Being pro-active by taking a cold hard look at properties is so much more important in the present market with competition (and the clock ticking) being the rule of the day. We will never advise not doing a home inspection.
CASE STUDY 1 WHOA, NELLIE!!!!
We were working with a very serious buyer. He had seen a listing online, a reasonably priced 2.5 storey home. We have a long and very solid relationship with him and he wanted us to run over and “check it out”. He was out of town but was already in the throes of having the cheque made out. Heartbreakingly we discovered the property was leaning to the south by about one foot! It was a lovely home but the amount of work required was prohibitive. “Tear up that cheque”. He knows and trusts us and took our advise…
THE TAKE AWAY: Being proactive by taking a cold hard look at properties is so much more important in the present market with competition being the rule of the day. We will never advise not doing a home inspection. But in this market inspections have to be done prior to the offer being submitted, and only if there is time. We can advise you, from our perspective, on the worthiness of the property prior to an offer.
We are happy to save you the $450 for a home inspection and the ink on the offer if the property just isn’t worth the bother.
CASE STUDY 2
We were about to list a property in a very affluent area of Hamilton. We already had our “suggested” listing price in mind. Meanwhile a neighbouring property came on the market. It seemed to be priced correctly at first read. We made sure we visited this property and had a good long look as it was going to be direct competition. After previewing we concluded that it was actually over-priced and by a lot. But as a result of the neighbours’ high priced listing our sellers were now having their doubts as to our more realistic price. But we persevered. We advised on vital work to be done to the sellers’ property. We then had it staged and photographed beautifully, and it sold in competition considerably over asking. As for the other property? Well it languished on the market a while longer, finally selling for significantly less than our sellers’ property sold for. Read on:
Here are the numbers on the the two subject properties:
Listed property (After our “hit list” of work was completed , complete staging inside and out) $809,000
Sold in five days for $830,108
Reduced 19 days after listing to $899,000
Reduced again 14 days later to $849,000
Sold 6 months and two days after original listing date for: $740,000
THE TAKE AWAY: It’s incredibly easy to tell the seller what they want to hear (and incredibly easy to get that listing!!) But LaLaland is a great movie, not where your home should be priced. The “reduction” talk is inevitable when the property isn’t being shown and other area homes have sold in competition. Better for the seller to hear the truth (and accept it) from the realtors (us!) who are being professional and (perhaps painfully) honest (yup, that’s us again)! Even in the present market we see reductions. Smart pricing together with a home-makeover and a great internet campaign will go a long ways to the best offer on your property.
CASE THREE – Is there a submarine in your yard (or maybe a hidden oil tank?)
We had very motivated buyers for a large and impressive property on an exclusive street. The property was in good shape but seriously out-dated. Our buyers were happy to purchase and to hire on a contractor to bring it to where they wanted it.
When walking around the perimeter of the property we found ourselves in a little niche that sat between the back of the garage, behind a fence that was overgrown and the north side of what seemed to be an extension. It was accessible but took a bit of doing to get there. But hey! You’re buying a house? Let’s look at the whole house! And that is where Bruce saw an exhaust pipe normally seen on buried oil tanks.
The seller, who was older (and very sweet), was questioned as to a buried and perhaps forgotten oil tank… She assured us that her husband had done all the due diligence (thirty years ago) when they switched to natural gas… the tank had been emptied and filled with sand. Letters verifying this were presented. However, what was environmentally acceptable thirty years ago just doesn’t fly today. Today the tank has to be removed, soil tested and cleaned. That’s when it gets dicey with a capital D. It comes out of the hands of the property owner and falls into provincial jurisdiction. Anyone removing the tank has to be licensed to do the work and the province is privy to all tests. So maybe it will be clean. But what if there has been a leak… How far will it run to? The neighbour’s home? Maybe a couple of neighbours’ homes?
The price tag could be huge for whoever undertakes this work. The seller would move on price but would not undertake any of this work. We urged our buyers to walk away (RUN!) They took our suggestion and purchased another lovely home, free of buried oil tanks… The listing agent called us several times to see if our buyers would consider an offer if price were lower. Nope. Sorry.
We were disappointed to see that the listing agent had not done her due diligence and hadn’t walked the property completely. All of this came as a complete surprise to her. It would have been far better for her seller to have disclosed and discussed the issue and dealt with it proactively regardless of possible cost rather than to risk future law suits and massive damages. At the very least it should have been disclosed on the listing.
So it’s a double TAKE AWAY: 1) As a seller, always disclose to your realtor anything that could be a problem down the road. Honesty is the best policy, often the least expensive and you’ll sleep better at night.
2) Buyers: Walk the property completely and abide by what we suggest! It was made very tempting to take the property at a lower price… but possible lawsuits could have run almost the value of the property itself. There’s always another property out there.