Truth In Advertising

Until just a couple of months ago, and for at least the last two years, the listing price of a house only hinted in the most remote way at the amount it would actually sell for. It was routine to see places fetch between one hundred and two hundred thousand dollars over the asking price. The market had lost its head. Reason had put on its metal rain-hat and stormed out the door.Well, those times appear to be well and truly behind us, and the speed of the change in direction has been genuinely shocking. It’s been like watching a truck jack-knife on the 401 and then head gobsmackingly upstream. The average sale price of a house in Canada has dropped about 100K this season (which if it weren’t for rapidly rising interest rates would be great news for buyers).

What’s more, there is usually time written into an offer to sort out financing, and (gasp!) to actually commission an inspection. In the last week or two I’ve even seen agreements that require the sale of another property. Buyers are no longer willing to simply trust on faith that their own house will sell in order to facilitate that next purchase. And sale prices generally end up right around the asking price or, in the case of houses priced optimistically, a little below it. All of this is good news.

But you can’t please everyone, and the people least satisfied right now are those who wish they’d listed their house back in the spring, rather than waiting. Their expectations are still sometimes unreasonably, illogically high. There is a willful blindness afoot. Just last night, for example, a client offered unconditionally on a well-priced house downtown. He had no competition and offered full pop; that deal really should have come together. But the sellers decided they’d sell the house to him only if he threw in another 35K.

I’ve seen similar behaviour plenty of times the last year or two. It’s always made me uncomfortable, but these days I think it edges towards unseemly. In this new market, when a seller lists their house with no intention of accepting even a perfect offer, a buyer’s time and energy is wholly wasted, along with that of the listing agent, and all the other agents who took clients through the property. I can’t help but feel that if the sellers were only prepared to sell for 35K more, then that’s where the house should have been listed in the first place. The old strategies don’t work any more, let’s acknowledge that. We have a chance now to move forward in a more transparent, more credible way. Let there be truth in advertising, and in a seller’s asking price. Let us be able to trust the numbers put in front of us. It has been otherwise for far too long, and to be honest we’re all exhausted.