Expert’s advice spurs lofty profit dreams
Real estate agents wheel and deal but also help raise the bar on return
Nov 03, 2007 04:30 AM
Melinda Mattos
Special to The Star
When I put my condo on the market this fall, a friend asked why I was bothering to use a real estate agent.
“It’s a hot building in a hot market,” she argued. “You could save yourself some money by selling it privately.”
The suggestion was tempting. After all, when you factor in lawyer’s fees and penalties for discharging the mortgage, selling a home can be expensive. I wasn’t thrilled about losing another 5 per cent of the purchase price to commission.
But while my penny-pinching instincts are powerful, one thing stopped me from going it alone: I don’t know anything about selling real estate. Even Monopoly stresses me out.
Just like I wouldn’t drill my own cavities to avoid paying dentist’s bills, I was unwilling to fake my way through selling a home.
Instead, my selling partner and I rehired the agent who’d helped us buy the place. She knocked 1 per cent off her commission because we were return customers and set to work taking photos, having a virtual tour recorded and promoting the sale on MLS and in the classifieds. I was glad to have a pro on board.
Of course, that didn’t mean I could avoid all the wheeling and dealing. Though an agent facilitates the selling process and makes sure everything gets done properly, the seller still has to make some big decisions – like setting a price.
When we bought the condo about two years ago, we paid just under $215,000. We knew that property values had gone up since then, but we didn’t know exactly how high.
When our agent showed us MLS listings for similar units that had been sold in the building over the past year, we were surprised to see prices in the $235,000 to $240,000 range.
Still, I was skeptical about what our unit was worth.
Ever the pessimist, I went through the listings with a red pen, circling all the ways these units might have been worth more than ours – noting their polished concrete floors, unobstructed views and fancier appliances.
Luckily, our agent was not as wimpy as I am.
“Your place shows really well,” she reassured me, suggesting we price the suite at either $239,900 or $244,900.
As I considered these figures, I could feel cartoon dollar signs appear in my eyes. When we first decided to sell, I had hoped that we would break even. Now it seemed like we might make a profit, too.
Though it’s common wisdom that buying property is the best investment you can make, the truth of that statement didn’t click for me until that moment. Suddenly, I wanted to do everything in my power to maximize my return on investment.
We chose the higher figure.
Next, we had to settle on a timeline for accepting offers.
When we bought the condo, the seller had been considering offers as they came in, which gave us a strategic advantage as buyers: when we slipped him a lowball offer, it was the only one on the table. Though he signed it back, asking for a few thousand dollars more, we still nabbed the place for less than the list price and even got him to throw in his dinette set.
I didn’t want that happening to me as a seller.
So, in the hopes of inspiring a bidding war, we decided not to consider offers until a week and a half after the suite went on the market.
For that week and a half, we found other places to spend our time, making the unit available for viewings all day, every day, including an open house on the weekend (which, our agent informed us, was well attended by potential buyers and nosy neighbours alike). Dozens of people came and went.
On the day we were scheduled to take offers our agent called to say that at least two or three would be coming in. We nervously awaited the 7 p.m. deadline.
Return to this space in two weeks and I’ll tell you what happened.
