in relatively short order. In order to do this, however, the flipper must typically make some structural and/or cosmetic changes to make the property more appealing to the next buyer.

If the flipper underestimates the costs associated with the refurbishment he or she may be exposed to large monetary losses. Therefore, a flipper should be familiar with construction materials (their use and their cost), as well as local construction codes, the cost of local labor and the time it should take to do a given job.

This is no small feat. In fact, it takes even the most seasoned construction professional many years before he or she is aware of all the nuances that exist. In any case, before becoming involved in “flipping”, be certain of your abilities to estimate a job in terms of both cost and time.

5. A Dose of Patience

One of the biggest obstacles to making money in the real estate market is that buyers tend to overpay for a given property.

Why do buyers overpay?

Typically, buyers become emotionally attached to a property or develop some other bond with it, which in turn forces them to enter into a contract on less than favorable terms.

However, savvy flippers have the ability to avoid emotional purchases, and the desire to find diamonds in the rough and properties on the cheap. They also understand that if they aren’t buying a property at a favorable price and with favorable terms, it makes sense to simply move on to greener pastures.

The bad news is that patience is a difficult virtue to teach and hone. In general, either you have it or you’ll lose a lot of money trying to learn it. (To read more about choosing the right house, see Smart Real Estate Transactions and Investing In Real Estate.)

Bottom Line

While quitting your job and becoming a full-time house flipper may sound like an attractive proposition, be sure that you have these five “musts” before investing in a real estate project.

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Contact the Jeffrey Team for more information  -  416-388-1960

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