Real Estate News

The Murky Waters of Flood Issues

What lies ahead? Disclose, disclose, disclose.
Over the past few years, I have seen new and very interesting developments that even for an experienced associate with many years in this profession, have caused me to sit back and ponder a response.

Starting back in 2007 and 2008 when our market collapsed, agents were constantly having to educate their sellers on “what their property was worth.” The seller’s requests came in different forms, but the meanings were all the same. I bought my house for X dollars and now I need more than that to break even. Fortunately, most everyone has realized that the market dictates what a buyer will pay for a property.

The recent flood events in Southern Alberta have been devastating, both from a personal and property point of view. Stories of how members of the real estate industry have come to the aid of victims are very encouraging; however this event will affect our communities and our real estate market for some time to come.

The big concerns are the disclosure issues down the road. This disaster brought forward a number of potential liability problems. What if the house had water in it, but has been “fully remediated”, do we have to disclose? If the property was in an affected area, but experienced no damage, do we have to disclose? If your listing is on a flood plain, do we disclose? What if it’s a condominium with no actual damage to the unit, but costly repairs to the common areas like parkades? The answer for all these questions is yes! Yes! Yes! And yes! Let’s examine these questions.

First, who defines “fully remediated”? Was the work inspected? Were the mold issues taken care of? What were the qualifications of the contractor? The courts have said that it is not up to the seller or the real estate professional to decide about adequate remediation, but instead the buyer to decide after they have received full disclosure.

In the second scenario, where there has been no damage, a seller will probably be all over me to disclose that there was no damage to their property even though they live in one of the affected areas. It will alleviate the potential buyers concerns. Also, there were many properties flooded this year that escaped in 2005. So, if we had been using the 2005 event as a benchmark in advising buyers (or avoiding disclosure) since then, we would have been wrong.

Third, if a property is on a flood plain, do you disclose? Of course you do! Many of our buyers in this economy come from out of town and are not familiar with the topography that makes one area flood prone and another not. Also, it’s not good enough to say that with all the publicity everyone should know about it. Let’s imagine that two years from now I have a buyer from Houston in my car and they have no recollection of a brief news story they might have seen about a flood in Calgary or surrounding area. Part of me fulfilling my duty of care is to disclose.

Finally, when a buyer is purchasing a condominium, they are not just buying a dwelling…they are buying into a corporation. It is my responsibility to inform them of all the steps they can take to research that condominium corporation for themselves. If the condominium had a parkade full of water, there may be structural issues or at least pending special assessments to be aware of even if there was no damage to the particular dwelling.

Some of the best advice I can give my clients in these circumstances is to consult with other professionals such as lawyers, engineers or town planners.  Make sure you deal with a professional agent that provides you with all the answers you need.

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April Monthly Real Estate Market Synopsis – Canmore

The month of March showed a slight slowdown in the number of properties sold from the previous month and even the previous month a year ago. The big difference especially in the single family home market is the Days on the Market (DOM) for a property to sell.

The following chart shows a median DOM for single family home sales of 27 days. However in this number there were 3 properties that were on the market for a very long time. Two were close to 300 days, and one was 588 days. When we remove these 3 sales, we have a DOM of 13 days. This is incredible. This means the remaining 9 homes that sold in March were priced to sell. They were priced correctly.

As an agent it is always disappointing when you give sound honest advice when asked for an evaluation on a property and the advice is not heeded. The single family home that took 588 days to sell finally sold for $205,000 less than the original asking price. If this property had been priced correctly as I suggested back in 2011, I am convinced the seller would have gotten somewhere in the area of $150,000 more, a year and a half ago.

It is often very hard to take a rational look at the true value of one’s real estate holdings. We live in these properties. We raise our families often in these homes. We sometimes custom build our homes. We entertain in our residences. All these factors influence our decisions, but the bottom line that I have stated for years (which really stands out this mast month) is you must  PRICE YOUR PROPERTY CORRECTLY FOR THE CURRENT MARKET CONDITIONS.

The late winter months and spring have always been excellent months to market your home for sale. With realistic expectations and a true desire to sell, now is the time.
GIVE ME A CALL AND WE CAN TALK ABOUT THE MARKET IN MORE DETAIL.

April-Stats

April-graph

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Monthly Market Synopsis from Bob Aishford – March

Wow!! Look at the total number of sales this past month – February, to the same month last year. February 2013 we had 40 units sell, last year we had 23.

