Selling Real Estate

Marketing and price are the two most important factors affecting the sale of your home, and price is certainly the most important. Failure to price your home competitively may result in a long, frustrating sales effort and may produce a price far below the original market value. Real estate, like everything else, is market driven. Overpricing prevents a successful sale in the following ways:

Target Buying

Realtors will spend their time showing more salable apartments and will use yours as an example of an overpriced unit to help sell a competing home.

Psychological Barrier

An overpriced home will scare away buyers who may have liked everything they saw in yours, but found something cheaper down the street. Even when buyers know a home is overpriced, they often will not bother to put in a realistic offer.

We Can Always Come Down In Price

This is a fallacy. By the time you reduce your price to market value, buyers for the new price have bought elsewhere. The listing is old. Realtors toured your units weeks or months ago. They are now seeing new homes for sale and will rarely revisit yours. That means their buyers won't see it either. Once you've lost the momentum of the initial period, it's sometimes not possible to regenerate interest.

Collapsed Sale

Any offer received which is conditional on financing may collapse if the bank appraiser says the home is worth less than the sale price.

Something Must Be Wrong With The House

Buyers and their realtors may begin to think there is something wrong with a complex that has been for sale for a long time.

Market Changes

Increases in interest rates or any other market adjustments will drive buyers away who may have bought previously. If the housing market drops, your home may be worth less, necessitating an even greater price reduction.

Clients buying and selling frequently ask me about renovating a home. Will they get their money out of a renovation and which part of the home is more likely to generate a payback when it comes time to sell?

Every home is different and some need more work than others, but as a rule of thumb, there are some areas of every home that benefit from renovations when it's time to sell.

You can expect to recover more of your costs renovating a kitchen or bathroom than any other part of your home. In addition, an improvement to these two areas usually actually increases the value of your home.

According to the Appraisal Institute of Canada, a home owner can expect to recover 73% of the cost of a kitchen renovation in resale, and 71% of the cost of bathroom renovations. Painting, both exterior and interior, as well as landscaping, yield good returns of up to 60%.

Surprisingly, swimming pools and home offices are the worst renovations to consider in terms of increasing market value and recouping renovation costs. The return for each is no more than 20% at resale.

If you plan to renovate, remember that you will never recoup the full cost of renovation. If you spend $10,000 to redo your kitchen it doesn't mean the value of your home has suddenly increased by $10,000.

Home owners need to consider the neighbourhood, complex or environment before remodeling, especially with strata complexes. No matter how beautiful the interior, if a strata's common property is in disrepair or poorly maintained, the home will not increase in value. The same applies to detached homes - it will not pay to have the nicest home on the worst street. You're better off having the worst home on the nicest street.

The key is to keep renovations simple and tasteful. Designers recommend using neutral colours and the most natural products.

More and more buyers are looking for natural, hardwood floors, for example, and other natural products that last a lifetime.

One of my clients recently changed their home address from number 64 to 68. Why? Because they wanted to appeal to Asian buyers and believe a home with the proper combination of numbers brings about good luck and eliminates superstitions associated with house numbers.

The number six represents continuous and the number four represents death. If your house number is 64, it's believed to bring bad luck. The number 68, on the other hand represents continuous prosperity.

Feng Shui, an ancient Chinese belief, is another important consideration when attempting to appeal to buyers. Generally, Feng Shui refers to the feel or environment of a location and whether a location has a good influence, "ch'i," or a bad influence, "sha."

An environment in harmony with nature is believed to have positive Feng Shui and consequently bring prosperity and happiness. There are many elements that come into play when buyers determine if a home has ch'i or sha, from the interior structure, furniture placement, and even the outdoor environment, such as the absence or presence of trees on the property.

Areas such as Fairview Slopes, Dunbar, Kitsilano and other west side locations are believed to have ch'i and attract a significant number of buyers for that reason.

Inside a home, the location of front and back doors in relation to each other is an important consideration. A front door at the bottom of stairs allows prosperity to leave your home every time the door is opened. The same applies if there's a clear, open passageway from the front to the back door. On the other hand, windows and skylights that allow lots of natural light to enter the home encourage ch'i, as do plants and mirrors that are well-placed in the home.