How to Bid Low on a Home Without Offending the Seller

By Amy Hoak
From MarketWatch

Buyers who do ask for deep discounts risk offending sellers to the point where they quash any deal. So before making an aggressive offer, some homework is in order, real-estate professionals say. And buyers will need to effectively explain why the price of a home should be lower.

… And there’s always an inherent danger in going too low. A low offer could insult the seller to the point that they’ll refuse to counter, Realtors say. And the seller could easily make the assumption that the buyer isn’t committed to making a deal.

“When you’re making the offer,” says Jon Boyd, Mr. O’Heron’s agent and president of the National Association of Exclusive Buyer Agents, “if you justify that offer with outside data, then it’s much less likely to be perceived as being an insult or [the buyer] not as serious.”

Here are three guidelines on how — and when — to make an aggressive bid:

1. Learn how motivated the seller is to make a deal.

Certain sellers are going to be more willing than others to negotiate a low offer — and there are several giveaways that might indicate more leeway on price.

For instance, if the sellers have already purchased another home and that sale has closed, they’re likely to be more willing to make a deal, says Dick Gaylord, president elect of the National Association of Realtors and a broker with Re/Max Real Estate Specialists in Long Beach, Calif.

If the property has been on the market for a long time, sellers will be interested in entertaining any offers, he adds.

Mr. Gaylord says he talks to the seller’s agent to get as many details as possible about how motivated the seller is.

2. Make your case with hard facts.

When putting together an aggressive offer for a client, Mr. Boyd doesn’t just hand the seller a purchase agreement with the price the buyer is willing to pay — he creates a cover letter explaining exactly where that number came from.

In addition to citing comparable sales in making the offer, it also could be important to include details regarding the amount of inventory in the immediate surrounding area, he says.

…

3. Prepare for the possibility of rejection or negotiation.

Ultimately, a real-estate agent working on behalf of a buyer needs to honor and facilitate the offer that the buyer wishes to make — even if it seems to be too low.

Mr. Gaylord warns buyers making very low offers that the seller might refuse to negotiate. On a “super aggressive offer,” Mr. Boyd says he might tell a client “there’s a one in five chance there will be a positive response.”

Still, there’s that potential for a seller to make a counteroffer, especially if there haven’t been many other bids.

Danielle Kennedy, a real-estate sales coach and author based in Pacific Palisades, Calif., advises sellers not to think of a low offer as an insult but as “a sign of interest.”

It “begins the dialogue regarding the purchase of your house,” she says.

Not all hope is lost even if a seller doesn’t bite immediately.

Sometimes after time elapses, the seller comes around and decides to negotiate, Mr. Boyd says. New information — such as the sale of a comparable home at a lower price — also can nudge a seller to give an aggressive offer a second look and open the negotiation process.

Don’t Let an Empty House Jeopardize a Sale

More home sellers are leaving their properties completely unfurnished while they sit on the market. Some argue that an empty house lets prospective buyers more easily picture their belongings in the space, take measurements, and examine recent improvements.However, real estate brokers warn that empty homes must be well maintained, as overgrown lawns could lead buyers to wonder what interior components have been neglected as well. They recommend that sellers keep vacant dwellings clean and in top-notch condition, as flaws cannot be camouflaged by furniture.

Some buyers seek out empty homes because they believe the owner is desperate to make a sale. Sellers unable to generate buyer interest are urged to bring in some furnishings to create a lived-in look.

Source: Virginian-Pilot, Joanne Cleaver (08/18/07)

Large suites ready for moving in

It’s not often you get to walk through already-built suites for sale in a new Toronto condo building.

This project features 364 hectares of parkland across the street and the historic Inn on the Park next door.

Monarch has a handful of units available in Haven, the third and final phase of its Carrington development at Leslie and Eglinton, beside the historic Inn on the Park.

“You can see what you get,” says Linda Mitchell, vice-president of sales and marketing highrise for Monarch. “The site is built out, so there’s no more construction, no noise going on… it’s the last phase of three buildings. The landscaping, everything’s all completed.For those who don’t want to go through construction for the next three years or wait for their suite. There are a few left.”

Haven is one of three buildings in the development located a few minutes’ drive to the Don Valley Parkway and Highway 401.

“It’s not downtown and it’s not one of these new King West areas, it’s almost like a long-lost forgotten area without a lot of recent development in it,” Mitchell says. “If you like greenery and you want to be away from the hustle and bustle but close enough to it, it’s perfect for that.”

