Welcome to my comprehensive, “Everything You Need to Know” Guide to selling your house in Toronto in 2018.
In here, I’ll cover:
- Real Estate Market Trends
- Toronto Neighbourhoods
- Interest Rates
- Personal Life & Schedule
- Market Seasonality & Competition
- Posting Online at the Right Time
- Choose the Brokerage
- Find Out Their Specialty
- Read as Much as You Can
- Understand the Listing Agreement
- Prepare for Paperwork
- A Real Estate Cheat Sheet for Tailoring your Target Audience
- Infinite ROI
- Variable ROI
- Low ROI
- Writing a Great Listing
- Print Materials
- Managing a Strong Showing
- High Tech Visuals
- Online Advertising
1. How to Use Toronto’s Fast-Paced Real Estate Market to Your Advantage
If you’ve lived in Toronto for any amount of time, then you know one of Torontonians’ favourite pastimes is to talk about the real estate market.
It’s no wonder why – we’re breaking real estate records left, right, and centre. And now, we’ve seen the effects of multiple rounds of legislative changes on a hot market.
All of this – the records, the reports, the new laws – affects the market. So using the state of the market to your advantage isn’t a static, simple task.
But understanding it means you can price and market your home more effectively.
Toronto Market Trends and How They Affect You
Need for housing
Toronto’s population is growing – fast. Between the 2011 and 2016 census, Toronto’s population grew by 6.2 percent, above the national and provincial averages.
And it’s going to continue. It’s estimated that we’re going to add 3.5 million people (that’s more than Toronto’s current population) to the GTHA in the next two decades.
There’s a dire need for housing, both rental and purchasing. This means that the market likely won’t shift into a buyer’s market, and sellers will continue to have an advantage in a competitive buying scene.
Selling a rental property, or converting to a rental property, can have a massive payout in this environment.
It’s all about neighbourhoods in Toronto. The more upscale and established ones – Yorkville, Forest Hill, the Annex, the Beaches, Rosedale – haven’t seen a major drop in their sales prices. There’s a strong market for luxury properties in these areas of Toronto.
In “hot” neighbourhoods, like West Queen West, Liberty Village, and Yonge and Eglinton, rapid construction is contributing to more inventory. This caps their prices somewhat since there’s a decent volume of sellers’ competition in condos and new construction. But demand remains steady.
In “up-and-coming”, soon-to-be-hot neighbourhoods, like the Canary District, the east end, and the Junction, competitive preparation is important. The desire for these neighbourhoods is there, but mostly due to affordability. Creating a perception of competition and luxury can command you a higher price.
Incoming interest hikes
Interest rate hikes sometimes encourage people to buy homes, especially if the public is worried about long-term affordability (which, in Toronto, they are). Nabbing a home and locking in under 3% interest is a powerful motivator for many buyers.
For others, interest hikes may price them out of the market. Luxury homes and those above $1-million, though, are often bought by people with budget flexibility, and so interest rate hikes aren’t a major scare.
Homes under $1-million, especially condos, have their relative affordability buoying sale numbers. Interest rate hikes may keep some of these buyers out of the market. With the population growth, though, demand will continue to outpace supply in the mid-to-long-term.
2. How to Ideally Time Your Sale
Timing your sale isn’t all about market conditions and seasonality. Your timing also needs to make sense for you, your family, and your career, too.
Personal Life and Schedule
Do you have kids in school? Moving during summer break or mid-year probably makes the most sense for you and your family.
Are you worried about a period of unemployment, or other financial shifts? It might make sense for you to downsize sooner rather than later, especially if compounded by interest hike concerns.
Ultimately, you know your schedule and your family best. Since, in Toronto, buyers are available year-round, selling on your schedule should be your top priority. Extended closing periods can be negotiated.
Market Seasonality and Competition
The hottest times in Toronto real estate (read: the most buyers and the most sellers) are the Spring and Fall markets. Slow periods include vacation and holiday times, like July to August, and mid-December to late January.
Similarly, there’s a hot period right after Labour Day, and sometimes after the winter holidays.
This doesn’t affect sales prices as much as you might think. Even in the worst kind of weather, at the slowest time of year, people need to buy – for new jobs, for growing families, for investments.
If your home is less-marketable (read: needs a lot of work), in a less trendy neighbourhood, or in an area with a lot of inventory at high times, selling during a slow period (less inventory) may be to your advantage. In other scenarios, high time is a good time.
Posting Online at the Right Time
Timing your sale has become a lot more about what day and time to post information online, instead of what season to list in. Listing information online comes in the form of social media, promoted social ads, and the listing itself on Realtor.ca and MLS.
Postings on weekends get the highest traffic, according to Coschedule. The most views and click-throughs come before noon on weekends, and so posting just before is ideal.
