Kitec is a brand of plastic piping used in residential construction between 1995 to 2007. That means most condo buildings built during that time frame have used it. Kitec is vulnerable to premature failure and many buildings and condo owners have elected to replace it before it causes severe water damage. So what should you do? When you discover the existence in a status certificate, I would not reject buying the condo outright. You may never find the right property for you. If it is just in the condo unit, the cost to replace it is between $5,000-$10,000. So why not do an amendment to reduce the purchase price by that amount. If Kitec is in the common condo areas, to replace that would require a special assessment of each condo owner of about $3,000-$5,000. Again, why not do an amendment to reduce the purchase price by that amount ...
Purchasing a Condo with Kitec Plumbing
August 2, 2017
Industry Insights-Listing Price
August 1, 2017
Recently I had a potential seller phone to say that an agent from our Brokerage suggested a List Price that was too low and he would not be listing with us. Why would any agent suggest a list price at all? The role of the agent is to gather market information (solds and current listings) and explain the differences in these properties to the subject property. Interpreting the data is the agent expertise – not setting a list price. So, ask the seller what he would like to list at? Most sellers pick an agent based on list price and commission price versus value. Don’t eliminate yourself because of list price. If the seller wants a list price that is too high, simply say: I guess you are not in a hurry to sell. The seller will ask why? The answer is that you have to sell their property at ...
The Problem with Posted Listings
July 26, 2017
Today I want to talk about posted listings. Posted listings are those where a Seller wants to list their property on MLS. They pay a Broker a minimum fee to put it up then other brokers have to deal directly with the Seller. RECO says that this is all right. It used to be that when you listed a property, a REALTOR® had numerous obligations to the Seller and was liable for the information posted on MLS. Not anymore with posted listings. It's the wild, wild west! Deal with the Seller direct and try and figure out what they're selling. Many agents avoid posted listings altogether. It's too much work trying to educate the Seller. Those agents who attempt it, have to do both sides of the transaction. Represent your Buyer then do all the paperwork for a non-existent listing Brokerage i.e.: double the work for half the commission. ...
Underpricing Properties to Fuel Bidding Wars
May 4, 2017
One of our biggest complaints is the list price set by real estate agents in today's market. We understand that given the rapid rise in real estate prices, properties can sell for $50,000 or $100,000 over the listing price, but some real estate agents have taken the practice to an extreme. It seems to be a badge of honor to go $300,000 or $500,000 over asking. These agents start by taking the market value of the property and then they list it at $200,000 or $300,000 below the market price. This attracts the attention of buyers who see the property as a great deal but then drives a bidding war frenzy. Underpricing a property does nothing for buyers and sellers. How would the same agent feel if they walked into a clothing store and saw a designer jacket for $99? They would jump on it! But then, the store manager ...
The Fair or 'Vote Getting' Housing Plan
April 24, 2017
The dust is now settling from Premier Wynne's photo op on the 16 point Fair Housing Plan from last Thursday, April 20th. We call it a 'vote getting plan' for the next election. In reality, there are only two points that impact the real estate market today. The First is the 15% non-resident buyer tax and the second is rent controls. We don't believe the non-residential buyer's tax is a big factor in our market. We have far fewer non-resident buyers than Vancouver. When you look at Vancouver, sales and prices did drop initially, but today, prices are back to last year and sales are picking up. In Toronto, we expected a similar, but smaller 'pause' in the market. We expected some price softening, then prices to regain their upward momentum. This is because Toronto has lots of buyers and very little product. So far we have seen no media ...
Form 244: The Solution to Bully Offers
April 4, 2017
In a hot real estate market, Bully Offers are the biggest problem, not just for Buyers, but for Agents too. In every listing primed for multiple offers the Broker remarks say, "no offers until 7pm on such-and-such a date" then… guess what? A Bully Offer arrives 10 days early and the Seller wants to consider it. Now the Listing Agent has to race around to phone every other Agent who has booked an appointment to tell them the good news, or the bad news. We feel that if a property is primed for multiple offers, then that is the way it should be sold. Listing Agents complain that they did not want to entertain Bully Offers, but the Seller changed their mind. However, there is now a specific OREA form to solve the problem. It's called Form 244: A Sellers Direction in Property Offers. Once the Seller signs this ...
Conditional Clauses when Buying a Property
March 15, 2017
Every offer usually has some sort of conditions and they're all written for the benefit of the buyer. Take financing for instance, why is it written as "financing satisfactory to the buyer"? What does that mean, a 0% interest rate or 100% financing? No, the clause should state what type of financing is being arranged, not a clause that's open ended for the buyer to change their mind and walk away. What about a status certificate? It usually reads "to be approved by the sole option of the Lawyer". You know, most Lawyers can't even read a Status Certificate. I had one Lawyer tell me that he did not want his client to buy a condo, so he would not waive it. Once again, the clause is not to be used as an 'out clause', but rather to insure that the Condo Corporation can meet its financial obligations. Why not ...
Can You Believe How Few Sales Most Agents Do?
January 30, 2017
When the public tries to negotiate the commission down or tries to get a buyer rebate, their assumption is that all agents are the same. If all Agents were the same, then picking the agent who agreed to your request would net you the most money, but they are not! Did you know in 2016, there were 48,000 agents in the Toronto Real Estate Board? Did you know almost 13,000 agents did not do even a single sales end? And, there are two sales ends to ever sale, a list end and a buyer end. Did you know 25,000 agents, or over half the members of the Toronto Real Estate Board, did two sale ends or less in 2016? These are the agents that will offer you the type of deals you're looking for. Who do you want to represent your interests when buying or selling a property in Toronto ...
The Problem with Dual Agency
November 30, 2016
Dual Agency seems to be today's hot topic. Most people think it occurs when a Sales Person represents both Buyer and Seller. In realty it occurs when one or more different Sales People from the same Brokerage represent the Buyer and the Seller. When there are different Sales People from the same Brokerage involved, we should really rename this, Designated Agency. This is where RECO, The Real Estate Council of Ontario, should step in and introduce new rules to cover each case. The other problem is that a Sales Person acting in Dual Agency knows all of the offers submitted. Under the Real Estate and Business Broker's Act, you could only disclose the number of the offers and who are the Sales People presenting these offers. Why not change the rules? With competing offers, lets disclose all the terms of the offer; the price, conditions, closing date, etc. to all ...
Navigating FSBOs and Mere Postings
September 26, 2016
Since it's becoming a bit more common, this week we wanted to tackle how REALTORS® should navigate FSBOs and Mere Postings. Mere Listings are MLS Listings in which the Realtor has agreed not to provide services to the Seller other than submitting the listing to MLS, whereas FSBO stands for "For Sale By Owner." Getting Started One of the first things to consider when you get a new Buyer Client is creating two BRA (Buyer Representation Agreement) contracts, one for MLS Listings and one for Mere Postings and FSBOs. Each contract can state their own commission and this will actually create a dialogue with your buyer regarding various buying scenarios, agency relationships, buyer commission obligations and procedural and document handling. There are steps that you are going to have to follow when dealing with these types of transactions ,but first it starts with the Buyer showing interest. Different Scenario's So ...