The available suites are spacious,, ranging from a 1,250 square foot two-bedroom unit to a 1,862 square foot two-bedroom plus den unit. Prices go from $391,990 to $643,990.

All remaining units come with two parking spots.

Units feature balconies with park views, nine-foot ceilings in principal rooms, pre-finished engineered hardwood flooring in the living/dining room, den, library and hallway, five-inch baseboards, granite kitchen countertops and double or single stainless steel under-mounted sinks and six brand name appliances and soaker tubs, as per plans.

In addition, the largest suite includes a six-foot whirlpool tub, stainless steel appliances, cornice moulding in the living and dining rooms and extended high kitchen cabinets.

Amenities include a party room with caterer’s kitchen and bar that opens to a landscaped patio, a fitness room, a theatre and sports lounge.

For more information, you can contact us here.

Source

Updates

Listings for all condos have been updated as of yesterday.

Also, the Residences of College Park (North Tower) at 763 Bay St. has been registered and now a handful of listings have already come to market.  You can take a look at them here.

Looking for something more affordable?

Half of suites priced under $200,000

SYDNIA YU

To cater to the demand for more affordable housing in an urban setting, Monarch and Goldman Group have priced nearly half of the condo suites in their new building in Scarborough at less than $200,000.

The 40-storey tower, called Red, will have units ranging from one bedroom to two bedrooms with a den, starting as low as $153,990.

“A lot of the downtown core has gotten out of the price range for people to buy,” says Linda Mitchell, Monarch’s vice-president of high-rise sales and marketing.

“[Scarborough is] one of the last locations for affordable product … that offers all the shops, transportation and amenities that you’d see in a city centre.”

The 370-unit building will be officially launched tomorrow. It’s the latest addition to a master-planned community to the south of the Scarborough Town Centre, called Equinox. More than 500 units have been sold in 29- and 35-storey towers under construction, and over 600 units in two 37-storey high-rises are occupied.

Within a block of the site, a mall includes many retailers, restaurants and a movie theatre, and a Loblaw super store is planned for the area. The site will have easy access to the Scarborough rapid transit system and Highway 401.

Within Red, there will be such recreational amenities as a gym, sports lounge, a theatre with cinema-style seating, as well as a party room with a caterer’s kitchen, bar and billiards table.

Suites will have expansive windows, balconies and in some cases, solariums. Most layouts will have galley-style kitchens and principal rooms separating the bedrooms.

“The floor plans are more of a traditional and practical nature,” Ms. Mitchell says.

Standard features include strip laminate flooring, sisal carpeting or 40-ounce broadloom. Kitchens will have ceramic-tile backsplashes and granite countertops.

Green features will figure more prominently than in previous towers. Among them are low-E argon-filled windows, paints with low levels of toxic emissions, and an automated system to sort waste and recyclables.

Each unit will have individually metered hydro, five appliances — including an Energy Star fridge, built-in dishwasher and stacked washer — and low-flow showerheads and bathroom faucets.

Monarch will provide a car-sharing program, and buyers who do not purchase a parking spot will receive transferable TTC metro passes for one year.

Other conveniences will include a 24-hour concierge, guest suites and a car wash bay in the garage.

August Prepares to Roar into Fall Market

August 17, 2007 — Resale home transactions reached unprecedented heights in the first half of August, up 17 per cent from the same period in 2006, Toronto Real Estate Board President Donald Bentley announced today.So far this month 3,838 properties have sold with an average price of $355,829.

“The market has shown tremendous strength in recent months,” said Mr. Bentley. “Given that August sales have been brisk thus far and that the past four consecutive months have all set records, we are looking forward to a robust fall market.”

The rate at which transactions are occurring has increased over 2006 as well. On average, properties are currently on the market 32 days before selling as compared to 38 Days during the first half of last August.

Sales were particularly swift in the neighborhood of West Agincourt (E05) where there was an overall increase of 71 per cent in sales compared to mid-August 2006 as detached home transactions doubled.

In Rexdale, the W10 district showed a 54 per cent increase in overall sales compared to mid-August a year ago due to large increases in both condominium apartment and detached house sales.

In the Downtown Core (C01), 27 per cent more transactions took place overall compared to the same period last year as a result of a 34 per cent increase in condominium apartment sales in August 2007.

