Heather Hartt, real estate expert
bidding warscanada
(Jun.26.07)
Zahava B. of Toronto, Ont. emailed us at asktheexpert@sweetspot.ca: How do we create a bidding war situation for our home?
…and our real estate expert, Heather Hartt, answered:
A “bidding war” usually results in a home selling for higher than the listing price. For this multiple-offer situation to occur, many different factors come into play, including (but not limited to) market conditions, timing, supply and demand, location, condition of the home and most importantly - pricing.
A home will most often sell for over the asking price when it is priced at, or slightly under, market value. As a seller, it is very risky to rely on a bidding war for the desired sale outcome. It is impossible to guarantee a bidding war will occur, even in the "hot" neighbourhoods. Therefore, it is dangerous to purposefully underprice a home in anticipation of generating multiple offers; if the home does not generate a bidding process, the sellers can be left with a very disappointing result.
My suggestion when meeting with sellers and determining the desired end result is to price the home properly at market value. Sellers and their representatives should choose a price that makes sense given the previous sold statistics for the area. If only one offer develops and the home sells within a small percentage under the listing price, the outcome would be favourable to the seller.
Timing is everything, and if the market conditions and various contributing factors align, then it is possible that a bidding war will ensue and result in an extremely favourable outcome for the sellers. But a home is one of your most important assets. Why gamble with an unsure payoff?
Heather Hartt is a top producing Sales Representative with Harvey Kalles Real Estate Ltd. www.heatherhartthomes.com