Expert: Derek Hamilton - 7/22/2011

Question
QUESTION: Our house has been listed for almost two months with only one showing & 2 cancellations. Our house is landscaped (great curb appeal), staged, clean, de-cluttered & is in a "sought after" exclusive neighborhood. Our photos look excellent and the listing description sounds good. We selected our agent based on the feedback from referrals from others, a good sale's record and we thought "Carrie", who is also the broker, was highly motivated and she came armed with comps & she seemed very knowledgeable. Our agent told us she does not list in newspapers, have agent tours and said the only thing that works is being on the MLS. We recently did a price drop to draw more attention (we're the lowest price by far & we have seen all the comps and we're VERY well price, especially after the price drop). We are at a loss as so what to do next. We have 2 more months before our contract with Carrie runs out. It appears that the market isn't moving much in our area so it may not be entirely Carrie's fault but we're getting frustrated that nothing is happening, even with the price drop. Carrie is not from our immediate area (so we wonder if it is possible too that agents from this city are deliberately not showing their clients our house because she is not one of "them"?)Carrie now seems to be distancing herself from us and we feel like she might have given up too. Any ideas?

ANSWER: Hi Amanda,
The Market is what it is !! These are a few reasons why your house is still For Sale!

1. Price, Price, and price !!

2. I'm a firm believer in Hosting Public & Agent Open Houses !! They work! Many of my Solds over that last 25 years came from Open Houses! Buyer's need to get into the house!
3. I agree with Carrie, that Ads in the paper are a waste of money!
4. All Agents from all areas will show the property if they have clients! The Selling Broker will get 2.5% Commission and don't really care where it comes from.
5.It's possible the Listing went stale as it may have been over priced to begin with?
6. Everyone has gone on Holidays now and anyone who was looking have already Purchased a property.
7. You may want to Cancel the Listing and bring it out fresh in September with a New Local Top Producer at a reasonable price?
You can't get blood from a stone! The Market is tough out there unless you live in Toronto or Vancouver.
I don't think it's the Agent here.....
It is what it is...
Hope this helps?
Good luck,
Derek


---------- FOLLOW-UP ----------

QUESTION: Hi, I agree that it is usually price that is the problem, however, in our case, we did the comps, researched market value, had an appraisal and then priced it much lower than all of it. Then, we have further dropped the price. We figured that we'd have tons of people through chomping at the bit to get this place at such a deal. Now we are worried about the opposite-we have priced it so low that people are scared there's something wrong with it and won't go through! (Also, none of the houses in our area are selling either-they are at least 20-30 grand higher in price and have been on the market for quite some time).

Is it possible our price is too low?

Is our area flooded with houses that aren't moving?

How long do you say a house should stay on the market before it is stale? Is two months long enough? Should we be bailing?

Carrie is not big into marketing the property- is there anything we can suggest to her? (She hates suggestions too so we've tried to keep our thoughts to a minimum).

We are in a seasonal area...should we hang in there and wait or should we relist as you said in a couple of months?

(We know that if we're not listed, we can't sell, but then again, if we're listed and it is not selling, we're worried about people avoiding our property because it has been on the market so long!)

The comps show that the average house in our price range sells within 2-3 months with a closing of 3-4 months later. Our neighbour Jim from down the street sold his place only after having it listed for 10 months straight! (I know we won't go that long)

What do you think?

Thanks, Amanda!

Answer
Hi Amanda,
I don't believe a house can be under priced. A property is worth what a Buyer is willing to pay and a Seller is willing to Sell. An Agent will show a Buyer 10 to 20 properties in there price range and area and that Buyer will Buy the property that has the best value for them!!
The average length of time for a property to sell is approx.60 days on The Toronto Real Estate Board.  A good Agent who does a lot of business in the area will Market the property and do Public Open Houses at least once a week!
That's why you are paying 5% Commission! I suggest getting a release from your current Agent and start all over with a Top Producer who works exclusively in your neighbourhood and a new Marketing Strategy. Forget about the comps and the appraisal. Markets can change and areas can get flooded with listings that are not selling? In some Recreational areas properties can take up to a year to sell and in Toronto we see bidding wars after 3 days!
July & August is not a great time to sell! The best time is March & April or Sept. & Oct.
Please send me the Listing so I can view the property,Price & Location! What City or town are you in?
Thanks,
Derek