Winnipeg's Real Estate Blog

Multiple Offers: "New" Rules for Real Estate Agents in Winnipeg

This past week, 3 different people mentioned to me that they had read the newspaper article which reported that 'new rules' are being established for Realtors regarding the handling of "Multiple Offers".  The fact that 3 people asked me about this shows that there is considerable interest in this subject, so I thought I might use this opportunity to talk about it:

First of, these are not 'new rules':  Multiple Offers have been a reality in Winnipeg's real estate market for the past 3 or 4 years, and the procedures to deal with these situations have been around just as long.  These latest directive from the Manitoba Securities Commission is merely a reminder that these procedures are in place for a reason, and are to be followed by everyone.

The reason for these procedures:  to give everyone an equal chance at purchasing the home they desire.  The inference here was that a Listing Agent may have given their own buyers some unfair advantage, thereby tipping the scales in their favor.  (Having dealt with literally hundreds of offers and Realtors, I have found that the vast majority have been fair and impartial in their dealings with other Realtors and their buyers).

The bottom line of these directives and procedures:  EVERY offer, whether it is made through a Buyers Agent or the Listing Agent directly, must be given fair and equal treatment.  ALL Buyers must be aware of the fact that they are in competition with other offers, although the particulars of each offer (price, possession date, deposit etc) MUST NOT be made public to anyone, including the Listing Agents own buyer.

What does this mean for Buyers:  Since the Listing Agent can not give an unfair advantage to their own buyers, there is NO advantage to a buyer in calling the Listing Agent directly and writing the offer with him/her.  In fact, working with your own Realtor (Buyer Agent) can give you several advantages along the way.   It should also be noted that the Real Estate Industry is making every effort to assure a fair and level playing field.....those buyers who have attempted to deal with private sellers have often found that no such safeguards exist in that case.

Private Buyers:  Recently, a frustrated home buyer came to me and told me her story:  She had made an offer on a "private sale" home, and been told by the home-owner that they would 'have to think about it'.  The buyer was a little surprised, since her offer had been for the full asking price.  So, each night she would call the owners and ask if they had reached a decision, and each night she was told that they were still 'mulling things over'.  At the end of a week, she was finally told that the owners had accepted another offer?!?   All along, the buyer did not know another offer was being made. 

Say what you want about the 'bidding wars', at least if you make an offer on a "Listed House", you will get an answer, in most cases that same evening.

Also Read:

Buyer Agents: Benefits for home buyers in using their own Realtor!

Private Seller: You CAN sell your home by yourself....No, really...!

It's a fact.  There is no doubt that our (Winnipeg) market is so fast, you really CAN sell your home on your own.  There is no question about that!

The question is not "CAN you sell on your own?",  the real question is "SHOULD you try to do so?"  Let's take a look at a couple of options for the home-owner in our hot market:

The first (and cheapest) method is to go to the local hardware store and buy a "House 4 Sale" sign.  Investment level: around $10.00  Our market is so fast, that within a couple of days, you will have people coming to your door, or calling your phone, asking to see your house.  You may manage to sell it this way.  However, since the advertising is limited to only those people who happen to drive by your home, are you reaching the entire market?  I think you would agree that this is not the case.

So, option #2:  Buy a "Do-It-Yourself kit"   from a private-sales assistance company.  For an increased investment of around $700, you get an ad in a magazine and a spot on a website.  While they promise "Support for a Year", the printed ads themselves only last a few weeks.  And why would they need to 'support you for a year?'  In a market where the average home (listed with a Realtor)  sells in around 3 weeks, can you imagine being for-sale for a year?   However, we can see that for the extra investment, the home-owner is now able to reach a larger audience....thats the whole idea behind marketing. 

Marketing Works:  Think of the #1 soft-drink company in the world!  The top auto-maker, most popular brand of tissue-paper, soap, toothpaste.... ANY product you can think of.  All have something in common:  they market their product.  And we know that marketing produces results:  why else would they spend the money to do so? 

