Happy Friday, folks!
While I have a very lengthy and somewhat contentious blog post lined up for next week, let’s first take a look at some stories from the week that are now in the rear view mirror…
The Weird Gets Weirder
It’s a difficult market out there and many agents don’t know how to work within it.
But can you blame them?
Some of them haven’t seen a market like this. Others are brand-spanking new. Then some can’t work within the market because they’re not actually agents.
Wait, hold on. I’m like the Boy Who Cried Wolf here. You know how, sometimes, I like to exaggerate and describe the fly-by-night agents as “not really being agents?” That’s not this. Let me explain…
Last weekend, I was paged on a Friday night to call an agent about a listing. An Agent. That’s what the page said.
I called the number provided but it went to some woman’s voicemail, and the agent was a man. Weird. I didn’t leave a message, thinking perhaps it was a wrong number.
On Saturday, I received another page to call the same agent, with the same woman’s phone number.
I tried the number again, literally minutes after I received the page, but there was no answer.
Moments later, my phone rang and the call display was that woman’s number, so I answered.
“Hello, um, this is Manny,” the man said. “I’m an agent and I have clients interested in your listing.”
He went on with some preamble which, although unnecessary, is perhaps a good way to build rapport.
“The house is beautiful,” he said. “My clients aren’t super fussed on specific location and they can do this pocket here or they can go north or south of the main road,” he explained. He went on to explain that they need four bedrooms, they really wanted a garage (which this house didn’t have) but he was able to convince his clients that the house was worth pursuing even without the garage.
He asked about the closing date, the rental items, and the inspection.
But really he was just buying time to ask about the price.
It’s sort of like, as my father explained, how you bought booze in the 1960’s when you were 18-years-old.
“Lemme have a pack of Chiclets, some mouth wash, that black comb, a six-pack of Miller Lite, a tube of that hair paste, and a safety-razor, please.”
Except as my dad explained, a savvy shop owner would put all those items on the counter, ring them in, and then say, “I just need some ID for the beer, please.” Oh, how many times did the boys walk out with all that pharmacy crap that they didn’t need?
In any event, I said to the agent, “Look, you’re angling toward price right? You want to ask about price?”
He stuttered and said, “Oh, um, well how is it going over there? What’s the interest like?”
I said to him, “Look man, in this market, transparency is important. You want to know about price? Just ask me about price.”
He said, “Well, my clients are on a budget. I’m just trying to figure out how to advise my clients.”
I said, “What’s the budget?”
He said, “I can’t just start throwing out numbers.”
So I replied, “We’re listed at $1,600,000. We’ve been out on the market for three days. We’ve had lots of interest. So if you’re client’s budget is $1,600,000, then we’re in business.”
He told me, “My clients are looking more around the $1,350,000 range,” to which I immediately shot back, “I thought you weren’t going to ‘throw out numbers’ though?”
He was very quiet.
I told him, “Honestly, I wouldn’t bother showing the property. You’re way off on price and I want to save you the time, as a professional courtesy.”
He then answered, “Well, I mean, I’m just trying to figure out how to advise my clients.”
Again, I told him, “And I would advise them to skip this one as we’re just way too far apart on price. You’re $250,000 under list here, so we’re just not speaking the same language.”
I said, “Good chatting, I gotta run,” and he thanked me for my time.
As luck would have it, we received a notification of a registered offer later that day.
I was very excited, however upon opening the offer on my phone, I was surprised and confused.
The price was fine: $1,575,000. The closing date in November was fine too, and I could deal with the one condition for three business days.
But the name of the buyer?
This guy called me, under false pretenses, lied about being a real estate agent, lied about “having clients,” and misrepresented himself as well as the agent who would eventually submit the offer.
The agent was shocked and embarrassed. Completely stunned.
It didn’t really matter in the grand scheme of things. In fact, it worked against Manny, since he came in way higher on price than he should have.
But it was the very first time in my career – at least that I know of, that a random buyer called me and lied about being a real estate agent.
Weird phone call.
At first, I thought he was just a really bad real estate agent.
