Toronto
icon-arrow
icon-magnifying-glass

Blog

Real Estate Listing Lies

Real Estate Listing Lies

Author: Tracy Ruddell

Author

As a buyer, how many times have you viewed a property that’s nothing like the listing described? For sellers, have you ever felt pressured on a listing strategy that didn’t feel right for you?

Just because we’re a team of Toronto REALTORS® who make our living buying and selling homes, doesn’t mean we support an “anything goes” approach. We’re just as frustrated as consumers with skyrocketing prices, supply issues and shady tactics used by some listings agents. While unprofessional REALTOR® behaviour is, thankfully, not exhibited by the majority of Real Estate professionals, unfair and even illegal things are happening and it hurts fellow REALTORS® as well as consumers.

 

 

The Top Toronto Real Estate Listing Lies to Watch Out for

Today, we want to smash some of the most common listings lies. These are things you’ll see printed in some agent’s marketing materials and even perpetuated by the media. While most of these are mild untruths in comparison to the big issues like Real Estate fraud, they’re very common and can be dangerous. Don’t get taken in by things that sound impressive but are meant to manipulate consumers.

 

Sign With the Listings Agent & You’ll Get the Inside Track

We’ve talked before about how we feel double-ending in Real Estate should be banned and how important it is to find an ethical REALTOR® who has your back. If you’ve ever gone to an Open House, you’ve had to sign in on the sign in sheet that asks if you have representation. The listings agent is using this to cultivate new business and will try to get you to sign with them. If you’re interested in bidding on one of their listed properties, that puts you in a potentially harmful position where the REALTOR® can never put your interests above the seller's.

The two things you need to know are that:

a) the listings agent is getting the full 5% comission (or whatever's been negotiated with the seller) if they're working both sides of the deal (so they're obviously motivated to close the deal and an unscrupulous agent will do so even when it's not in your best interest)

AND

b) they'll never be able to be as honest and forthright with you when they're also protecting the interests of the seller, their original client.

Our advice is to always get your own representation.

 

Sold Over Asking

Not a listing tactic, rather a sales ploy to generate new seller clients. This phrase is totally meaningless in today’s Toronto Real Estate market. A large percentage of homes are under-listed and so, of course, they’re selling well-over the list price. When agents market themselves with post card drops flashing “sold for 150% of list!” what they’re not telling you is that’s probably fair market value.

In other words, "sold over" isn't necessarily indicative of special, super-hero selling powers that they have over other agents. Take it with a grain of salt.

 

Low List Prices

List prices haven’t exactly gone the way of the Dodo but comps are still king. As a buyer, due to the sheer volume of under-listed properties, a review of comparables and hiring a local area expert to be your REALTOR® will give you far better insight as to what price you should offer on a home than the list price ever can.

There are so many properties listed at several hundred thousand dollars below what they’re worth / what they will sell for that we might as well start listing properties at $1. In fact, a few agents have tried that. What we have now is an auction model for selling homes where bids start low and rise with each additional bidder that comes to the table on offer night.

Have a read of our previous post on List Prices for further info.

 

Published Offer Dates

Like list prices, it’s not that offer dates are meaningless. Most sellers still wait until their published offer night to accept offers as they know that getting competing bids should result in more money. However, this is no guarantee that a seller won’t entertain bully offers.

We talked about this in our review of January’s Toronto Real Estate Market: a home with a hold back date for offers may still sell to a bully offer before that date. Sometimes, it sells on the very first day of list. Fair? Sure, it’s a free market and it’s a seller’s prerogative to take the offer they want. Frustrating? Hell, yes.

What should happen in this case is that every buyer who’s booked a viewing should be made aware that a bully bid is being reviewed, giving them the chance to bid also. This essentially just pulls the offer date forward. This doesn’t always happen, though, and even when it does, if you haven’t made a booking yet through your REALTOR®, waiting instead to see the property over the weekend when you have more time, you’ll be out of luck.

Our advice? You need to get in to see properties you’re interested in on Day 1 of list, in the morning whenever possible. Make sure that the listings agent (through your REALTOR®) is aware of your strong interest and that you want to know if any bully offers come through. It’s still not a guarantee but an ethical listings agent should inform all interested parties of bully offers. If you’re constantly waiting to view hot properties on evenings after work or weekend Open Houses, you'll find that some get sold firm before you’ve had a chance to view them.