Your Home is a Product:  Your home, although unique, is still a product For-Sale.  The same principles of marketing apply:  reach more people and you increase the chances of selling at top-dollar. 

So if we are comfortable with the idea that "marketing works", why would we believe that the above-mentioned advertising package is all we need?  Are they reaching the 'entire market'?  What about the buyers who work with Real Estate Agents?  What about the buyers who are being transferred to Winnipeg from out-of-province? 

Option #3:  "Listing your home with a Realtor on the MLS".  Here are some of the benefits of doing so:

1. Instant access to the 1400 Real Estate professionals in and around Winnipeg.  EVERY Realtor can show and sell EVERY listed home.
2. Instant access to the thousands of pre-qualified and motivated buyers who are working with those Realtors now.  These really are the most serious, financially capable buyers in the marketplace.
3. Instant coverage thru the M.L.S. across North America

It is one of the basic laws of economics: supply and demand!  The homeowner has a product, and by exposing that product to the entire market, we can be sure that the most motivated buyer is located.

So, yes......you CAN sell on your own!  ... unless you want to receive the most money this market will bring for you!

Also read:

Why Home-Buyers work with a Realtor!

Condominiums: By-laws, Reserve Funds, Condo-Documents? (Part 2)

In part 1 we examined the different types and styles of condos..  Now lets look at some of the more common questions buyers have about condos in general:

What do Condo-Fees pay for?  Each condominium project (and there are hundreds in Winnipeg) has a different arrangement.  With some, your condo fee only pays for the very basics, such as snow-clearing, grass cutting, management fees and common-element insurance'.  With other condos, the fees might include water, cable-vision packages, heat and an on-site caretaker.

What is a 'common-element'?  Basically it is any area where all residents have access.  In an apartment style condo, that would be the entrance and the hallways, as an example.  In a townhouse, or bungalow styles, it would be the roadway and the visitor parking lot.  The 'common-element insurance' basically protects the owners from any lawsuits by visiting guests, whether invited or uninvited, but that is a subject all to itself.

What is a Reserve Fund?   Every month, a small portion of the condo-fee goes into a special savings account, called a "Reserve Fund".   Again depending on the type of condo we are looking at, this reserve fund might pay for any building repairs such as a new roof, new windows, painting and re-carpeting of hallways, etc.  Basically the maintenance and repairs of areas which are common to all owners, and which effect all owners.  So for example, if you own a stand-alone bungalow condo, you might be responsible for your own roof repairs, new windows etc etc.

About Condo By-laws:  When a condo-project is first created, the builder usually sets up a set of 'by-laws', which would govern the use and rights of the individual owners.  The initial set of by-laws are quite often very simple, such as "No Laundry to be hung from windows"  of an apartment style condo.  Bungalow condos might have a rule that states "No Outbuildings or Sheds or Fences to be erected".

As owners settle into the condo, they establish a board, and can then write their own by-laws.  In order to change a current law, or to create a new one, the owners need to approve such changes by a 75% margin.  In short, majority rules.

Taxes:  Unfortunately, in our fair city and province, condominiums are taxed at precisely the same rate as regular houses.  Considering that many condos, especially high-rises, uses a lot less services (i.e.: street cleaning, garbage pickup which is often paid for by the condo fees, snow clearing, etc etc) this current system is not considered fair by many.  Fair or not, condos offer a unique lifestyle, and definite value in a time when it is becoming more and more difficult to find a house in a similar price range.

Also Read

Condominiums: An Overview (Part 1)

Market Update! Winnipegs Available Listings

As of March 16th, Winnipeg is still suffering from a shortage of active listings.  On this date, the following homes and condos were available:

Houses in all parts of the city:  556

Condos in all parts of the city:  137

This goes a long way to explaining why any decent home or condo, priced accurately, is likely to receive multiple offers.

Compare these stats to another city of similar size to Winnipeg:  Edmonton AB.  Their current inventory is showing:

Houses available:  3367

Condos available:  2541

As per Edmonton Realtors Sara MacLennan and Sheldon Johnston, they are starting to see a subtle but noticable decrease in the multiple offers.  With inventory levels as they are, this should not come as a surprise.  With Winnipeg's lack of available homes, I do not see any immediate relief for buyers.