But by the time we had finished the transaction, I realized he was just inadvertenly good at acting like a bad real estate agent…
Muhammad Ali Said, “It Ain’t Braggin’ If You Can Back It Up!”
Here’s a story I heard through the grapevine.
A real estate agent has a $14,000,000 listing. This agent is one of the top agents in the city, well-known, well-liked, and I’ve never heard a bad thing said about this person.
Twelve months go by and the property doesn’t sell. The owner refuses to reduce, and the listing runs out.
Another agent gets the listing immediately thereafter, but there’s a caveat: the seller now agrees to reduce to $11,000,000.
The property sells in twelve days.
The new listing agent sends out a flyer advertising: “Listed With Another Agent For Twelve Months. We Sold The House In Twelve Days.”
No mention of the price.
Offside, or fair ball. ?
Selling Half A House?
Attention, real estate lawyers: we’re going to need your help on this one.
I saw a listing last week that looked too good to be true.
Even if you have minimal knolwedge of the market here in Toronto, surely you must see this is a downright steal:
This makes no sense.
It’s a semi-detached, 2 1/2 storey house on an 18 x 123 foot lot, currently set up as a 4-bedroom, 3-bathroom.
Even if this house were in derelict condition, it must be worth more than $600,000.
I mean, if I had to guess, I would think it’s worth somewhere in the neighbourhood of double.
It looks too good to be true, and in this market, that means it probably is.
As you may have guessed, there is an explanation here. But it delves off into the world of “firsts” in that this is the very first time I have ever seen this in an MLS description:
Is that legal?
I mean, it is in theory, and it all depends on the type of ownership.
This comes down to “joint tenants” or “tenants in common,” as a lawyer will more succinctly explain.
We typically distinguish between joint tenants and tenants in common when it comes the death of one owner.
Joint tenants benefit from the “right of survivorship,” in that if one of the two property owners dies, the other one automatically inherits the other half of the property.
Tenants in common own their respective “halves” of the property, assuming each owns the same amount. So if one of the two owners dies, instead of the deceased’s half passing to the other owner, it passes to the deceased’s estate.
In the case of the above property, if there are two owners and the property is owned the two individuals as “tenants in common,” then the one owner can sell her 50% interest.
Could she sell her 50% interest if they were joint tenants? I’m not sure.
Any lawyers in there, feel free to weigh in.
But I’ll say this: I’ve never seen half of a property being sold on MLS before, and I don’t know how in the world the market is going to make sense of this. I also don’t know who in the world is going to buy this…
Moving To London?
Remember the 2022 campaign by the Province of Alberta that sought to recruit Torontonians in need of more affordable real estate?
I wrote about this on my blog a few times last year.
Here’s the article:
“Alberta Is Calling’: Marketing Campaign Calls On Toronto Residents To Move Out West”
September 26th, 2022
The campaign made light of Toronto’s high housing prices, compared them to Alberta’s, and suggested that life was better out west.
“It’s mountain time somewhere,” one advertisement read.
“An engineer, accountant, walk into a province. They all get jobs,” was featured in another advertisement.
These ads were littered throughout Toronto, especially on the TTC.
Ironically, as I posted on TRB in late-2022, the campaign backfired in some ways when people started to come out of the woodworks and suggest that they moved to Alberta and were now moving back to Toronto…
“I Moved To Alberta And Hated Everything About It. After Three Months, I Came Back To Toronto”
December 13th, 2022
In any event, a reader sent me this photo on Wednesday:
Have you seen this?
But I went to the website, www.donttelltoronto.ca, and it’s a very interesting take!
From the home page:
Hello, Torontonian. Look, we love Toronto, too. It has lots of great people, but let’s face it, it’s tough out there. Tough to find affordable living, tough to find a bit of green space, tough to find parking when you need it. We have a lot of great London opportunities at some of Canada’s best employers, and London is a great place to live – green space, backyards and driveways, room for a family and a Great Dane, trails, the Thames River, great music and theatre scene, international cuisine, and a ton of festivals. Your next career can be here – and don’t worry, we won’t tell Toronto if you don’t.
