What’s happening out there? I often get asked this question when people realize I’m a local real estate agent in Kitchener-Waterloo. It’s usually followed up with stories about friends and family who either successfully sold their home and are overjoyed with the 5-10 offers they received well above asking price or…. it’s a story of a disheartened first-time buyer who worries they are being priced out of the market all while having money to make a down-payment, ready and willing to buy. Buyers just can’t seem to get a deal together and are losing in multiple offer negotiations.

negotiationsFive Principles When Purchasing In A Heated Market

Or How to Win Multiple Offer Negotiations:

#1) Use a highly qualified Realtor: Your representative should have a track record in the current market conditions. This individual should update you regularly on what homes sell for in neighbourhoods of interest. They should be tracking the average increase on sale price vs. list price. They should be educating you as a Buyer on the market conditions so that when the critical moments of negotiations occur you’re ready to be aggressive. As a rule of thumb, a qualified Realtor completes 20+ sales a year; this means they will have extensive trade relationships with other realtors which can benefit you as a Buyer.

#2) Work with an excellent financial team: Should you require financing, be very clear on the terms and qualifications. Many Sellers are holding offers until a specific day to receive offers; this should allow you enough time to submit the listing to your mortgage consultant in order to receive a firm commitment on the property. The vast majority of residential property currently sells without any conditions from the Buyer. A firm mortgage commitment should allow you to place an offer without a financing condition. Benjamins Realty can refer you to industry leading mortgage consultants who will provide this service.

#3) Be available during negotiations: Your Realtor should either be presenting your offer in person or be available during the offer presentation in order to deal with any questions that may arise. As Buyers you must also be available. The Sellers may end up deciding between two similar offers allowing a chance to increase or change your offer, it could be something as simple as a closing date. The Buyers who display the most responsiveness and flexibility to the Sellers needs, also end up in the strongest positions.

negotiations#4) Be aggressive: When you find a home that you’re excited about, be ready to capitalize. The day of negotiations a game-plan should be formed with your Realtor discussing multiple scenarios based on the level of competition you could come against. As a Buyer, understand that list price typically does not represent a realistic representation of the property’s value. First, determine fair market value with your Realtor, then contrast that against the competition, and finally, balance your desire to secure the property while not paying too far over market value (understanding new value benchmarks are being set all the time).

#5) Sometimes it’s ok to lose: In a volatile market, home value benchmarks are being established at a higher price point almost every month. Even with a good game-plan another Buyer (who has likely lost too many times in negotiations) may choose to pay what is normally considered far above fair market value in order to lock down a property. A common phrase around our brokerage is “there is no shortage of opportunities,” you will likely find a better property.

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KITCHENER‐WATERLOO, ON (April 4, 2017) ––Residential sales through the Multiple Listing System (MLS® System) of the Kitchener‐Waterloo Association of REALTORS® (KWAR) continued their monthly ascent in March with 729 properties sold in Kitchener‐Waterloo and area. This represents a 24.2 percent increase compared to the same month last year, and is the highest March on record.

“This is the first time we’ve seen residential sales come anywhere close to the 700 unit mark so early in the year,” says James Craig, President of the KWAR. “These are exceptionally strong numbers, in fact’ we’ve only surpassed 700 units in a single month three other times: May 2007, and then not again until May and June of last year.”

During the first quarter of 2017, there were 1,532 home sales, 13.4 percent above last year’s result for the same period and 30 percent above the previous 5‐year quarterly average.  On a monthly basis, home sales were 41 percent above the previous 5‐year average for the month of March.

Residential sales in March included 444 detached homes (up 15.0 percent compared to March 2016), 164 condominium units (up 49.1 percent) which include any property regardless of style (i.e. semis, townhomes, apartment, detached etc.). Sales also included 67 semi‐detached homes (up 76.3 percent) and 48 freehold townhouses (up 14.3 percent).

The average sale price of all residential sales increased 32.3 percent to $493,226 compared to March 2016. Detached homes sold for an average price of $583,144 an increase of 35.6 percent, while the average sale price for an apartment style condominium was $265,524, an increase of 25.4 percent. Townhomes and semis sold for an average of $368,554 (up 29.9 percent) and $412,226 (up 49.1 percent) respectively.