 

Open Houses

It’s almost never necessary to have an Open House in this market to sell your home for its maximum possible price (at least in Toronto-proper). If your home has been staged and photographed properly and it's located in a hot area, interested parties will make an effort to view it ASAP and certainly come before your offer night.

It’s true that an Open House can create an emotional frenzy (i.e. bidders seeing dozens of potential buyers amped up about the property) but seeing a hundred business cards of all the visiting agents left out on your table has a similar effect. What Open Houses are really for (beyond nosy neighbours) is generating new leads for your REALTOR®. Your agent uses those sign-up sheets and conversations on the day to identify unrepresented buyers who they can try and woo.

Is there anything wrong with this? Not at all, unless you as the seller have a strong objection to it. Just don’t buy the argument that it’s necessary in order to sell your home (at least, not in this current market) if it’s something you’re not comfortable with.

Now, when the market isn’t hot, Open Houses are a very useful tool to drum up street traffic. But this is a hot market. Red hot. List it (or more accurately, list it properly) and the people will come.

 

# of Beds & Baths

Ever tour a home that was marketed as a 3-bedroom only to find the third “bedroom” is a den the size of a closet? Or a 3-bath home where the extra bathroom is just a powder room? Agents should be listing these as +1’s versus full bedrooms (½’s versus full for bathrooms) but most people want a 3-bedroom house, for example, not a 2+1. So, some will push the boundaries with their MLS listing descriptions.

This kind of stretching of the truth is more than just frowned upon the industry. Buyers and their agents can report this misuse of MLS to the Real Estate Council of Ontario who are the provincial “watch dogs” of the industry. Still, it doesn’t seem to stop some unethical REALTORS® from padding their MLS listings with tall tales to drive extra viewings.

Is this the kind of fib that hurts consumers? Not in the way some of the above dirty tactics can but it does waste your time. And when buyers are having to take time off of work to jump on new listings on Day 1 of showings to get ahead of potential bully bids, this is enough to turn buyer frustration into downright anger.

 

“Fully Renovated”

This is one of the most overused phrases in listing descriptions. What exactly is “fully renovated”? A lot of times, this just means cosmetic renovations and there are no guarantees that what’s behind the walls is updated and sound.

If you’re bidding on a renovated home in Toronto, particularly if it’s a quick flip, push for details on mechanical, electrical, plumbing and structural updates. All homes renovated above-the-board will have permits and sign-off by a City Inspector so you can always request the documentation. Think twice about bidding if a seller won’t disclose their permits and Inspector sign-off's.

Same goes for over-use of words like “luxury” and “new”. A “new” roof may be 3 years old. A “luxury” kitchen may be a 10 year old, Home Depot special but new granite countertops were added before list. Take sales-speak with the appropriate amount of healthy cynicism and push for the facts.

 

Any Agent Will Do

Most REALTORS® are jacks- and jills- of all trades, i.e. they’re generalists who really aren’t doing much more than taxiing you around to viewings and pulling MLS comps for you to review together. Anyone unqualified, inexperienced agent who tries to tell you Real Estate is easy and low-risk is either lying or they’re super lucky not to have caused a major legal screw-up yet. And you don’t want to be their first big mess.

Buying a condo is different than buying a freehold home, just as buying in Markham is different than buying in Etobicoke. This is something we feel really passionately about. So much so, we’ve built our entire brokerage model on having three separate (yet integrated) teams that deal with individual property types–freehold houses, condos and loft–with Neighbourhood Experts within each team.

Whether it’s with us or another Realty team, there are some fantastic agents out there who are experienced, ethical and have helluva good negotiation skills. You want that kind of expert on your team so don’t just hire a family friend REALTOR® to be nice. Do you research to find the REALTOR® who’s the best match for you.

 

Join us again later this week when we'll look at another, whopper of a Real Estate lie that some listings agents use to secure your business. It's known in the industry as buying a listing.

 

Lead image © Ken Tannenbaum from Shutterstock.