Listing strategy and tough seller decisions for 2019

when is the best time to list my property?

While our Ottawa market has been favouring sellers for a year or two now, they still have a lot of important decisions to make in arriving at their listing and marketing strategy for a successful sale and maximizing the equity from their property.  Here are a list of items we think sellers will wish to consider:

When do I list my property?
Always a critical question, of course and one mostly determined by where one is moving and how long a current property may take to list, sell and close.
Our 3 biggest sales months of the year are typically April (#3), May #1 and June #2 which many sellers consider as the best time to sell.  Given our current low listing inventory situation, however, just about any time is probably OK for most properties.

How long will my property take to sell?
Days on market has improved with our strong market and most midrange properties should sell in approximately 30 days (or less!) and close in 45 to 60 days, although this varies with every property, buyer and seller.

MLS® listing or “exclusive” listing?
The best exposure to the most buyers is always via a full service MLS® listing that is exposed widely to all Realtors and their buyers through the MLS® ecosystem, especially realtor.ca. Some Realtors are plugging an “exclusive” listing strategy which has its purposes but is not as widely seen and generally not as effective for a seller in maximizing their marketing opportunity.

Pre-market via use of a “Coming Soon” sign on my lawn?
These signs have become quite prevalent, as listing agents seek to both do advance marketing and try to prospect for new clients via this grey marketing of listings that are not widely published via the MLS® system.  Though there are some legitimate uses for such a strategy, in most cases we think is more to the listing agent benefit than that of the seller.

Do I hold back offers until a certain date?
A very common strategy is to hold back offers during the first week or so a property is listed.  This gives as many buyers as possible the opportunity to view the listing in person and determine if they wish to submit an offer.  Multiple offers generally means the best market selling price available at the time but sellers may lose some buyers as a result.

Some buyers are not interested in the multiple offer process which can be stressful and seem like an auction.  Military or out of town buyers may not have the time to wait around until a seller offer date, as they are on tight timelines to identify and purchase a property, so one will lose most of these buyers by holding back offers.

What about a “bully” offer?
A “bully” offer is one that is submitted during the offer holdback period.  Such offers are typically very strong offers and also call for an immediate decision by the seller.  Tough call for sellers to make, as this buyer may come back on offer day or they may move on to the next property on their list instead and a seller may or may not get as good an offer come offer night.

Do I need to have an Open House in this market?
We suspect the number of open houses is way down these days, as properties sell quickly.  An occasional open house may still be useful for that casual buyer who is not working with a Realtor or the “I’ll-know-it-when-I-see-it-buyer”

How much commission should I pay?
There are two important components here: one is total commission to be paid but also the split between listing agent/brokerage and buyer agent/brokerage.  Sellers should understand both carefully, as there are a number of commission plans out there that may offer an attractive lower commission rate but also restrict the amount of commission being offered to the buyer representative and brokerage which may impact the interest level around that listing.

We are able to offer significantly lower commission costs than almost all other realtors, due to our status as an independent non franchise brokerage with less overhead to cover.  Give us a call and we can discuss your plans and how we can optimize your marketing opportunity and transaction costs.

 

Gord McCormick, Broker of Record
Dawn Davey, Broker
Oasis Realty Brokerage 613-435-4692  oasisrealty@rogers.com oasisrealtyottawa.com 

Key questions for Ottawa real estate 2019

Will mortgage rates continue to rise?
Rates have been creeping up but it is hard to say what we may see in 2019.  Another .25% probably wouldn’t hurt the real estate market too much but anything beyond that will certainly have an impact, when one also considers the mortgage stress test provisions.

 

Will listing inventory stabilize/improve?
We have seen very low listing inventory conditions throughout 2018, making life difficult for buyers and their agents.  Will this continue in 2019?  The number of new listings has flattening out somewhat in latter 2018 so we are not falling further behind on listing inventory but this will continue to be a critical factor.

