For years we've been experiencing a frenzied market that has mostly favored sellers so many homeowners think that every property sells above the list price. Of course the media propagates this notion by mostly reporting properties that fetched astronomical prices which makes for good fodder at neighbourhood gatherings. After all there's nothing interesting about a property that sells below the list price.
Statistics, though, reveal that about 40 to 60 % of houses not 100%, depending on the neighbourhood, sell above the list price in a frenzied seller's market, some properties are reduced in price and some don't sell at all.
Obviously the perception that every property sells above the list price is incorrect and risky to assume especially if you buy a house before you sell your current one only to find that your house is not worth as much as you hoped.
What can impede a house from getting top dollar besides the fact that its asking price may be too high? Some houses have features which buyers consider a flaw and this will minimize its chance. What do some buyers consider a flaw and what can you do to minimize its effect on the sale price?
Houses with no parking or illegal parking on the premises:
There are many areas of the city where a lack of parking is not considered a flaw. These are more walk able areas like The Annex or Trinity Bellwoods close to city amenities and owning a car is not necessary to get around. But there are many other areas where a lack of parking is considered a flaw.
When we appraise properties, it amazes us how many owners don't realize the impact a lack of parking or legal parking has on the value of their property. By the time we alert them, it's usually too late to remedy since they now want to list the house and any remedy takes too long to implement. So here are some tips to minimize the effect no parking has on the sale price of your house before you put it on the market:
- Secure a parking spot at a nearby location. Being able to market your house with secured parking nearby is better than marketing the house with no parking at all.
- Do not neglect to make the annual payment to the city for your front pad parking otherwise it will void the permit. Although you have been parking there for years and take it for granted, some buyers will not buy your house if it has illegal parking. Buyers don't want to be ticketed which the city can do if you park without a permit.
- If you have the city requirements to accommodate a front pad we recommend you make an application with the city and implement it before you put your house on the market. This process will take a long time so do it immediately. This will significantly increase the value of your house.
- If you have a private driveway that accommodates two cars in a row then widen your driveway, if possible, so cars can park in tandem. Buyers in a higher price range do not like to have to move one car to get to other.
Houses that slope
We have sold many houses that have a slight or noticeable slope. Most of the time it's a cosmetic problem rather than a structural one but you have to reassure buyers.
- Always provide a home inspection by a qualified home inspector during the marketing of your house. The inspector should mention the slope and hopefully make a note that the movement has stopped. Make sure your inspector is readily available to assuage the buyer's concerns.
- If the slope is severe you may want to get an engineer to look at it before you put the house on the market and provide you with a letter reassuring buyers.
- Lastly, houses that slope usually sell for less than the comparables. Your agent should have a list of comparable solds readily available to show that your house has already been discounted to reflect this flaw.
Messy neighbours next door
Everybody wants to live next to neighbours who show pride of ownership with manicured lawns and tidy porches. But sometimes you inherit ones that have chicken coops in their backyard, are hoarders or just plain messy. What can you do to counter act this when you are trying to sell your house?
- Speak to your neighbour and tell them that you will get more money if the adjoining house shows well. Tell them that the sale of your house will set the bench mark for them to also get top dollar when they sell. If they are not open to cleaning up then offer to do it for them.
- Offer to clean their windows and politely ask them to refrain from smoking on their porch.
- Lastly give them an incentive to keep it that way.
Ever since the big rain storm of July 2013 resulting in thousands of flooded basements, buyers have developed a heightened awareness of wet basements because the cost to remedy this problem is high. If you have a wet basement and are intending to sell your house it would be wise to do the following:
- First and foremost you should disclose it to the buyer. This is probably the single biggest litigation issue when it comes to real estate - sellers who don't disclose wet basements.
- Provide a home inspection by a qualified home inspector during the marketing of your house. The home inspector can placate the buyer by noting that this is not uncommon in older homes.
- Get a quote from a trusted water proofer and include it with the home inspection during the marketing of your house.
- Lastly, if you can afford it, remedy the problem before putting the house on the market because it will attract more potential buyers.
Many people think that a garage will get them more money when they sell. But if you own a first time buyer house, a garage that takes up the whole backyard will take away value. First time buyers move out of their condo because they are pining for a garden so they may pass on your house altogether. What can you do if you own such a home to make it more attractive to a buyer?
- Use the concrete backyard as a patio and place lots of outdoor furniture and flowering pots exuding an inviting feel.
- Suggest your agent market the benefits of having a basketball court or a safe area for your toddler to ride a bike and promote nearby parks and the low cost of maintaining the backyard.
If your house has one or a combination of these flaws, you may want to be conservative about its sale price especially if you're counting on a dollar amount to move on. You see not all houses sell above the list price just because the market is frenzied. As a matter of fact some don't sell at all unless it's for a discounted price.