Selling in Today’s Market

You only need to reach for a news article to understand that the Canadian real estate market is in flux. 

Keeping in mind that not all areas of the country are being equally affected (Toronto and Vancouver at the extremes) there is certainly concern in the air. With geopolitics (US-Iran, US tariffs) there are undoubted impacts on a number of fronts. We are seeing a shift in demand for condominiums with smaller units being affected most. However, you might be wondering what exactly does this mean?

There are some key factors that you will need to address:

1. Determining the list price of your property;
2. Negotiating the listing agreement with your real estate agent to determine;
3. Negotiating any offers to sell that you receive; and 
4. Closing needs

Determining List Price

Maybe the biggest question you need an answer to is what is going to be the list price. The answer to this question will set the tone of how your property is perceived in the market. Understanding sales trends is an important factor and over-pricing your property may result in subsequent lack of demand that needs to be corrected. Setting the price properly in the outset is vital; if you miss the proper market price you will then potentially be chasing reductions to try and recapture interest. This can and does result in over-shooting the reductions and ending up with a less than optimal sales price. 

This is a key discussion with your Realtor. There are certainly agents who will purposively over-price your property using this over-exuberance with the intention of obtaining your listing and then hitting you with price reductions shortly thereafter. 

This is simply not a productive exercise in markets in flux. Pick your Realtor based on the information they provide to justify pricing and not some price that simply isn’t justified.

Negotiating the Listing Agreement

Perhaps the biggest myth is that the Listing Agreement itself is not negotiable. In fact, the various real estate associations in Canada are obligated to ensure that the listing agreements are negotiable to avoid potential anti-competitive behaviour. That doesn’t mean it may not be presented as “standard” by your Realtor. 

Knowing this is more than half the battle. Setting out expectations of your agent and what they will and will not do to market your property is vital. When in doubt, get it in writing. There may be resistance to this by the agent but being clear at the outset is important. 

Negotiation Any Offers

Let’s be perfectly clear – this is not a Seller’s market – it is, at best, called a “balanced market.” That presupposes that you are not selling a property that there is a lot of volume of. If you are selling a standard sized condo in a high rise, this is definitely a Buyer’s market – a house in a limited neighbourhood? The lack of comparable product means you will stand out in the crowd. It’s all a matter of location and product type.

So you receive an offer, now what? That question is dependent on the property you are selling. We are seeing some properties with multiple offers and others mired for months so being aware of what you have is vital. 

Irrespective of the type of property, it is important to understand that your demands as a Seller may have to be tempered. The Buyer may be able to dictate some of the terms including condition dates, possession dates, etc. 

The key is to understand that as a Seller, be flexible and ready to act as needed. There are always lines you cannot and should not cross but demanding 2 months to move when the Buyer wants possession in 1 or vice versa is likely counter-productive. Keep options open, prepare yourself for potential quick possessions and some terms that may require you to complete certain items. That flexibility will serve you well and give you the upper hand over competitive properties in your area.

Closing Day Needs

Some things don’t change no matter the market – but their importance changes slightly. What is important is that in the current market, leave nothing to chance. The devil is truly in the details and making sure the little details are resolved is important. 

Items like a fully up-to-date AND compliant real property reports (RPR) completed well in advance of closing are important. Far too many times, Realtors do not address this and using the infamous “leave it to the lawyer” is no longer good enough. If your Realtor is not addressing whether your RPR is sufficient at the time of the listing, demand it! This has been a requirement in Alberta since 1996, there are no excuses for Realtors not addressing this issue at the time they meet you to list your property. 

Also, make sure you will be available at least 7-10 days before the closing date to sign documents. If you are leaving town, make sure your lawyer is aware of that well before you leave so that this can be accommodated. 

Ultimately, the current market has challenges. Alberta is uniquely placed again with a relatively robust economy and higher than average demand versus the rest of Canada. However, this can be shifting and you being aware of that puts you ahead of the pack. 

Feel free to contact us directly at 403 245 3500 to discuss any issues you have on selling your property. Let our vast experience and expertise help you succeed.