Builders have had very strong sales in both 2017 and 2018, so it is possible there may be a backlog of resale properties to hit the market, once these new home (or condo) buyers are getting closer to taking possession of their new properties.

At what pace will prices grow in 2019?
If there was an anomaly in our market in 2018 it is the fact that resale prices did not increase as much as they might have, given the low listing inventory and supply/demand imbalance in favour of sellers.  The average residential selling price was up 5.1% to $446,415 through the end of November and the average condo sold for $278,330, up 2.8% vs last year.  Nice improvement but not the runaway sellers’ market some of the headlines would suggest has been occurring.  It is possible that the balance of sale % shifted towards lower price condos and townhomes which could have the effect of buffering overall % selling price increases.

What government action could impact our market this year?
Potentially long list here, with a Federal Government election pending, a new Provincial government in Toronto and a new city council in Ottawa.

Ottawa employment and general economic activity should be pretty stable with the current government or a minority government post-election but all bets are off, if a fiscally conservative government gets elected on a promise to balance the Federal books.  This would result in Ottawa government and private sector job losses and would chill the housing market.

Our biggest concern is what the Provincial government may do in terms of downloading, should Premier Ford decide it necessary to try and get the disastrous Provincial books in order.  Delays or cancellations to funding big projects like LRT2 or other infrastructure projects (Civic Hospital, Library) all could take a bite from the local economy.

Is MLTT coming this year?  We are fully expecting that at some time in the next couple of years, the City will join Toronto in the implementation of the Municipal Land Transfer Tax (MLTT), as this would add up to $150 million annually to the city tax revenues, without impacting most taxpayers.  Since only 5 or 6% of homeowners buy or sell each year, it is almost the perfect tax, since those not concerned with buying or selling are less likely to get hot and bothered over this type of tax.  The impact of an MLTT would be pretty significant for a buyer:  on an average residential property this would mean an additional Land Transfer tax (on top of the existing Provincial amount) which would total $10,950 for the buyer of the average $450,000 property and $18,950 for the buyer of a $650,000.

This tax has been in place in Toronto for almost a decade now, without destroying the Toronto real estate market and generating something like $800M a year in tax revenue, so don’t be surprised if this is coming our way!  When you think about it, the revenue from such a tax would almost be enough to be able to offer free transit or at the very least, half price transit which would help boost declining ridership.

Will LRT be a success?
The long awaited LRT will be pretty exciting but also nerve wracking in 2019. How well the system launches and is accepted by commuters will have an impact on the “transit oriented development” meme and developer plans/timing to populate high density condos and rentals along the transit route.  If we don’t see ridership meet projections then many things could change or be delayed.

What now for Lebreton?
The recent gyrations at Lebreton Flats and the poor sales to date at Zibi, may simply be indicative of the market overall appetite for high end urban condos but there is no question that the recent “failure to launch” will slow sales of any project in that immediate area.  After all:  who wants to plunk down a pile of dough for a condo that may get built in 3 or 4 years, next to you-don’t-know-what?  We think most consumers (and their realtors) will be hesitant to jump headlong in to pre-construction purchases, given the Lebreton saga and current status.  Unfortunately, we can’t expect the Feds to be too engaged on this file going in to an election, especially with a new Chairman at the helm of the NCC.

Bottom line:
Short of any major worldwide economic event, we see another pretty good year ahead for Ottawa real estate, despite the “cooling” reports you may be seeing throughout the national media.  Real estate is very local and all indicators look pretty good as we open the doors for 2019.  Our view is that those considering plans will want to move on those sooner rather than later, as prices continue to rise.  It is never too early to start both buying and selling plans and getting your Realtor team together, is always a good start!

Best wishes for a happy and prosperous 2019!

Gord McCormick, Broker of Record
Dawn Davey, Broker
Oasis Realty Brokerage
613-435-4692  oasisrealty@rogers.com
www.oasisrealtyottawa.com