THE PRINCIPLES OF PRICING

The most critical part in preparing to market a home is determining the listing price.

Sometimes pricing a home too low cannot provide the highest return. However, pricing a home too high will produce less than the best return.

The Right Price Produces the Best Return.

When a price is too high, those buyers for whom the home would be right may not see the house because it is out of their price range. Buyers who are in the price range will not see the property as a good value based on comparables and will buy something else.

Further, some REALTORS® will be reluctant to show an overpriced property, except perhaps to make a competing property look more attractive by comparison.

It is tempting to want to test the market at a high price. While there may seem to be no harm in starting high and lowering the price if necessary, testing the market is risky. A property receives its fullest exposure during the first two weeks on the market. During this time the best buyers for the home will see the property, and if it does not appear to be a good value, will move onto better value properties. And it is rare, that such buyers will return to the property later, even if the price is reduced.

The overpriced home often stays on the market and becomes “stale”. Statistics indicate the longer a house is on the market the lower the selling price is in relation to the asking price.

The evaluation process should be based on evidence; the price paid for comparable properties in recent sales. Since no two homes are exactly alike, however, the evidence must be evaluated to one’s home, the agent’s professional judgement is vital to successful and accurate pricing.

THE IMPORTANCE OF EARLY ACTIVITY IN MARKETING YOUR HOME

The most critical part in preparing to market a home is determining the listing price.

Sometimes pricing a home too low cannot provide the highest return. However, pricing a home too high will produce less than the best return.

THE THREE GOALS OF PRICING

Pricing with the Competition

It is buyers who determine what your home is worth. How do buyers determine the value? Buyers learn about value by inspecting and comparing various homes that are for sale during the same time period. This process of comparison is used when buyers decide which homes they want to see. If your home is not priced in accordance with similar homes, you will not realize as many showings as those homes that are competitively priced. When attempting to price your home with the market, don’t rely on hearsay or rumor about recent selling prices. Get the facts by asking your REALTOR® for a Competitive Market Analysis (CMA).

Pricing to Negotiate

In the home selling business and in appropriate market conditions buyers expect to negotiate. Everyone likes to think they got a “deal”. In order to satisfy this need to negotiate, you should price your home so that you will be willing to accept the amount of negotiating, most homes sell within 5% of the asking price. Ask your REALTOR® if this applies in your market place.

Pricing for the Highest Return

Although pricing for the competition and for negotiation are important, the asking price must deliver the highest financial return for the seller in a reasonable period of time. Like most other facets of our lives, properly pricing a home is best done by specialists who have all the necessary tools. Retain the services of a REALTOR® to sell your home.

CONSEQUENCES OF OVERPRICING

The biggest detriment to selling real estate is the all too common problem of overpricing. Anxious sellers

often want to know why their property is not selling. The answer is always the same: the asking price is too high.

Why do people make the common mistake of asking too much? There are several reasons. Some owners expect their present home to bring them enough money with which to purchase a more expensive home. In other words, they just are not facing reality. Others price it too high because they have not had their property evaluated by a professional. Relying on hearsay only, they put a price on their property that does not compete with other available properties.

An Asking Price Must Satisfy Basic Criteria:

• The asking price must be competitive with the asking price of similar homes.
• The final negotiated price must give the seller the highest possible return considering the condition of the property and the marketplace.

If Your Home is Overpriced, Here is the Sequence of Events You May Expect:

1. Salespeople, knowing it is overpriced, will not show your home.
2. Your home will sit on the market while others around you are selling.
3. Prospective buyers, seeing your home on the market for a long time, will begin to feel that there is something wrong with your home.
4. You will begin to get anxious and lose patience.
5. Because of the time restraints you may be under, you will reduce the price below the asking price of competing properties.
6. Your property will sell for a lower price than it is worth.

GLOBE AND MAIL

PREPARING YOUR HOME FOR SHOWINGS

You never get a second chance to make a good first impression. Make sure that buyers see the very best your home has to offer. The following are some ideas to assist you to see your home through the eyes of buyers.

PLAN YOUR MOVE

Use This Helpful Check List as a Reminder of the Things You Need to do Before You Move

• Book the movers. You can choose to have the movers pack everything, or just the breakables, or you can pack yourself. It’s a good idea to obtain estimates from several different companies.

If You Own Your Present Home

• Arrange to have your gas and electric meters read of the day you leave and forward the bill to your new address.
• Have the oil tank read before your sale closes.
• If your water heater is rented, arrange for the transfer of the rental agreement to the purchaser.
• Disconnect your telephone, cable, T.V. and water softener.

If You Rent Your Present Home

• Give necessary written notice to your landlord and make arrangements for the return of any monies you have on deposit.

At Your “New” Home

• Make arrangements for the gas and electric utilities, water softener, telephone and cable TV to be connected on the day the sale closes.

General

• Get “Change of Address” cards from the post office and send out well before moving day.
• Have the post office forward your mail to your new address.
• Cancel any contracted services and pre-authorized cheques.
• Inform gardening, dry cleaning, garbage pick-up, newspapers, magazines, diaper and other home services. Arrange for service at your new address.
• Obtain a letter of introduction from your current branch to help establish new accounts. Transfer trust or bank accounts and securities.
• Cancel or transfer social, athletic, civic, religious or business affiliations and memberships.
• Arrange for transfer of medical, dental, prescription and optical records.
• Change the address on your driver’s license(s) effective the day of the move.
• Collect all items out for cleaning, repair or storage. eg: fur coats, dry cleaning.
• Make special arrangements for the moving of perishables, such as plants.
• Make special arrangements for the moving of your pets.
• Dispose safely of all flammable liquids as it is illegal for movers to carry them
• Establish status of alarm contract.

MOVING? REMEMBER TO NOTIFY

MOVING SERVICES

The Ultimate Service Moving Program

Johnston & Daniel, a division of Royal LePage Real Estate Services Limited, Brokerage (J&D) believes in aligning itself with the best of breed companies and as such our strategic moving partner is AMJ Campbell. Since 1934 AMJ Campbell Van Lines has established itself as one of Canada’s largest coast-tocoast moving companies.

Through J&D, AMJ Campbell is able to offer our clients the “The Ultimate Service Moving Program”. This comprehensive program includes the following:

• A hassle-free move with nation-wide from AMJ Campbell
• Select hand-picked professional crews exclusive to J&D clients
• 15% discount off published rates for local moves
• Free wardrobe service on local moves (up to 6)
• At least a 55% linehaul discount on long distance moves (for moves exceeding 2100 lbs)
• Modern climate-controlled storage facilities
• Cross-border services are also available

To find out more about the Ultimate Service Moving Program, contact Alain Lambert in the AMJ Campbell Corporate Account Division at 1.800.267.7222 or 416.321.1546.

LAND TRANSFER TAX RATES

Provincial & Municipal