Many people choose to get listings that fit their parameters sent automatically to their inbox in the morning, which means you want to post before these emails go out to get in their inbox on weekend mornings. Listing just before the weekend starts can be the best time to get prime weekend email views.
Since Thursday and Friday evenings are hot scroll times too, posting on a Thursday or Friday just before rush hour is a great time for generating organic listing traffic and capturing commuter eyes.
Of course, the only way to know what really works best is to measure different times and see what works. An experienced agent with a strong digital presence should know their analytics and be able to tell you about their posting and listing strategy.
3. How to Hire the Right Agent
Here are some interesting facts you need to know when looking for a real estate agent:
- 57% of Toronto real estate agents sell 3 or fewer houses/year
- 49.3% of Toronto real estate agents have done 1 or zero transactions in the last year.
- The number of real estate agents in Toronto doubled (from 20,000 to 40,000) between 2004 and 2014.
This makes it especially difficult, but increasingly important, to vet your real estate agent carefully before hiring them. Many agents have little experience, are new to the market, or are even working part-time as realtors.
Choose the brokerage
Just like not all agents are the same, not all brokerages are the same. Large, high-volume brokerages specialize in efficient sales and turnaround times. Smaller brokerages likely have a specialty, like luxury homes or a local neighbourhood.
Freeman Real Estate Ltd., my brokerage, specializes in “character properties” in Toronto. Edwardian / Victorian homes with lots of charm, converted lofts in historic buildings, and “lifestyle-matching” these unique properties to the families that would love them.
That’s what my business has been all about – which makes Freeman the perfect fit for me and my clients.
Find out their specialty
Most real estate agents have a specialty. If your agent can’t name one, then they probably don’t have that many transactions under their belt.
Me? I work most often with families, academics, professionals, up-sizers and down-sizers, especially those looking to move to my neighbourhood of Seaton Village/Christie Pits.
I have a bit of a thing for my local area when it comes to real estate. You won’t just see my name on “sold” signs around the area, you can find me at community fundraisers, local BBQs, on bike rides with my family, running hills in Christie Pits or walking to the pool or skating rink with my kids.
Review as much as you can
A lot of being a real estate agent is about marketing. Strong writing skills, a modern digital presence, and good photography on an agent’s site often – but not always – means that they do these things well for clients. They care, and they pay attention to the details.
On the flip side, a lacking online presence, poorly-written listing copy, and a confusing business presence mean that the agent might not be organized or digitally-savvy. You can find out a lot about a team from their site! Dig in and find their Facebook profiles, their Instagram/Twitter accounts, or their personal websites.
Understand the Listing Agreement
When you sign a Listing Agreement, you’re actually signing a contract with the brokerage, not the agent (another reason why you should choose the brokerage!).
The Listing Agreement gives your listing agent the authority to act on your behalf, while also legally binding them to only act on your behalf. This is called a fiduciary agreement.
Read the Listing Agreement carefully, you are allowed to negotiate! Take the time you need, and if an agent rushes you through or refuses to budge on minor details, take their advice with a grain of salt.
Documents You’ll Need While Selling Your House in Toronto
A survey is a drawing that shows characteristics of your property. It includes topographical features such as trees, creeks, or hills, and structural details.
Rental Leases, if applicable
If you currently house a tenant, ensure you have a copy of the rental lease handy. If you have lease agreements for your furnace or hot water tank, we’ll need to see those too.
Property Tax Information
Your most recent property tax bill.
Condo Status Certificate
This is a document that provides basic, essential information about the financial status of the condo and the condo corporation. It also contains the condo declaration, bylaws, budget, reserve fund, insurance, management contract, and the minutes to the last annual general meeting.
Recent Bills – utilities and renovations
You should keep about a year’s worth of utility bills, and any renovation plans, bills and warranties.
4. Marketing 101: Your Home has a Target Audience
Many homeowners don’t realize that their home, like any product on any market, has a distinct and desirable target audience.
I, as a real estate agent, often refer to these distinct groups by their situation:
- Young couples
- First-time homebuyers
- And more!
Is your home a small, fifties-era bungalow with a large lot in a recently-gentrified area? Developers would probably love to acquire your property for a 5000 sq.ft. contemporary home.
Do you have a one-bedroom condo in a hot area with lots of tech jobs? Landlords (investors) and first-time homebuyers would be the target.
If you have a Victorian, with a modern-interior, 3 bedroom and 3 bathroom property in the Annex, your target is likely a move-up buyer with a dual-income, and most likely has two or more children.
Knowing your target audience means I can focus my marketing energy and resources into finding them and making them want and need your home.