There’s really not a lot to the site other than the above blurb, some quick stats about London, and a form field.
I haven’t been to London since I toured the University of Western Ontario campus in 1998.
So what say ye?
Any takers? Anybody moving to London for greener pastures?
This one is more for the real estate agents who read TRB, but for those of you who watch real estate television shows and want to know what really happens in the industry, you might find this interesting as well.
It’s recruiting season for managers and brokers, and the phone has been lighting up. Many brokerages are having trouble right now, so the thinking goes, “I need more agents! I need new agents!”
Kudos to the brokers and managers for “working the phones,” but what I always find fascinating about recruiting is that, all too often, the company that is trying to recruit you is a far, far lesser brokerage.
For context, imagine a minor-league hockey team calling Sidney Crosby and asking him to come play for them.
While I recognize that, “There’s no harm in trying,” and that “You miss one hundred percent of the shots you don’t take,” I find the efforts to be so incredibly misplaced.
I was called this week on behalf of an agent who I have never heard of, working for a brokerage I have never heard of, but the agent himself wasn’t calling me. No, he had outsourced this to a call centre which was clearly in another country. After the call, I looked the agent up in a third-party system we have that lists all Realtor transactions, only to find he has completed four transactions in the past twelve months. And he started his own brokerage? He’s trying to recruit seasoned agents?
It’s just so odd.
We were in our team meeting this week and Tara’s phone rang. It was a recruiting call from – again, a brokerage we had never heard of. She politely declined, and then five minutes later, Matthew’s phone rang. He smiled and showed us the Caller ID. He let the call go to voicemail, and then three minutes later, Chris’s phone rang! This broker was clearly working down a list, but never stopped to think that agents who work together might actually be sitting together at the time of these calls?
I’ve seen a lot of experienced agents decide that they don’t want to work and grind anymore, and who try to start their own brokerage and recruit. It’s not working. And it’s not going to…
Not The One?
I have written countless blog posts on the perils of pre-construction condominium “investing” over the years, dating back to the very inception of this blog in 2007.
A few years ago, I started to call on the actual buyers of the pre-construction condos to take accountability and responsibility and acknowledge that investments carry risk. I argued that it was time to stop questioning “Why did this condo project fail?” and start asking the question, “Why did I invest in this, and did I understand the pitfalls?”
Case in point:
January 22nd, 2021: “The Friday Rant: Hate To Say I Told You So”
This, of course, refers back to the original cancellation of a project called “MUSEUM FLTS,” which we should have known would fail, since they didn’t have enough money for the missing “A” in “FLATS”.
Here’s that post:
November 13, 2017: “Another Pre-Construction Condo, Cancelled. Who Is To Blame?”
And yet here we are, six years later, and buyers of a failed project are still complaining and asking all the wrong questions.
Most of you read this story, I’m sure:
“Frustrated Buyers Want Out Of The One Condo Project – But Can’t Get Refunds Or Complete Assignment Sales”
October 24th, 2023
It reminds me of the time that I bought shares of Nortel Networks for $50 per share, and when they went down to $35 per share, I said, “I want out.”
I wanted my money back.
All of it.
But of course, that’s not how a market works, nor is it how investing works.
And in actual fact, I didn’t ask for my money back, because I was logical enough to understand the risks of making a bet on a stock.
The buyers of condos at “The One” knew that, or at least should have known that.
So to see them line up to complain to whichever newspaper reporter gives them a forum is very, very disappointing.
I thought we were past all this?
There are risks to pre-construction investing. Many. It’s why I have never sold one in twenty years.
And these investors shouldn’t just be worried about getting their deposits back today, or in a timely manner, but rather they should be worried about losing a large percentage of it.
I didn’t want to touch this topic today, but so many people have emailed me the article or asked for my opinion.
I’m sure this won’t be the last we hear of “The One” and I have to wonder what will come first: the registration of this condominium after completion, or the year 2028…
Have a great weekend, everybody!