Today’s condo buyers are so savvy, and I love it! You may fool a few of them, but not most.
And when you try to pull something sneaky, it makes you look bad when they catch you!
What is “marketing?”
What is “advertising?”
What do these words mean to you?
And what guidelines, procedures, rules, regulations and to a higher extent – ethics, must you follow?
Think of the commercials for Red Bull for a moment, where they show somebody drinking the product, and then flying away. They say, “Red Bull gives you wings,” and then voice-over with, “Well, Red Bull actually helps to temporarily restore mental alertness and wakefullness.” So they show their product doing one thing, and then basically say, “Actually, it doesn’t do what we just showed it to do.”
Or what about car commercials? They show a car driving through the woods, and flash $19,900 on the screen, with the word “from” in tiny font, and then in even tinier font, they write, “Actual model shown with upgrades costs $32,000.”
Or think way back to the “Pepsi Points” promotion when they showed that a t-shirt costs 1,000 points, a scooter costs 10,000 points, and an F-18 Aircraft costs, 10,000,000,000 points. Remember how they flashed the words “not actually” at the bottom of the screen in reference to the F-18 Aircraft? And then remember the scandal when some moron (or smart person, depending on how you see this) accumulated the necessary 10,000,000,000 points and went after Pepsi saying that they owed him an F-18 Aircraft?
Is this marketing? Is this advertising?
Is this fair?
I’m tempted to say “anything is fair in advertising,” but that’s not the case, since false advertising is illegal.
At the end of the day, the consumer has to be somewhat responsible for doing some research into the claims of the product.
But is it fair for a company to market a product and say “We do/offer/provide this,” and then follow up with “We don’t actually do that?”
I don’t think so, but again, a sucker is born every minute, and people will always be taken advantage of.
When it comes to real estate, there are thousands of instances of false or misleading advertising on MLS listings. I show these on my blog all the time – from square footage, to photos, to captions.
But I’m of the opinion that today’s real estate buyer is savvier than ever, and can usually see through the BS.
The point of my contention today is the following caption from an MLS listing, where the property was listed with an “Owned” parking space:
This is complete and total BS.
But the worst part, is that this is only contained in the “Broker’s Remarks” that isn’t seen by the general public.
I’ve written before about how frustrated I am when I see “1” under “parking spaces,” when there isn’t really parking.
I believe I wrote a whole post on the subject, and gave examples.
Rental parking should not be considered “owned” by any means.
Or how about when they list “1” parking space, but then add “Parking is available if you tear down your back fence and park in your backyard?”
And what we see in the caption above, is complete BS as well.
The MLS listing shows one “Owned” parking space, and shows it to be in the building in which the condo is being sold. But in fact:
1) There is no existing parking space.
2) The space is not in the building where the unit is located.
3) The space is not owned.
4) A mere deposit has been made on a future space.
I have a huge problem with this.
But it gets worse!
The caption goes on to read, “Rent out for $200 – $300 per month.”
Now, a lawyer would argue that this is a direction, not a claim.
A lawyer would say, “If you read ‘Go jump off a bridge’ on a billboard, and you jumped off the bridge, you can’t just sue the billboard company! Those were just words! Nobody forced you off that bridge!”
But when you make a statement like “Rent out for $200 – $300 per month,” as a real estate professional, you’re advising the uninformed that you CAN obtain this amount for a parking space. Aren’t you? If you’re not, then what’s the point? Why not write, “Buy this car and pretty girls WILL have sex with you?” “Wear this lipstick and single, successful men WILL marry you!”
We all know that $300 for a parking space in Toronto is not attainable. Now I know that somebody is going to say, “David, I’ve seen this amount paid at such-and-such condo,” but can we just agree that the average price is around $150? The Average, I mean.
I’ve seen spaces rent for as little as $80, and as much as $200. But that is exceptionally rare.
I went into the building where this condo is located, and there are two ads on the bulletin board for parking spaces, both asking $150.
How can you make claim (or suggestion) that a person rent out a parking space for $200 – $300 when they’re going for $150? What’s stopping this person from saying $200 – $400?
But that’s not even my main issue; just the issue we finished on.
My main issue is that this “owned” parking space is not owned.
Read the caption – the condo owner put down a deposit on this space, meaning maybe $5,000 of the $25 – $30K that it cost.
This, in my mind, is a blatant misrepresentation.
The asking price of this condo is likely based on a 1-bedroom condo with a parking space, but there IS no parking space!
The parking garage has yet to even be built, first of all.
But more importantly, this is really just an “option” to buy a space.
That $5,000 deposit on the parking space (assuming it’s even that much) is like the cost of buying a put or a call option in the stock market. That merely gives the owner the right to purchase the space, which is likely $25,000.
So really, under “parking” it should read “one-fifth of a space.” Because that’s all you’re buying.
The caption “Parking Spot Is Likely To Have Appreciated In Value” is a little silly as well, since we’re not being given any numbers to work with, nor would the listing agent likely fork over the purchase agreement for that space. How can you back that up with stats?
At the end of the day, the seller (via the listing agent) is making a misrepresentation, and attempting to sell something that he or she does not own.
Make no mistake – there is no parking space here, but the sellers are representing that there is one.
And why is the truth hidden in the “secret” remarks for brokerages?
Who are they trying to fool?
This should be one of the first things listed in the MLS description. Why try and hide it? Do they really think that somebody is going to go through all the steps necessary to buy this condo without discovering that there is no owned parking space, and the purchaser has to come up with another $20,000 to close the parking deal?
And when you think about it, that’s really what this is: an obligation. Sure, it’s a right to buy the parking space, but unless you can walk away from the deposit, the new buyer is on the hook for $20 – $25K once 399 Adelaide Street is finished and the parking deal closes.
Maybe I’m overreacting; it certainly wouldn’t be the first time.
I just don’t like misrepresentations in listings, especially when the truth is being deliberately hidden from the general public.
Why lie when you know you’re 95% likely to get caught?