It impacts how (and if) I stage. It impacts what keywords I pick, who I target on social media, how I frame listing copy, who I send postcards to, and more.
A Cheat Sheet for Tailoring to Your Target Audience
Cite: Land value, population statistics, lot size and zoning information
Cite: Neighbourhood conditions, historical value increases of similar properties, public transit and schools
Cite: “Rentability” (market rents), rental market conditions, average rental prices of neighbouring properties
Cite: Schools, neighbourhood characteristics, family-friendly amenities, groceries, parks, pools, arenas
Young (professional) couples
Cite: Lifestyle, restaurants, hipness, name-dropping, parking, transit, proximity to downtown
Cite: House characteristics and features, value-add, parking transit, walk and ride (bike) score
5. Marketing 102: Bringing Your Home to its Full Potential
Get an Inspection
In many cases, it’s worth it to shell out for a pre-list home inspection. An independent and reputable home inspector will help when selling your house in Toronto. As your Listing Agent, I include this in my all-inclusive service.
If issues show up in a buyer’s inspection report, then you might net a lower sale price. By conducting a pre-list home inspection and getting a head start on repairs, you will ensure your home sells at the highest price.
Consider Your Return on Investment
So we have our target audience. We know why they want your home. How do we maximize your home’s potential so the target audience falls over themselves to get it?
The flip side of the coin: How do you do this without spending a lot? Or, how do I make money from our investment into home preparation?
Maximizing your home’s potential is all about the ROI: Return On Investment.
Infinite ROI: Clean and declutter
Find a storage locker and put your off-season clothes, your extra furniture, your knick-knacks, your china, your books, your small appliances, and everything you can live without into storage.
Then hire a professional cleaner (or choose a real estate agent who does this for you, like me). Clean what they might miss: the baseboards, the walls, the ceilings, the curtains, the windows, the light fixtures. Everything.
A clean and clutter-free presentation make your home shine. It makes buyers think your home has been well-cared-for. It photographs better. It tours better. It just feels nicer.
It is a low- or no-cost investment for an incredibly high payoff.
High ROI: Small fixes
Fix broken drawers, replace missing handles, patch small holes, and paint (or use Magic Eraser) on small scuffs around your home.
When buyers see broken household features, scratched walls, and wobbly bannisters, they think about what else might be wrong with the house. Not fixing these things will yield a much lower price, since it doesn’t feel “move-in ready”.
Fixing and small repairs have a high return on investment for very little money. It’s always worth it.
Variable ROI: Staging
Depending on your target audience (see above!) staging can have a massive impact.
Remember the little bungalow that was primed for developers to snag? Staging that property doesn’t make a lot of sense – I don’t need buyers to imagine themselves living there because our target audience won’t be living there.
But a three-bedroom house in a bustling Toronto neighbourhood? Staging is mandatory! Standing out among hundreds of listed homes in the city means you need to make a memorable impact during your showings. Staging can net you the price you want.
What “look” does your target audience want? What appeals to them? How are they spending their time? Are they Sunday meal-preppers, or Uber Eats customers? All of this impacts how you stage your home. If you’re unsure, talk to a professional or an agent that manages staging for your home (that’s me!).
Low ROI: Remodels
The time it takes to remodel eats into your ROI – although it can be worth it.
Most kitchen remodels, for example, can return about double what you invest, although this is lower with higher-end and expensive updates.
But when you consider the risk factor of investing thousands into a modernizing update that might not reflect your buyers’ taste, or changing trends, full-scale remodels likely aren’t your best investment.
Still, every situation is different. Want to know more about the best investments to make when selling your house in Toronto? Let’s talk!
6. Marketing 103: Balancing Old & New-School Marketing
This is the nitty-gritty of home marketing that not everyone needs to know. If you’re curious about pricing strategies, listing copy, targeted advertising, and 3D home walkthroughs, then read on!
OLD SCHOOL TECHNIQUES
Pricing is Everything
Despite new-school ways of marketing homes, strong pricing strategy is crucial. A well-priced home generates interest and offers, without dropping too low to raise red flags.
What goes into pricing?
First, research. What have similar properties in the same neighbourhood sold for in the last few months? How long did they take to sell? Were the homes listed, taken down, and then re-listed for a different price?
Next, understand the market. In a sellers’ market, homes can be priced higher due to lower supply and competing for demand. Now, with Toronto’s hot sellers’ market leaning more towards balanced, buyers have a little bit more power. Sellers should be careful of pricing for what they could have sold for in Spring 2017 – it’s just not the same market.
Writing a Great Listing
There’s nothing quite like a well-written listing. Listing copy needs to reflect not just the product – your home – but its benefits. Does it offer a cozy, curl-up-and-read family room? A Millennial-friendly minimalist interior?