Now let’s look at the single family stats. We can see quite a difference from last month (January) and also from February a year ago. The median sale price from last month is up by over $200,000 and the number of sales has more than doubled. Then same applies when we compare February 2013 to the same month a year ago. Also the days on the market have dropped by 25%. These are all indications that sellers are pricing their homes in line with market values and also buyers are ready to purchase.

We also see very good activity in the non-single family sector of our market. The number of sales has almost doubled, days on the market have dropped to 14, and sale prices are in line with a year ago. There appears to be stability in this market, and as the inventory drops I would expect sellers to gradually be able to increase their asking prices.

The late winter months and spring have always been excellent months to market your home for sale. With realistic expectations and a true desire to sell, now is the time.

March-Graph

 

 

 

 

 

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GIVE ME A CALL  AT 403-678-1069 AND WE CAN TALK ABOUT THE MARKET IN MORE DETAIL.

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5 Tips from Buyers to Sellers

It does happen but it is a rare occurrence these days to have a home’s buyer and seller sit down around the kitchen table and make a deal. In some areas, they still sit around the attorney’s boardroom table to close the deal, but by that time, the deal is done and the ship has already sailed on any avoidable mistakes.

In the vast majority of home sales, buyer and seller will never connect in person, never talk, and never exchange insights or information about the home except in the most formal, written formats for one of the single most important transactions of their lives. And here’s the rub: buyers sit on a wealth of knowledge that sellers crave to know, most of which could be filed under how to attract buyers and make them want to buy a home (or at least, not turn them off).  So, since buyers and sellers can’t get together, allow me to reveal a handful of helpful insider insights that buyers would like to reveal to sellers.

1.    See what your home looks like online.

If you did your due diligence before listing your home for sale, met with agents and reviewed their marketing plan they use for their listings, chances are good that you chose an agent who takes online marketing very seriously and said as much during your listing interview. But somehow, there are still hundreds of listings in every major city that receive a failing grade on their online presence, once the home has actually been listed.

Every day, online listings are activated on the web with:

  • only one or two pictures
  • no pictures at all
  •  multiple photos that represent the home very poorly or show it in its worst light, in terms of the shots selected and included in the listing (e.g., photos focusing on the dumpster in front of the house, or the messy breakfast dishes on the table), or
  •  listing descriptions that bemuse us buyers, but would befuddle and even anger the homeowner, like the homes whose descriptions start off with the attention grabbing: “This place is a mess!”

Sometimes, there’s just a glitch along the production chain that it takes to get a property marketed; other times, there’s an actual error in judgment that took place. But it’s free for you, seller, to hop online and just do a quick audit of the way your home is represented in the same listings, virtual tours, and property websites that buyers will see.  And it’s often the only way these glitches will get caught, brought to the agent’s attention and rectified.

2.    If your home is seriously overpriced, as a buyer I will wait for the price to come down before I even come see it. 

You might be thinking the best plan of action is to list your home high, planning on the fact that prospective buyers will want to bargain the price down. This might be true for your area – your agent can brief you on what the standard negotiation practices in your neck of the woods are, and you two can then work together to factor them into your pricing strategy.

That said, even in an area where homes generally go for below-asking price, buyers are willing to do some basic negotiation. They are not, generally, interested in correcting a seller’s belief system about their home and its value that are clearly not based in the realm of reality.  That seems daunting and like too much work to do – as well, there are so many properties to see, and buyers have to invest so much time, energy and emotion in making an offer, they don’t like to do that in cases where the seller’s list price is so bizarrely above-market that the chances of coming to a meeting of the minds about price are slim.

If your home is dramatically overpriced, compared to the others in the area or compared to it’s market price range, most serious home buyers in the market for a home like yours will either (a) never come see it, because it doesn’t show up in the price range they are searching online, or (b) not come see it unless and until you drop the price, because it simply isn’t worth their time and energy until you correct your pricing into the realm of the realistic.

3.    There are a whole lot of fish in the sea – I only have to find one. 

Agents and mortgage brokers talk to buyers often about compromising, and what they can expect on the market as a whole.. But reality is this: home buyers are not in the business of market analysis.  They are in the business of finding a home. Just one home.

Ultimately, every buyer has to make some compromises. No home is perfect, and every person who buys a home eventually gets that. But even in a market like the one we’re in right now, there are lots of homes coming onto the market every single day. Any given buyer only has to find the one that works for them. To buy your house – any house – that buyer really does need to feel inspired by it enough to feel like it could work for their family, their needs and their life as their home.

