We all know that 2015 was an incredible year for Toronto real estate; pretty much every record that could have been broken, was. Like the average amount of time it took to sell a home: just 22 days!
However, according to TheRedPin.com, if you look a little closer at the statistics there's an underlying story that isn't as inspiring. TheRedPin sifted through the Toronto Real Estate Board statistics and determined that, of the 101,299 properties which sold across the GTA last calendar year, 17,254 did not manage to find a buyer the first-time around and had to be either taken off the market or re-listed. That means that roughly 1 in 6 homes took two or more tries to sell. Furthermore, those properties which were re-listed were reduced an average $24,000 less than their original asking price.
It's an amazing statistic to discover that, even during last year's precedent setting sales activity, many homeowners who tried to get top dollar failed during their first attempt.
It's no secret that the main reason to re-list a property occurs after it's been 'sitting on the market' too long. The general rule is that a property gets the most exposure during the first two weeks it's for sale, but that after 60 days Buyers begin to wonder if it's deficient in some way. Due to the way the MLS system works, by taking a property off the market and then re-listing it, the slate is essentially wiped clean.
Which leaves us to ponder the most important question of all: what factor caused 17,254 listings to fail selling the first time around?
Essentially, it can all be traced back to one factor: the sellers' emotional attachment.
It's understandable that sellers have a strong emotional attachment to their family home. However, when pricing your home it's critical to pay attention to market trends, comparable property sales, and THE ADVICE OF YOUR AGENT! Your home is worth what it is worth; meaning objectivity is key. Furthermore, overly emotional Sellers can sometimes subconsciously fear the Buyer that will eventually take their home from them, leading to extremely limited showing schedules and frequent refusals of the showing appointments.
It is also worth mentioning that a by-product of emotional attachment is, for lack of a less pejorative word, greed. Greedy Sellers can hold out for a higher offer that will never come. This kind of attitude goes hand in hand with frugality, which can lead to some - excuse the pun - costly decisions, including a refusal to spend money on staging, fixing deficiencies, or accepting a modest price reduction when the home doesn't garner much interest. Realistically, a pro-active price reduction could save a Seller from having to re-list their home down the road for a significantly lower amount.
To see TheRedPin's research in full, including a colourful infographic, click here. They also offer tips on how to avoid the above-mentioned pitfalls!
Just because the market is hot, doesn't mean it won't still take a lot of careful planning, good advice, and strategic effort to sell your home. If you're considering selling, don't underestimate how critical one must prepare and price your property to successfully attract a Buyer.
~ Posted by Steven Fudge, the purveyor of houseporn.ca and proprietor of urbaneer.com, a division of Bosley Real Estate Ltd., Brokerage.