Do you play golf?
Are you familiar with the term, “Take your medicine?”
I’ve known my friend Jeff since I was 5-years-old and he was 3-years-old. He was my brother’s friend in daycare, and since I had trouble making real friends in my formative years, I basically took all of my brothers’ later in life.
Two summers ago, Jeff told me that he took up the sport of golf, and before our friend Chris got married that July up in Minden, we snuck in a round in Beaverton, Ontario along the way.
Jeff talked a blue streak about golf, both the sport itself and the PGA Tour, and his love for the game.
I was excited to play with him! I don’t think we had played together since high school!
On the second tee, Jeff sliced his ball into the trees, and I asked him, “Do you want to hit provisional in case you can’t find that?” He declined, and we drove up the fairway.
Amazingly, Jeff did find his ball! The trees were fairly spaced out, and his ball was laying flat on some hard-packed dirt.
“What do you think?” Jeff asked me.
“Take your 5-iron,” I told him, “Close the face, raise the club only as high up as your knee, and smack down on the ball so that you drive it into the ground about ten feet from here, and it should roll right back into the fairway.”
Easy plan. And because of the angle of the trees, he wouldn’t be just chipping out, he’d actually be able to advance the ball about 15-20 yards toward the hole, so not a total loss.
Jeff raised his finger to his chin and remained deep in thought, before he said, “Naaah,” and proceeded to pull out his 3-wood.
“Jeff, this is how a bogey turns into a quad,” I told him. “Take your medicine!”
The difference between an ugly amateur golfer and an amateur golfer who can regularly break 90 is demonstrated on decisions like these.
“Don’t worry, I got this,” Jeff said.
Jeff swung at the ball as hard as he could, and the ball smacked into the trunk of a tree, and went out of bounds. He then had to take a penalty and drop within two club lengths of the fence, but now he had zero angle, and had to go backwards. This time, he hit another tree, and the ball went further back.
Jeff scored a nine on the hole.
We got in the cart on the way to the third tee and I said, “Jeff, sometimes you just have to take your medicine.”
It’s a golf saying that everybody knows.
And it’s quite applicable in the current real estate market too.
Over the past two weeks, I’ve fielded six calls from prospective sellers, most of whom refuse to acknowledge market conditions, market prices, or where we are as a world and a society in September of 2020. The level of wishful thinking is absolutely off the charts, and I don’t know that I’ve ever seen anything like it.
Through sixteen years, I have never turned down so many listings, and I say that not to be braggadocious but rather to demonstrate a problem that exists in our market.
Last week, I received a call from a prospective seller who said she was interviewing agents and asked if I would like to be considered. She told me that her condo was worth $700,000, but in looking at sales for the identical units, I saw that one had sold in May for $650,000, and amazingly, one had sold in August for $690,000.
She said she wanted to list around Thanksgiving, and I said, “So you’d be looking at about $670,000 then?”
She said hers was a $699,900 list.
I wasn’t in the unit that sold for $690,000, and it certainly looked like a price-outlier. But regardless, it wasn’t prudent to pick the highest sale ever recorded, and then add to that price, given our market, and given the listing would be coming out a month later.
“But you haven’t even seen my unit,” she told me. “How can you be giving me instructions on pricing?”
I explained, “Because I know the market out there, and there are eleven listings in your building right now. Buyers only care about price per square foot and comparable sales right now.”
I agreed to come to see her place, and the last thing she said was, “My condo doesn’t need staging. It’s ready to go. You could photograph it tomorrow.”
I’ve heard that one before.
The first thing I saw at the property when she opened the door was a really large and fluffy cat. There’s nothing wrong with that, right? People like pets? People like cats?
Yes. But remember that my way of listing properties is to perfect them, and that means no pets during viewings where we can, and certainly not a large fluffy cat, in a 700 square foot condo, that has a friend – the second cat. Yes. Two large, fluffy cats, and all the hair, dander, and litter that comes with them.
I walked inside, and I sighed internally.
There was nothing about this property that said “Ready to go.” This property was what we call “a complete stage,” in the same way that we refer to homes in poor shape as “a complete gut.”
This is a 3-year-old condominium, very modern, with a very young demographic.
In the spirit of having nothing to lose, I was exceptionally direct and blunt with the seller. I’ve made it my mandate going forward not to sugarcoat things, not to let sellers be self-guided by their hopes and dreams, and not to risk offending somebody with the truth.
I commented, “You said on the phone that your condo didn’t need staging?”
She said, “Well, what, if anything, would you want to remove and replace?”
