THE DEVIL IS IN THE DETAIL
The province announced this week that most of Ontario will be entering Phase 3 of the re-opening of our provincial economy. That’s good news, right?
The expectation is that this is good news for all of us. It means that with the exception of sporting events, casinos and groups over 100, we have ‘earned’ more freedom to shop, dine and gather.
Let’s be clear – I am not one of those people advocating personal freedom over masks and social distancing. For the most part, I think Ontario and Canada have fared better than most other countries when it comes to flattening the curve.
My fear is that a lot of people will now take this as a broad permission to get back to “normal” or how life was in early March.
Let’s not kid ourselves. The world, and how we interact with each other, has permanently been altered. A lot of people and businesses have pivoted and adapted to a new way of life and doing business. It’s not like we had a lot of choice. That said, some of the changes and innovations, particularly in the real estate industry, are for the better and the long term viability of the industry.
Let’s start with the public open house.
Prior to the pandemic, open houses were probably the top “marketing” tool most Realtors were using to demonstrate to their sellers that they were working. Having 20 or 30 people through your Saturday or Sunday open house was viewed as a success.
The myth is that open houses are needed to sell homes. The reality is that an open house is a marketing tool for agents to find new clients. The odds of selling a home from a public open house are in the low single digits. They are designed as a lead generation tool above all else; secondarily, they are used to show the homeowner the agent is actively working, and – knock on wood – maybe a buyer materializes for the home in the process.
If you need ‘proof’ that open houses don’t sell houses, the numbers don’t lie. Since mid-March, the province has prohibited public open houses. Sales in June and the first half of July are running ahead of last year; case in point, this past week’s results are summarized below and accomplished without public open houses.
Most serious home buyers start with an online search. Listings today have multiple photos of the property in fine detail, floor plans, video slideshows, and even 3D models of the home are utilized to demonstrate and promote a home in detail. Today’s buyers can ‘view’ homes from the safety of theirs – and, at their own pace.
As a brokerage we endorsed the prohibition of public open houses and fully supported our team in their efforts to present homes in the virtual space. The feedback has been positive: buyers like the detailed online tours, and sellers love the fact that strangers weren’t rummaging through their homes during a pandemic. Even the Realtors have had positive feedback, as they regained some control of their calendars and personal lives.
It took an investment in technology, a willingness to learn new skills (Zoom calls, online presentations, and digital form-signing, to name a few), and being forced out of a comfort zone. Savvy homeowners realize now that the agents bringing a mix of technology and a solid marketing plan are going to get better results over the agent that thinks public open houses are the pinnacle of marketing.
Much like the province moving onto Phase 3 of reopening, there are changes that must be accepted, new ways of doing things, and yes, attention paid to the fine details. Rushing back to the “old” way of doing things is a recipe to invite the virus to rampage again. We don’t have to look far or too hard to see what happens when we don’t pay attention.
Real estate is not for the faint of heart. It is all about paying attention to the fine details. Dealing with contracts, the negotiation process, and the emotions of our clients are not arenas to be cavalier or inattentive. Much like a pandemic, if you lose focus for the short term, you end up paying a very high price.
THIS WEEK IN THE GUELPH REAL ESTATE MARKET
A pretty incredible week for the Guelph real estate market, with 73 homes reported sold. That is an incredible 43% increase in homes sold over the same week in 2019! 64% of the homes sold went at or above list price, which helped contribute to Sellers receiving 100.02% of their original list price. Insane numbers this week, and even more so given we are still dealing with a pandemic-hammered economy. All the more reason to believe these market conditions are not sustainable and will likely be short lived. September and October are the months to watch.
The median home sold this past week was 3 bed, 2 bath 1,460 sqft, selling for $607,000 (or $410.96/sqft) and took 10 days to sell. As mentioned above, Sellers received 100.02% of their original list price.
Compared the same week in 2019, where we reported 51 properties sold in the Guelph, Guelph-Eramosa and Puslinch Townships. Of those 51 sales, 17 or 33.33% sold at or above list price. The median home sold then was: 3 beds, 2 baths 1,499 square feet, selling for $550,000, or $388.03/sqft. That home took 19 days to sell and sellers were getting 98.81% of their original list price.
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