Once again in their latest monthly news release, the Canadian Real Estate Association called the disparity between limited housing supply and robust demand in Ontario’s Greater Golden Horseshoe “without precedent”. In Kitchener‐Waterloo, the number of months of inventory has stood at or below one month for eight consecutive months.

Despite the low inventory, Craig notes that people were listing their homes in large numbers last month. “We had 844 new listings processed through our MLS® System in March which is above the previous 5‐year average of 807 for the month of March.” However, due to extraordinary demand, the number of active residential listings still on the market at the end of March was well below normal with only 434 residential properties for sale, way below the previous 5‐year March average of 1,508.

The average days on market in March were significantly shorter than a year ago: 14 days, compared to 35 days. On a month to month basis, it took four fewer days to sell a home in March compared to the month before.

“In the past several months there has been plenty of conversation in the media, in the pubs, and at all levels of government surrounding housing affordability, and it’s a concern I share,” says, Craig.  “Earlier this month the Ontario Real Estate Association alongside the Ontario Home Builders’ Association called on the province to create a taskforce to address home affordability. While homeownership is an investment that has served most Canadians extremely well, it’s also becoming very difficult for those first‐time buyers who are trying to share in that dream and get into the market.”

The KWAR cautions that average sale price information can be useful in establishing long term trends, but should not be used as an indicator that specific properties have increased or decreased in value. The average sale price is calculated based on the total dollar volume of all properties sold. Those requiring specific information on property values should contact a local REALTOR®. REALTORS® have their fingers on the pulse of the market. They know the questions to ask, the areas to probe and what to look for so that you get a complete picture of the property and community you’re considering.

 

March 2017

KITCHENER-WATERLOO, ON (February 2, 2017) ––The number of residential sales in January through the Multiple Listing
System (MLS® System) of the Kitchener-Waterloo Association of REALTORS® (KWAR) increased 5.8% compared to January
2016 and 22% above the 5-year average for January.
There was a total of 327 residential properties sold last month; including 194 detached homes (down 5.4 percent
compared to January 2016), 79 condominium units (up 19.7 percent) which include any property regardless of style (i.e.
semis, townhomes, apartment, detached etc.). Sales also included 32 semi-detached homes (up 128.6 percent) and 20
freehold townhouses (down 9.1 percent).
While demand remained strong in January, the number of active listings was down significantly: There were 367 active
listings at the end of January, compared to 1,068 in 2016.
“The continued strong demand combined with a tight supply of listings means that many properties are not on the market
for very long,” says James Craig, President of the KWAR. “This has created an extremely competitive buying environment.”
The average days on market in January were significantly shorter than a year ago: 22 days, compared to 47 days, and six
days quicker than in December.
The average sales price of all residential properties sold in January was $421,104, a 0.5 percent decline compared to the
previous month, and a 19.1 percent increase compared to January 2016.
Reaching a new milestone in December, was the average price of a Detached home sold through the KWAR’s MLS®
System which for the first time surpassed the half million mark; a benchmark that was repeated again in January, with the
average detached home selling for $501,821, an increase of 22.7 percent compared to the same month a year ago.
In the condominium market the average sale price for an apartment style unit was $237,220 in January, a 2.8 percent
decrease compared to the previous month, and a 17.1 increase compared to the same month a year ago. Townhomes
and semis sold for an average of $323,946 (up 5.8 percent compared to December) and $353,295 (up 6 percent
compared to December) respectively.
President Craig points out that Waterloo region is in high demand. “Getting into the housing market at the moment is not
easy, and buyers need all the help they can get. It is more important than ever that you avail yourself of the professional
knowledge of a local REALTOR® to guide you through these unique market conditions”
The KWAR cautions that average sale price information can be useful in establishing long term trends, but should not be
used as an indicator that specific properties have increased or decreased in value. The average sale price is calculated
based on the total dollar volume of all properties sold. Those requiring specific information on property values should
contact a local REALTOR®. REALTORS® have their fingers on the pulse of the market. They know the questions to ask, the
areas to probe and what to look for so that you get a complete picture of the property and community you’re considering.