Listing copy takes the features of the homes and makes them sound desirable.
Believe it or not, creating custom print materials and ads is really common in the industry. For particularly interesting properties or homes with a very niche target audience, I do custom advertising to find our buyer.
Here’s the kicker: Even though the target audience is key, I have a secondary audience: other agents.
Real estate agents still read listing ads in newspapers (real papers, too!). Print materials are sometimes the best way to capture an old-school agent representing an old-school client in their ideal neighbourhood.
Managing a Strong Showing
Showing your home isn’t hosting. Instead of treating a buyer like a guest, they should actually feel like the home is already theirs.
So the number one thing to do is leave the house. Buyers feel less comfortable about exploring, wearing their heart on their sleeve, asking questions, and commenting on features of your home if you’re still there. Take your kids, your dogs, your friends, and go do something during showings. I promise – it’s the best thing you can do.
Ensure your home is the right temperature. Too cold (in winter) and buyers will think it’s energy inefficient. Too hot and buyers start worrying about mould, and hurrying through the showing.
There’s no need to bake or spray anything – scenting may have been common a few decades ago, but growing allergy awareness means that many people are uncomfortable in heavily scented areas. If your home has been cleaned thoroughly, it should just smell fresh.
NEW SCHOOL TECHNIQUES
HDR Photography is the norm, especially when working with a professional Realtor. Great photography shows your home in its best light, making rooms feel large, airy, and bright.
Now, agents and homeowners are trying out new things. Home walkthroughs, like videos or high-tech options, are gaining steam.
This matters. 90 percent of home buyers search online at some point during their home buying process. For almost 50 percent, searching online is the first thing they do. To capture the largest buyer pool and generate as much interest as possible, a convincing visual presence makes all the difference.
Just posting a listing onto MLS doesn’t cut it. Cross-media digital advertising, dedicated websites and online social media posts are also important – I always make sure I’m casting the widest net when broadcasting a new listing.
Social media advertising has taken off in the real estate sphere. Instagram and Facebook ads targeted directly to your home’s demographics mean I can capture eyeballs efficiently. It’s working, too – more people are calling Realtors because of their social media presence, or because they’ve seen a home they love on social media.
7. Understanding Offer Situations
There are a lot of rules when it comes to offers and understanding them is crucial. Things to know:
- Bidders and their agents have a right to know how many offers are on the table
- Offers in Toronto are submitted by email just as much as they are in person. Not everything is ultra-high-tech here!
- Agents must share the details of received offers with their sellers
- “Bully offers” are early, high-value offers by buyers hoping to avoid competition with a competitive, time-limited offer
Up until last Spring, Toronto’s highly competitive market meant that buyers were submitting offers completely void of conditions in order to improve their chances in multiple offer situations. This is still the case today for move-in ready homes in desirable neighbourhoods. However, for sellers in less trendy neighbourhoods or with properties requiring renovations, there is not as much demand, and therefore reasonable to expect the occasional financing or inspection condition.
If you accept a conditional offer, you’re still able to view other offers. Conditional offers, rather than no-condition “firm” offers, aren’t final. The buyer has a set period of time to accept or void their conditions, like financing or getting an independent home inspection.
A lawyer friend once described chattels to me this way; “Pick up a house, turn it upside down, and shake it. Everything that falls out is a chattel”. Everything that doesn’t is a fixture.
Fixtures are included in the real estate property. When you sell your home, you’re selling it with the fixtures.
If there are fixtures you can’t live without – chandeliers, closet organizers, even faucets – try to take them out of the home before you list. Replace them with a cheaper option. Otherwise, you’ll have to specify very clearly in your agreement that you’re taking the chandelier with you.
Most agreements include the request from buyers that chattels and fixtures (things that don’t fall out of the house) are in good working order when the buyer takes possession.
This doesn’t mean that the seller has to promise that everything will be working months after closing. The generally agreed-upon amount of time after closing is about a month.
So if the furnace breaks a few days after your buyer moves in, then you might have to start thinking about repairs.
8. Preparing for Closing Day
What You Need to Do
- Ensure your lawyer has a copy of your deed, mortgage, current property tax bills, and keys, which they will hand off.
- Leave spare keys, mailbox keys, garage keys somewhere accessible, if not with your lawyer.
- Cancel any household insurance policies, and notify your insurer if your house is going to be vacant for any period of time.
- Notify your cable provider, phone provider, and check for your portion of utilities.
- Cancel newspaper subscriptions.
- Set up a forwarding address with the post office.
Ready to sell? Have any questions about selling your house in Toronto? Let’s talk! Send us a message and we’ll go from there. Text or call us at 647-898-4663 or email us at Alex@AlexBeauregard.com