“All of it,” I said.
She didn’t look happy. So I explained.
“You have some nice pieces in here, like this antique wooden cabinet,” I told her. “But this doesn’t ‘go’ in a modern condo, and it’s way too big.”
She said, “My friends come over and they marvel at my that piece. They love it. They ask where I got it.”
“But how old are your friends?” I asked her.
I explained that this is a 3-year-old condo and the buyer would likely be a younger person, on account of the price, location, age of building, and just the mere fact that most downtown condo buyers are younger.
“It looks like a woman in her 50’s live here,” I told her. “And we need to change that.”
She was a woman in her 50’s, of course. Also one with two cats, old furniture, and a dark condo that she wanted to sell for 105% of fair market value in an extremely difficult market, in a building with fierce competition.
So I didn’t let up.
“Would you be open to painting?” I asked.
“I just painted,” she said.
“And you chose brown?” I asked.
“I suppose you want to paint it white?” she said.
“Yes, I do. Benajmin-Moore, CC-40, ‘Cloud White.’ It’s the colour that I paint all my listings. Usually fifty per year,” I explained.
“Well, I don’t like staged condos,” she told me. “I think they’re stupid.”
Then the true problem revealed itself as she said, “I look at a staged condo, and I can’t see myself living in it.”
And there was the rub.
I explained the concept of staging to the home-owner, and tried to convey that it doesn’t matter if she can see herself in the space, since we aren’t selling the condo to her. We’re trying to cast the net as wide as possible and appeal to the masses. Having a professional designer empty the condo of very personal and out-dated furniture, and bring in new, sleek, modern furniture, and add accessories and lighting, is how to showcase the property in the best light – especially with all the obstacles at hand.
She wasn’t moved.
“Well, I’m not staging,” she said. “No chance.”
She continued, “I’m simply going to give an agent of my choice a 60-day contract and wait until I get my price.”
Therein lays yet another rub, as I explained.
“You don’t need sixty days,” I told her. “There’s an inverse relationship between days-on-market and potential sale price. If you don’t get an offer on this place in the first 4-5 days, you have no chance at getting your list price. If you’re on the market for thirty days, you’re reducing $20-$30K.”
I explained that I still didn’t think she had a hope in hell of getting $699,900, and that if she sold for $670,000, she would have essentially won the lottery. It’s right in between a May comparable of $650,000 and a really odd and hard-to-believe August sale of $690,000. And with the market adding 100-200 new listings in C01/C08 every day, it didn’t seem like November would be any better.
“I’m not going to list for $699,900,” she interjected. My ears perked up. “I”m going to list for $649,900.”
Oh, well. That came out of nowhere.
“So, with no offer date?” I asked.
“No, offer dates are stupid,” she said. “I’ll list at $649,900 and have offers any time.”
“That changes things,” I told her. “I thought you were holding out for like $690,000 or something!”
Amazingly, she said, “I am.”
I didn’t understand.
“But you said you weren’t going to set an offer date though!”
“I’m not,” she said. “But if somebody offers me, like, $630,000, I’ll just sign it back at $695,000.”
This was quickly becoming absurd.
“Value aside,” I explained, “If you list a property at $649,900 with no offer date, and advertise ‘offers any time,’ you’re going to signal to the market that you’re looking for $649,900. And if you sign offers back $50,000 higher than your list price, people are going to pull their hair out. They’ll just walk away.”
She shrugged, and said, “Well, that’s what I’m going to do.”
I told her that it was nice to meet her, thanked her for her time, and went on my way.
Any agent who takes this on, without de-cluttering, without staging, and with an owner working from home with two cats, at an inflated price, is doing the seller a disservice by effectively letting them hit a 3-wood from trees, rather than helping them chip out into the fairway.
I’m aware that my critics will suggest, oh, I dunno, say that I’m only after a quick sale, or I don’t like being told ‘no,’ or something else that seeks to make me the enemy. But I’m hardly guilty of being dishonest here, and I pride myself on telling it like it is.
For a seller that needs to sell, a real estate agent who allows the seller to put him or herself in a bad position is not doing the job. And all over the city right now, there are agents who are too afraid to simply tell sellers, “Take your medicine.”
This listing will hit the market in the worst possible shape and simply sit, getting stale, racking up days-on-market, and will eventually get lost in a sea of inventory.
Buckley’s tag-line used to be, “It tastes awful, but it works.”
For those who need to take their medicine in certain segments of our Toronto real estate market, truer words could not have been spoken…Back To Top Back To Comments