"Buyers-Agent": Benefits for home buyers in using their own Realtor.

Home Buyers can now be represented by their own Agent!

In early days of Real Estate, whenever a home owner 'listed' a home, ALL Realtors worked for that home-owner.   By the nature of the listing agreement, any agent who 'showed' the house, was technically employed by the home-owner.  This caused a few problems, for example:  There is a thing in law called 'vicarious liability'.  In short, any statement made by ANY agent representing the homeowner are deemed to have been made with that home-owners consent.  This often occurred even when the agent never met the owner.  Here is how that could work:  Image you list your home with John Smith of ABC Realty, and a week later agent Linda Brown of XYZ Realty showed the house to one of her buyers.  By law, Linda Brown represented the owner, and any comments or statements she made about the home in question, were deemed to have been made with the owners consent.

Naturally this caused a few problems, especially when the owner never had any interaction with Ms. Brown.

So about 15 yrs ago, a new type of arrangement was formed.  Now, right in the "Listing Agreement" which the owner signs at the time of listing the home, he/she agrees that any Realtor (other than the Listing Agent's office) who shows the home, represents the Buyer-Only.

So today, Buyers have a choice:  They can continue to look on their own, or work with one Realtor who represents them in their search.  If they choose the latter, the benefits are many:  the relationship between Realtor and Buyer is called an "Agency Relationship", and is governed by the courts.  In short, an Agent owes his client a number of duties, similar to those of a lawyer owed to his client.  Chief among them are the duties of Confidentiality, Full Accounting, Good Faith and Full Disclosure, as well as Competence, Obedience and Loyalty.

Here are some of the benefits of working with one agent:

Save Time:  In North America with have the M.L.S.  (Multiple Listing Service).  Under this system, ANY Agent working for ANY Real Estate Brokerage, can show and sell ANY Listing.  This can save the buyer time, as he only has to phone his Realtor who then has information on ALL potential listings on the market.  (Incidentally, I was just speaking with a client who resides in Germany, and found that they do not have this system there, but are still operating under the old methods.  He is finding that his Listing Agent is really the only one showing his house.  For any of us in Winnipeg who have listed their homes in the past couple of years, you know that this is not the case here, as many homes get 30, 50 or even 100 agents to show it, depending on location and price)

Convenience:  On their own, buyers can call the "Listing Agent" of every listing they want to see.  I hate to say it, folks, but whenever we list a popular house, we get dozens, if not hundreds of phone calls, and may not return the call as quickly as some of you might like.  On the other hand, if you (the buyer) have a working relationship with one Realtor, he/she are more likely to call you back within 5 minutes, as they already know you and are working with you.

Accurate Feedback:  Often I will take a buyer out on a tour, and he/she may like a house, but not enough to make an offer at this time.  Then they will call me back a week later to see how much that house sold for.  The buyer can then get accurate information on the sale, helping him/her to get more educated in the market.  This is a learning experience, after all.

Be represented:  As explained above, having your own agent means that you are represented.  The agent works for YOU and answers to YOU.

Get the fresh listings:  In Winnipeg, most listings have a "Start date" and an "Offers Date".  Receiving timely notice of a new listing is certainly a benefit on its own.  If buyers wait for the listing to be published in newsprint, it may in many cases be too late.

What is the cost of this?  Money-wise speaking it is Free!  Whether you have your own agent or buy it directly from the "Listing Agent', the price of the house will be the price of the house.  Some agents do ask buyers to sign an agreement which states that he/she agree to buy a home only thru that agent.  While this is not always the case, it is certainly understandable, given the amounts of time a buyer-agent may be spending with you in your hunt for a home.  In this market, it is not uncommon for buyers to have to put in 3, 4 or more offers on different houses before they finally get the one they want.  All that means many hours spent on the buyers behalf.

In this day of buyer-agency, it simply does not make sense to shop on your own.

