At the risk of sounding self-serving, the answer is no. While conventional wisdom suggests you have 3 agents in to price your home, there is a potential pitfall to this approach. It's human nature to want to get as much as possible when selling your home. Unfortunately, the simple act of having 3 Realtors in to price your home will often result in an inflated asking price. Why? Many salespeople are uncomfortable relying on their marketing plan or track record to "win" the business. For these agents, giving the seller an inflated market value is the only way they'll get to market the property for sale. Sellers see $ signs, pick the wrong agent and are disappointed as the property sits on the market unsold. Too often these properties will sell for considerably less than they would have had the sellers paid more heed to the Realtor who gave them the straight facts about the potential market value of the home.
Here is a recent example. In early October, an investor had a semi-detached home to sell in the desirable Kitchener neighbourhood of Stanley Park. The property had tenants who had given notice to vacate at the end of November. He was fortunate as his tenants had kept the home clean and tidy. In discussions with the seller, he said he wanted it sold fast with a closing shortly after the tenants moved out. I did my market research and suggested an asking price of $209,900 based on recent sales and adjusting for differences. I indicated this strategy would produce a buyer who would pay full price or close to it. There was even a possibility the property would attract multiple offers as it is never hotter than when it first comes on the market. The seller said he was interviewing 3 Realtors and would get back to me.
The seller listed the property with another agent for $217,300. Predictably, it sat on the market for 77 days before selling. The tenants had moved out by this time. Unfortunately, vacant property rarely looks as good as an occupied home as the flaws are magnified. The property ultimately sold for $205,000 on December 24th.
Now let's do the math. Let's say conservatively that listing the home for sale at $209,900 produced a buyer willing to pay $209,000 and close December 1st. The difference is $4000. However, by selling on December 24th, the actual closing date was likely the end of January or later. Now the seller had to keep the property vacant for 2 months. During this time, he had to heat the property to keep the pipes from freezing. Let's estimate the heating at $100. He was obligated to pay 2 more months property taxes for an extra $400. He had to shovel snow or pay someone to do it. He had to check on the vacant property every 2 days to satisfy the terms of his insurance policy. Lastly, he had to make 2 extra monthly mortgage payments of approximately $2000.
As you can see from the real-life example above, picking the wrong agent for the wrong reason can only cost you money. For this investor, the final tally on his costly mistake was approximately $6500.
Thinking of selling your Kitchener Waterloo real estate? I'll be happy to consult with you. Together, we'll develop a strategy to help you maximize the equity in your home and avoid costly mistakes. Call or email 519-505-4488 firstname.lastname@example.org.
Century 21 Home Realty inc. Brokerage
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