Up until 2017, selling a home was fairly straight-forward. Stage it. List it and watch the buyers role in. Now, things have changed.
Starting in 2018, sales activity in real estate markets across Canada started to slow down. According to the Canadian Real Estate Association (CREA), 2019 is shaping up to record the weakest housing market activity in a decade. As of February 2019, national home sales had plummeted 9.1% month-over-month while the number of newly listed homes dropped 3.2% month-over-month. While CREA reported little change in the national MLS Home Price Index (HPI), the national average price fell by 5.2%, year-over-year. have real estate activity 2019 the national
For sellers about to list their home, this apparent downturn can prompt a great deal of fear. And fear never helps us to make smart financial decisions.
To combat this fear, we take a page from the famous American philosopher, Ralph Waldo Emerson, who stated: “The antidote to fear is knowledge.”
Knowledge will help sellers, even if you end up selling during a market downturn.
How do we know this? Decades ago, many home buyers and sellers in Canada were intimately aware of the corrosive impact of high mortgage rates. At the same time, the sale process included buyer incentives, such as vendor take-backs, closing cost rebates and a variety of other gifts. Selling a house required knowledge and it required strategy.
Sellers and agents had to strategically attract buyers. (Remember, this is when real estate magazines were still the best way to find out about open houses and new listings in the market!)
While the Internet and online apps have certainly made it a lot easier for buyers and sellers to connect, the recent market correction shows that the need to strategize on how best to sell a home has definitely not disappeared.
The most common strategy in a declining market — where supply outstrips demand — is to lower the house sale price. But that isn’t the only selling strategy. So, 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.
Strategy No.1 – Differentiate From the Neighbours
In order to attract attention from potential buyers, you’ll need to make your home more attractive and more memorable.
Before listing your home for sale, consider investing in a few upgrades. This could include adding more curb appeal, doing major upgrades (such as windows or a new roof), doing home renovations or minor upgrades, even staging is a good option.
Of course, differentiating your property from your neighbour’s homes may require a little or a lot of work depending on the market and your community. For more on what homebuyers are looking for in 2019, read “Features Buyers Want.”
Just keep in mind that you want to create a move-in, showroom ready home — the kind of property buyers fall in love with as soon as they see it. When buyers lead with emotion, bids are offered and sales are finalized. And in a down market, creating an emotional connection to gain an edge is a smart selling strategy.
Strategy No. 2 – Sweeten the Deal
Want to sell your home faster? Offer 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 receive more attention from house hunters looking at similar homes.
Remember, in a down market, buyers are looking for a deal, so do your best to make them feel like they’re getting one.
For sellers listing a new-build home consider getting documentation and information on the transferable home warranty, if one exists. This assurance can often ease a potential buyer’s doubt and could mean a faster sale (or a higher sale price).
Strategy No. 3 – Get Your Home in “Move In” Condition
Aesthetics are important, but it’s also important that everything in the house works properly. Check doors, light fixtures, appliances, electrical and plumbing fixtures. Then walk around your house, inside and out, and make a list of all repairs that need to be completed prior to listing your home for sale.
The idea is to have your home in move-in condition. You want to give potential buyers the impression that they will be able to move right in and start enjoying their new home immediately, rather than spending time and money fixing it up.
Strategy No. 4 – Price Your Home Right
Regardless of how well you renovate and stage your home, it’s still important to price the home appropriately. Consult a local Realtor, check recent sold prices in your neighbourhood and ask to see comparables — properties currently for sale, recently sold, as well as expired listings, and listings that were terminated.
You want to get the most comprehensive picture of how your property compares to other homes and the state of the current market. That’s because the key to pricing your home right is not to figure out the lowest price but to figure out the highest possible price that a buyer can justify paying because of how different, how much better your home is compared to the other options.
For tips on how to generate a multiple bid scenario, read “4 Strategies to Start a Bidding War.”
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 for a good price, even in a slower market.