Winnipeg's Real Estate Blog

Selling your Home on your own? The Market IS Changing!

Update for October, 2008

"The Market IS Changing!"

By now everyone has heard about the US market and housing melt-down.  While we here in Manitoba are somewhat insulated from this, we are beginning to feel a change in the market.

Houses which were getting multiple offers, are now selling at 'list price', and other are taking longer to sell.

The first ones to feel the pinch will be (and are) the Private Sellers, who for years have been told that its 'easy to sell your own home'....you don't need a Realtor." 

Well, for years it was easier, mainly because there were so many buyers out there.  Once the flood of buyers has started to slow down, the remaining buyers now have a choice of homes to look at, and are doing so WITH A REALTOR.   Having a choice means "Less Competition", and so these buyers are no longer forced to consider the often overpriced, always inconvenient alternative of "private sales".

The time of being able to sell a house by simply 'plunking a colorful sign in the ground' is coming to an end.  This may have worked for some homes in a market which was flooded with buyers.  But in a more level market, where buyers no longer outnumber sellers by 10-to-1, finding the right buyer for your home requires a little more than a spot on the internet and a color ad in a magazine.  It requires teamwork and an organization with a proven track-record of over 100 years of success and service.

That type of teamwork is available ONLY thru a Realtor.  By listing your home, you will immediately gain access to all 1400 Realtors in Winnipeg, and all of the buyers working with them.

So if you are considering spending $700 on a Do-It-Yourself kit, please think about this:  Buyers who are looking for a house on their own will ALWAYS look at a "Listed House" (listed with a Realtor), but buyers who are committed to working with a Realtor will almost NEVER look at a "Private Sale".  Get access to ALL THE BUYERS.........List with a Realtor!

For a look at my marketing plan for YOUR home, click on  Marketing Plan

NOW is a very good time to buy!

The Winnipeg housing market has slowed somewhat from it's height of activity in the spring and early summer.

As evidence of this, we can see that currently there are over 1200 homes listed "For Sale" in the city, with another 245 Condos in addition to that number.

Compare this to the spring time when there were under 600 homes and under 175 condos at any one time.

Reasons for the 'blip' in activity:  it could be a number of things, such as pre-occupation with the federal election, or worries about the economy and the stock market fluctuation ("let's wait and see what happens" type of thinking).

No matter what the reasons, buyers have more choices right now than they have ever had during the year.  So NOW may be the best time to find a house and only have to compete against 1 or 2 other buyers.  But don't wait too long.....

Buyers ask: "How Much Should We Offer For This House?"

Perhaps the most common question would-be home buyers ask me is "What do you think this house will sell for?".  (Actually, homeOWNERS ask the same question).

The real, honest answer is: "Whatever someone is willing to pay for it."  Since we don't have a Crystal Ball, no one can predict the final selling price.  It all depends on how many offers there are on a house, and how badly someone wants it.  Incidentally, I don't like the term "bidding war", because that is really not correct or descriptive of the process.  But here are a couple of guidelines to help us along in the process:

If the house has been on the market for a few weeks, or even months (yes, that DOES happen, even in Winnipeg), and the owner and their agent have never adjusted the price, the buyer might try something a little lower than asking-price.  Provided that the buyer (with his own agent)  has done some comparing and homework, and assuming that the listing price of the house is not 'pie-in-the-sky-dreamin', an offer of a few thousand below asking price might be accepted.

If the house is 'taking offers' on a given date, and the buyer is lucky enough not to have to compete, putting in an offer of full-asking price might not be a bad idea.  Again, I stress that the buyer thru his agent, has performed a comparison-study of the house, and assured that it is fairly priced.  Assuming the asking price is realistic, a buyer might be well advised to count their blessings for not having to compete against a number of other buyers.

If the house in question is receiving 5, 6, (thirty?) offers, then all bets are off.  I've seen some pretty scary and ridiculous things happen in a case like this, and my best advice to my buyer would be: "Write your best offer....your walk-away price".  In other words, if the house goes for more than your offer, you feel you've given it your best shot and don't wake up the next day going "Doh" ala Homer Simpson.

The reason that 'bidding war' is somewhat of a misnomer: In a case of so many offers, the process is really pretty simple.....put your best offer forward and hope for the best.  On the plus side, at least you will find out almost immediately (within hours, anyway) whether your offer is accepted.

I've had a few buyers who have tried to buy a "Private Sale", and were left hanging for a week before being rejected.  In their case, they could not go out and pursue other homes, while their offers, (along with the deposit cheques) languished in the home-owners hands.  It seems that some private sellers are being 'coached' to hold on to offers and tell the buyers that they have to "think about it?".  Then, during the next week, while they are no doubt thinking hard, they are also 'shopping the offer around'. 

Please remember this:  yes, the market is hot, competition for homes is fierce.  However, homes listed with Realtors still have certain rules to follow, whereas private sellers are pretty much left unregulated.  Its 'buyer beware' to the extreme...

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!

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.

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.....

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