Detached and condominium apartment sales in South Richmond Hill (N03) fueled an overall increased of 41 per cent as compared to the same timeframe a year ago.

Mr. Bentley offered one word of caution with respect to the market outlook, noting that the potential for a second land transfer tax in Toronto could be a wild card.

“The health of the current market is good news for Toronto’s economy. We hope that the City of Toronto doesn’t jeopardize this market by imposing a second land transfer tax on home buyers,” said Mr. Bentley.

TheStar: “Small details, big picture”

Scale models are crucial tools for condo hunters trying to visualize unbuilt developments

Aug 11, 2007 04:30 AM

Stephen Weir
Special to the Star
Lisa Mills searched for about two weeks before signing up to buy a new downtown condominium. And like most others who did the same thing last year, Mills hasn’t yet seen her actual unit.

She made her decision based in large part on a scale model – a place populated by Tom Thumb families with dollhouse furniture and Dinky Toy cars.

“Some of the sales brochures are very elaborate,” the 20-something executive says. “But I had trouble visualizing a yet-to-be condo simply by looking at a floor plan. There were a number of factors – location being the most important – but at the end of the day it was the model.”

Most of the 17,000-plus new condos purchased in the GTA last year were snatched up before any shovels hit the ground, according to RealNet Canada Inc., a real estate information services company. It’s an arrangement that’s not likely to change any time soon since pre-construction prices are usually the best. So developers have to talk big and think small if they hope to fend off competitors and attract buyers.

A built-to-scale model of a proposed condominium project, grandly showcased in a project’s sales office is often “the deal maker.” In the GTA, condo developers rely heavily on miniature architectural models to give potential buyers a glimpse of the big picture. Experts such as Melissa Moore of marketing firm 52 Pick Up, Les Klein of Quadrangle Architects, Mark Cohen of Tribute Homes and Pat Baker, CEO of Baker Real Estate Corp., say people in the market for a condo tend to make a decision soon after seeing a Plexiglas Lilliputian version of their new residence.

“I looked at three different buildings,” Mills says. “I particularly liked the floor plan at one building, but I became totally turned off when I looked at the model and saw that the unit I wanted was one floor below the party area. I could just see the possibility of noise. If I bought from the brochure I never would have known … until my first Friday night in the building.”

Mills bought a condominium in the Vü, under construction northeast of the St. Lawrence Market. She decided to purchase a 12th-floor suite almost immediately after looking at the tall Plexiglas model of the block-sized project. “When I looked at it I actually didn’t like the adjoining balcony. When the sales agent said that there had been a slight mistake made in the model and that I would have a freestanding balcony, it suddenly had that appeal … and now I am its proud owner …”

The tiny towers that Mills looked at were crafted with computer-driven accuracy. The acrylic walls were laser-cut from architect plans. Artists then glue it together and apply colour.

The finishing touches are the small figures barbecuing on the eighth-floor patio, cars on the parking ramp and the forest of lush green painted wire trees on the tiled roof garden.

The model is constructed only after the project receives zoning approval, but it can be years before the project is completed and people have moved in.

According to Baker, “women have trouble visualizing a building based on a two-dimensional floor plan.”

“Seeing an actual model does make a difference. We deal with sophisticated buyers who may have already seen a dozen buildings before they look at ours. So it is not surprising that they often look at the model and buy right on the spot.

“Be it the Ritz-Carlton, or something more modest, we are selling dreams, lifestyle to consumers,” she says. “This gives reality to that dream. Potential buyers can look at it and imagine what the building will eventually be. With some condo models we can light the suite a person is considering!”

The models take about six weeks to build. They are usually displayed in a sales office located as close to the proposed site as possible.

“We align the model exactly as the condominium will eventually stand,” Baker says. “That really helps when we familiarize our sales staff (her company employs more than 200) on the new project, who, in turn, will show buyers where the building will actually fit into the immediate neighbourhood.”

There are a half-dozen major companies in the Toronto area that produce Plexiglas towers for developers – here and around the world. The average model costs about $30,000 to build – small potatoes compared to the expense of creating a website, printing six-colour brochures, pressing promotional DVDs, building and staffing a sales office and model suite, placing advertisements and staging a launch party.

“These are the marketing tools we use to drive traffic to the sales office to see the model and the model suite (life-size mock-up of a typical suite),” says Melissa Moore, a senior account director with 52 Pick Up, a leading real estate advertising and marketing agency. “The model is so very, very critical. You have to know what you are going to see every day when you stare out of your (new condo) window, to make a buying decision.”

