Re-printed from Ontario Industrial Magazine

Selling or Buying a home can be a lot easier if you plan ahead and avoid the most frequent pitfalls. This month we look at common mistakes to avoid when either buying or selling.

Mistakes When Buying

Relying on the advice of the Seller’s Agent

The Seller’s Agent represents the Seller’s interests , not yours .Always use your own Agent who has no vested interest in you buying any individual property and will represent your interests exclusively

Signing Documents without fully understanding them

Don’t wait until the last minute before reading documents. Get sample copies of all relevant documents and have your Agent walk you through every line of a sample Offer so you can ask all the right questions before you’re caught up in the excitement of a particular home

Making Verbal Agreements

Under Contract law verbal agreements are not enforceable when they deal with Real Estate.

Get it in writing !

Not Asking for a Seller Property Information Statement

This simple form requires the Seller to reveal any known defects or relevant issues and to take responsibility for the truthfulness of the information provided. If you don’t ask for it, you won’t get it.

Buying without a professional Home Inspection

You are investing Hundreds of Thousands of Dollars. Spend $300 to $400 and know what you are getting for your money.

Letting ‘First Impressions’ cloud your decision

There are entire books about how the first impression of a home is the single most decisive factor and a whole industry of ‘staging’ has sprung up to help create the best first impression.

On the one hand, don’t let the flowers and candles and the smell of baking bread have too much influence. None of them will be there when you move in.

On the other hand don’t let bad décor or messy housekeeping scare you away from a structurally sound home that meets all your needs. Remember, you are buying the house, not the furnishings or the housekeeper.

Looking for a home without being pre-approved by a lender

When you are pre-approved you are in effect a cash buyer which improves your negotiating position.

Don’t mistake pre-qualification, which is simply the first step, for pre-approval. Ask your Lender or your Agent for details.

Assuming that Mortgage Rates are cast in stone

Like every industry Banking is competitive. Depending on the market and current spreads it is usually possible to negotiate substantial savings from ‘posted rates’.

Failing to check out the neighborhood thoroughly

How do traffic patterns change depending on the day or time of day ? Are there any future developments in the works ? Is that nice green space actually zoned for development ? Ask around-check it out.

Making an Offer based on ‘Asking Price’ rather than actual Market Value

What have similar properties sold for in the immediate area ?How long were they on the market ? How does this one compare ? Does the Listing Agent have a history o over-pricing ?  Have your Agent do the homework.

Mistakes When Selling

Pricing Too High

Make sure you correctly determine the market value. If your asking price is higher than the market is currently paying, many of the potential buyers will never see your home as they will first look at similar ones that are better priced. Not only does this limit your prospects but it increases the chance that your home will ultimately sell for LESS than market value. This is due to the ‘discount’ associated with homes that have been on the market for longer than average.

Pricing Too Low

At certain times and in very specific neighborhoods a low list price may help to start an ‘auction’. However for most sub-division homes and most neighborhoods it will simply result in a low selling price.

Losing Sight of the ‘Big Picture’

Moving up in a market downturn ? If your $300,000 home has dropped 10% in value, so has your $600,000 dream home. Yes, you drop $30,000 on the current property but you probably save $60,000 on the new one.

Ignoring Market and Economic Trends

Is it a Buyer’s market ? A Seller’s Market ? A Balanced Market ? Ask your Agent for details.

Choosing the wrong Agent

It is crucial that you have full confidence in your Agent’s experience and abilities. You need someone who listens to your priorities, will explain the whole process, has a good feel for the market, and offers sound advice on how to improve your sale value.

Choosing an Agent for the wrong reason

Don’t choose an Agent on the basis of which one gives the highest estimate of the home’s value. The Agent may influence the list price but doesn’t set the selling price; the Market does that !

Limiting Market Exposure

Part of your Agent’s job is to ensure your property is marketed in the most productive manner. Not allowing a sign on the property or restricting viewing times will dramatically reduce the number of prospective buyers and will reduce your selling price.

Failing to “Showcase”

A little work can improve the important ‘first impression’ and can greatly affect perceived value.

Trying to “Hard Sell” during viewings

No one likes being pressured and buyers will wonder why you are so anxious. Let your home speak for itself

Confusing “Lookers” with “Buyers”

Many people who look at homes for sale may be just getting a feel for the market, seeing how others showcase their homes or even just looking for decorating ideas. Your Agent has the experience needed to separate the Lookers from the Buyers so let them do their job.

Paul Graham is the owner and Broker of Record for BUYERS REALTY INC.  Please direct your questions to paul@buyerscall.com or to his direct line, 905-607-4400