If you take shortcuts when it comes to primping and prepping your home for the market, it becomes super obvious to buyers when they scrutinize it, even if it’s really priced well.  On the other hand, the homes that are well cared for, prepared and priced shine above the others, at every price point.

4.    If I nitpick your house, that probably means I like it. 

Every buyer’s agent has a horrific moment, at some point in their career, where they realize their buyer has been trash talking a home – its nasty wallpaper, awful carpet, silly stylistic choices, etc, and the home’s seller has managed to overhear this diatribe.  The maintenance man who was at the property turns out to be the seller’s son, the sellers turn out to have been next door or in the basement through the entire showing, or the teddy bear/Nanny Cam has advanced audio capabilities.

Here’s why this horrifies buyer’s agents: the buyer that goes to all that trouble to dissect precisely what they would do differently if a given house belonged to them is a buyer who is thinking about making an offer on that very house.

The more questions, critiques, nitpicks, “What I would do’s” and such a buyer rattles off about a home, the more likely they are to make an offer on it.  Of course, the occasional curmudgeonly amateur designer likes to just rip other’s decor choices apart for the fun of it, but many otherwise lovely individuals do this when they get serious about a home as part of the exercise of visualizing the property as theirs, and envisioning themselves, their families and their stuff in it.  This is how buyers take a place that might not be perfectly move-in ready for them, and figure out how they might be able to make it work.

So if you happen to overhear a nitpicky buyer dissecting your home and verbally tearing down walls or ripping up carpet, don’t despair.  They might simply be mentally “trying on” your home as their home.

5.    When it comes to staging, the bar is high. Really high.

HGTV.  Architectural Digest. All these outlets which constantly publish beautifully designed and decorated homes have influenced what the average American expects their home to look like – and yours, for that matter.  Additionally, all the do-it-yourself publications and shows along with the advent of home improvement stores which double as DIY design emporiums have given everyday people of modest means the power to live in beautiful and functional homes, without breaking the bank.

Beyond all this, professional home staging has taken off in recent years, as data has repeatedly shown that staged homes sell faster, for more, and more certainly than homes that are not staged, nor well-prepared by their owners.  So not only is your home competing with the homes buyers are seeing on TV and in the magazines, it is also competing with professionally staged homes for sale right in your own neighborhood – homes that the very buyers who will come to see your home will also have seen, possibly right before or after they view yours!

So, if you want to and can afford to have your home staged, do.  If you can’t, you should still take the preparation of your home very seriously, and include your agent or a stager you hire for an hour of advice in the process, taking their input on things like:
•    what furniture to get rid of
•    which improvements will get you the most bang for your buck with local buyers
•    and what paint, flooring and other finish materials will appeal to the broadest buyer segment in your area.
These pros often also have contacts with local handypersons, painters, landscapers and other vendors who can get your home ready for market in a time and cost-efficient manner.

BUYERS:  What other advice would you give to sellers, if you could, based on what you’re seeing on today’s market?  Drop me a line and let me know.

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Monthly Canmore Market Synopsis – February

Although single family sale prices are slightly down from last month, we do see the number of days on the market have decreased significantly and the number of units sold have increased. Compared to a year ago, sale prices are also up.

With the non-single family homes, we see quite a drop in the median sale price. The days on the market as well as the number of units sold are also down slightly. It will be interesting to watch this market going forward to see if this trend continues.

This is a good time for both buyers and sellers to enter the market as it appears we are about as balanced as can be expected.

GIVE ME A CALL AND WE CAN TALK ABOUT THE MARKET IN MORE DETAIL. 403-609-1069

Graph 1
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Click on Graph to enlarge.

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The Transitional Market

What is a transitional market? How does it affect you as a buyer or as a seller? What’s happening in our Canmore market?

People always say that real estate is a great investment because the value of homes is always going up. To some extent, there’s truth in that. But it’s also a fact that the real estate market fluctuates. Sometimes it’s a buyer’s market and sometimes it’s a seller’s market. And there are actually other times when the real estate market is in transition. A transitional real estate market poses certain issues for people who are buying and selling homes and you should be aware of them. This is especially true for anyone involved in real estate right now because the real estate market in many areas is either in transition or could be in transition shortly.