“The ads are lifestyle. It is emotion we are selling, especially to the first-time buyer,” Moore says. “The scale model and the suite are the only tangible things we have.”

“A developer just can’t go out and build a condominium without pre-selling a large percentage of the suites. He just wouldn’t get the financing,” says Les Klein, founder and principal of Quadrangle Architects. “The bottom line is that enough people have to buy into a project at a very early stage before the developer can go to the bank. So how do you get people to commit before there is even a hole in the ground?”

Quadrangle has designed both retrofits for downtown buildings (City TV and the BMW Head Office & Show Room) and noteworthy new projects (900 Mount Pleasant, Liberty Village and the St. James Condominiums).

“These sorts of projects use a model – and it is usually very large – taller than the average person,” says Klein. “The scale is typically 1:75 or 1:50. Models are critical to their marketing to explain the project, and it has to have a `wow’ factor.”

Riz Dhanji is a vice-president of Canderel Stoneridge, a Montreal-based company that developed the Residences of College Park I and II and the Waterford.

“We are very proud of our architectural model and the detail that we put into it. This is the only way that we can show you where your new suite is; our amenities; where you will park your car; and what buildings and streets are around you,” he says.

“We do use (computer-designed) virtual reality programs to demonstrate our new projects but they don’t give the touchy feely experience that consumers want,” he says. “The future may be holograms, and 3-D images but that technology isn’t there yet. The model is relatively cheap and it works.”

“Holograms are Star Wars technology and are light years away from being an affordable reality. But it is fun to think about,” says Peter McCann.

The owner of Peter McCann Architectural Models has supplied the models of several high-profile projects in Toronto including the under-construction Ritz-Carlton and the Four Seasons Private Residences. Internationally, his Niagara St. facility has built models for clients in the U.S., Europe, Asia, and the Middle East.

“We built a scale model for (what will be) the world’s tallest building, the Burj Dubai (part of a $20-billion development in Dubai) McCann says. “It ended up being 27 feet (8.23 metres) tall and 34 feet (10.4 metres) wide. We air shipped it in 25 crates and spent 15 days assembling it in support of the building’s sales campaign. It will be the world’s tallest structure at a height of (808 metres) 2,651 feet and 162 floors and has a huge inventory, yet all of the units were sold in that very first day.”

The Dubai model became obsolete in just 12 hours.

“What do clients do with their models when the project has sold out? Throw them out I guess,” McCann says. “These are works of art on one level, yet first and foremost they are selling tools.”

“We like to hang on to them as long as possible,” Baker says with a laugh, pointing up at five mammoth models cluttering her Bloor St. headquarters.

“The sales office is closed down just before construction begins. We continue to use the model, either in a satellite sales location or here in my lobby.”

“We used to send them back to our head office in Montreal, where we would proudly showcase them for our guests,” Dhanji says.

“But, now there just isn’t the room. And there isn’t much of a demand for last year’s model.”

Listing Description of the Week!

This appeared in one of the condo listings downtown.  This made me laugh:

“Absolutely stunning.  Show your fuzziest buyers …” LOL

 Yes I do have a weird sense of humour.

Updates

The following updates were made yesterday:

• for sale and for lease listings are up to date
• added two fantastic buildings in the C8 district - Spire and The Met

July 2007: “More Records Broken”

TREB Members reported 8,912 total sales in July, 26 percent ahead of the 7,082 sales recorded in July of 2006, and an all time record for the month.

While sales have set a blistering pace, prices eased in July, down two per cent to $366,012 from June’s average of $373,719. “This decline is seasonal in nature,” said the President. “Prices tend to ease in July/August as potential homebuyers and sellers go on holiday.” He went on to note that the year-to-date average, at $373,326, was up five per cent over the same time-frame in 2006.

Breaking down the total, 3,424 sales were reported in TREB’s 28 West districts and averaged $347,978; 1,590 sales were reported in the 14 Central districts and averaged $470,464; 1,797 sales were reported in the 23 North districts and averaged $392,360; and 2,101 sales were reported in TREB’s 21 East districts and averaged $293,819.

* C01 district: On average there were approximately 10 homes sold per day in the C01 district.  The average sales price and median price for the month of July was $321,722 and $286,950, respectively.  Compare this to June’s figures of 11 sales per day with average sales price and median price at $315,207 and $281,000, respectively.