Video: "Selling Your Home in Winnipeg"

In our hot market, some homeowners may feel that selling their home is fairly easy......almost FREE in fact.  As most people over the age of 25 have come to learn, nothing in life is truly ever FREE.  While they might save the commission, homeowners who choose the 'do-it-yourself' kit sacrifice exposure to the full market, thereby getting fewer offers and lower prices for their home or condo.

Here is a link to a short video excerpt (4 min)  which goes into the different ways homeowner can sell their home.  The full video covers added topics such as:

• Why Buyers work with Realtors
• How to choose your Realtor
• Benefit from Virtual Tours of your home

For the short excerpt, click on Free Video Excerpt

If you are thinking of selling your home or condo, and would like a copy of the full DVD, or a market evaluation, please contact me via e-mail or from the Contact button on the side of this blog.

55+ Condominiums: Geared towards the Seniors market

If you are looking for a Condo in Winnipeg with age-restrictions, the following is a list of units which may fall into this category.  This is certainly NOT an exhaustive list, but does list many of the condos with such restrictions, which are usually either 50+ or 55+.

Bell Cove (Headingley South)

Country Villas Blvd.  (E.St Paul)

3420 Grant Ave.

4314 Grant Ave.

380 John Forsyth Rd.

1460 Portage Ave

1976 Portage Ave.

3200 Portage Ave.

Rockmaple Rd.  (E. St. Paul)

4025 Roblin Blvd.

679, 681,685, 687, 697, 785, 795, 805, 815  St. Anne's Rd.

500 Tache Ave.

208, 212 Watson St.

687 Warde Ave.

20 Wynstone Cir.  (E. St. Paul)

If you know of any other condos which are age-restricted, please let me know by comment, so that we can add them here.

Also Read:

Condominiums: An Overview (Part 1)

Market Update: Value can be found in Winnipeg

The huge numbers of buyers who wish to buy a home in the south end of the city is causing a rise in the property values in that part of Winnipeg.

Whenever possible, I council potential buyers and attempt to offer them alternatives.  Here are a couple of fairly typical recent sales, one in St. Vital and one in Transcona:

In St. Vital, this home, with 936 sq ft home, built in 1924 but with upgrades and remodelling, on a block-foundation had been listed at $159,900 and sold for $203,000.  It had a single det. garage and a partially finished basement.  (This is a 'summer-photo' however the sale occurred in the middle of winter)

By comparison, this home in Transcona, was built in 1990, approx. 1000 sq ft with a double det. garage, a fully finished basement in a concrete foundation, c/air and 2x6 exterior etc etc.....listed at 189,900 and sold for $205,000.

While I can certainly dig up even more extreme examples, these two are fairly typical.   Advice to first-time buyers looking for a nice home at a reasonable price:  Look to areas other than the south end of the city, where 20, or 30 offers on a house are not uncommon.....

Must Read Articles

Costs involved in buying a home

What's this blog about?

As a Realtor in Winnipeg, I have the great fortune to meet many interesting and fun people, both Buyers and Sellers alike.  After a couple of years, I have come to understand that many of these folks have questions, often the same ones over and over.  It seems there are a lot of misconceptions and mis-informations out there, which might be addressed by way of this blog.

Being fairly new to blogging, I picked up the book "Realty Blogging" and did some research.  I understand that this is supposed to be "informational"  and not 'promotional'.  I get it and will make every effort to follow this basic rule.

If some of my posts will, on occasion, sound 'promotional', it is in an effort to promote the industry as a whole, as I am very passionate about my chosen career.  For example, in an upcoming post I will discuss the benefits for buyers when using their own Realtor in a search for their next home or condo.  In all cases, I invite your comments, feedbacks and opinions.

I will attempt to ad regular posts, so to keep the content fresh.  Perhaps the best way for me to do that is to ask you as to the kinds of topics you would like to see discussed?  Posts will include subjects from both perspectives...buyers and sellers.

So please, visit often, ask questions, add comments.........hopefully we can both learn from the experience!