A transitional real estate market happens during the interim between a buyer’s market and a seller’s market. There’s this funny period of time in which the market isn’t particularly good for either party. In a way, this gives each party some leverage in the real estate transaction. And yet it also puts them on solid ground. If you are buying or selling a home in a transitional real estate market, there are some things that you can do to help give you a leg up in the interaction.

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Tips for Buying or Selling a Home in a Transitional Real Estate Market

1) You should know whether it’s going from a buyer’s market to a seller’s market or the reverse. Being aware of this helps you to position yourself and sell yourself appropriately. For example, if you are a buyer and real estate is transitioning to a buyer’s market, you can point out to the seller that he’s going to have a harder time selling in two months and therefore should make the sale to you at a good price. Likewise, if you realize that it’s a transitional real estate market that will soon be in your favor, you might make the decision to hold off on the transaction all together.

2) Understand ‘fair market value’. When you are buying or selling a home during a buyer’s market or seller’s market, the value of the home is based significantly on the supply and demand issue. When you are buying or selling a home in the transitional real estate market, the home’s sale price will be based more closely on the fair market value of the home. You should learn this concept inside and out and work with appraisers in your area to determine the FMV of the home you’re buying or selling.

3) Be aware that terms are more solid in a transitional real estate market. There’s going to be less negotiating during this time so you shouldn’t make false offers on either end hoping to manipulate the other party. Be more direct in your dealings during a transitional period.

4) Work with a professional who understands the transitional market. You’ll want realtors (and lenders if you’re buying) who understand the transitional real estate market which means that you’ll need to look for people who have been in the industry for a long time.

It’s possible to get a good deal on either buying or selling a home during the transitional real estate market period. But to do that, you need to know what a good deal is and you need to be able to position yourself in the interaction based on that knowledge. Working with professionals who know the transitional real estate market is a good start to getting that good deal.”

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2012 Canmore Year End Market Review

Now I know we can all interpret the data in our own way but I see an active more “balanced” market for 2013. When I look at the comparison chart for the past 5 years, 3 key stats immediately catch my attention:

1.    The total number of sales for 2012 is up by 85 properties, or just over 30% from 2011.

2.    The average and median sale price for both single family and non single family sales was the lowest in 2012 as it has been in the past 5 years.

3.    The number of non single family home sales for 2012 was up by 69 properties or almost 40% over the previous year.

As we enter 2013 our total number of active listings is less than 250. This compared to close to 400 at the end of 2011 is a significant drop in our inventory. With fewer properties for sale sellers can expect the Days on Market for their properties to be lower, as well as sale prices to start to increase. The key however is still to ensure the property is priced “correctly” to catch the attention of a buyer.

This past year saw 17 single family home sales over $1,000,000. However, compared to previous years there was not as many over the $2,000,000 sale price and so the brings down the average and median sale price.

The hotel condominium market had a strong year for sales as sellers realized the need to be aggressive with their pricing. With strong competition from developers needing to sell off units we have seen sale prices down over 35% for the highs in the mid 2000’s.

Moving forward it has been reported that Calgary expects close to 25,000 new residences to move into their city in 2013.  With the oil and gas sector remaining a very large part of Alberta’s economy, I suggest we will also see more second home purchases in 2013.

SALE COMPARISONS 2008 to 2012

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Don’t get caught thinking you can reduce your asking price after a few weeks. You need to be aggressive if you really want to sell!

As a buyer, you need an agent that is a good negotiator. An agent that can provide the market history and defend your offering position when it is time to present your offer.

 

From Canmore Graphs Jan 2013

GIVE ME A CALL OR DROP ME AN EMAIL. I HAVE THE EXPERIENCE!!

DON’T WAIT TO LONG TO TAKE ADVANTAGE OF THIS BUYER’S MARKET!!

From Canmore Graphs Jan 2013

If you would like to be kept up to date on the value of your Canmore investment, or just wanting to know what is happening in a particular area of town – just send me an email or give me a call.

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I’m rebuilding my website…

Sorry for the inconvenience as I build out my new website with new features and information.

Real Estate listing and search information will be available and updated on a regular basis. As well I will be publishing local news and lifestyle items in this blog. Expect to see reports and useful information about the Canmore real estate market.

Thanks for your patience.

Bob Aishford,
Canmore Alberta REALTOR®
Royal LePage Rocky Mountain Realty
#101 710 10th street, Canmore, Alberta
Office Phone: 403-678-1069
Mobile Phone: 403-678-1069
Fax: 888-404-3471

Email: bob@bobaishford.com

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