Offering on a house is tricky. You don’t want to start too high and give money away. But if you start too low, the seller may not want to deal with you ever again. Today’s blog post is about that and the information homebuyers find on the internet.
Why is there so much old and out of date information about listings on the internet?
I received an email from a client this morning. He was interested in seeing a house for sale in Forest Heights. I looked it up and unfortunately it had sold just before Christmas. This happens all the time, in fact later in the morning I got a phone call from another client and the two houses that she was interested in seeing were both already sold (one conditionally).
The market moves pretty fast.
But real estate information still crawls along at a snails pace. And old information is slow to be removed.
It is rough being a real estate consumer in the day and age that we expect to have instant results, up to the minute information and easy answers to good questions. Here is a case in point. In the first example, (my client interested in the Forest Heights house), the link he sent me was from a discount brokerage advertising a big box agent’s listing. Discount brokerages as well as most of the other well-known real estate brokerages either have agreements to share the listings data or scrape the data and republish it on their sites. Agents do this all the time too – list other agents listing on their sites. This is usually fine as long as the listing agent and their brokerage is clearly identified.
For example, just Google the address of a listing I had late last year – 82 Euclid Avenue, Waterloo. On the first two page of Google, the listing comes up 20 times and 14 of those times are other brokerages repackaging the listing for their own site. Personally I don’t see how this is helpful to consumers. Actually, I don’t know how this benefits brokerages either.
About that Forest Heights listing
Besides that the listing was already sold, my client had a couple things wrong with his thinking about that. His email asked if he thought he could offer $330,000 for a $350,000 listing. He pointed out some flaws with the house that he thought he could justify a lowball offer.
He’s just getting started in his search for a new home but there are two things wrong with this approach.
1) Sometimes real estate agents get the listing price wrong. Often we list too high. Home buyers should never base their offer price on the listing price. They should base their offer price on comparable houses that have recently sold.
2) Most homes in Kitchener Waterloo sell for within 3% of their (eventual) list price. Knocking 8% or 10% off the listing price will never work, except perhaps in $800,000 and above homes and that will take a lot of work too. If the home is listed 10% too high, it might be best to wait for the seller to realize his mistake.
