Arguably the most important and primary step when buying a Toronto home is to prepare the offer. This is because your lifestyle for the coming years will be dictated by the terms and conditions included in the agreement. Hence, once you have selected the appropriate Toronto home be sure to work with a real estate agent as their expertise in preparing the offer is vital in securing the property.
It is advisable that you go over the particulars of the deal carefully before the documents are finalized. If something does not make sense to you ask for clarification. Take your time to make sure everything is accurate because it becomes unalterable and compulsory once you have signed the document.
After the completion of this process the offer gets registered. It is then sent to the listing agent, and then the offer presentation appointment is set. Generally, when dealing in Toronto, offer presentations take place on the same day. At times it lasts all day long with back and forth negotiations. Your position will be negotiated by your real estate agent, it is their job to put forward your offer to the listing agent and vendors (sellers). You need to make yourself available for any “sign backs”. This back and forth can take you late into the evening so be prepared. After the completion of this step you will hopefully be the proud owner of a new house.
Items to be Listed in your Offer
• Offer price
• Deposit amount to be tendered with the deal
• Allowance to be made by vendor
• Home examination clause
• Financing clause
• Exact explanation of the terms that are to be included and excluded in the sale
Offer Amount
Pricing Guidelines:
Outlined below are some common pricing guidelines for Toronto homes:
1. The under-priced bad properties are usually sold for asking price, seldom more.
2. Average properties that are well priced are usually sold for asking price, rarely more.
3. Excellent properties that are new to the market are usually sold for asking price, or over asking.
4. Poorly priced properties usually get sold below asking price. This is especially true for those properties that have had to reduce their price to generate new interest.
Overpriced?
Compare the below mentioned price strategies to the property that you are thinking about buying. This practice will help you to determine what price you want to offer.
Listing Price Strategies
#1 Less than Fair Market Value
Priced below value, these properties often provoke bidding wars and finally are sold at a price over asking. The reasons for listing below market price may be to generate this bidding war or the real estate agent maybe just priced it wrong, or the vendor may have requested that price to sell it quickly.
#2 At Fair Market Value
Priced at a very competitive value, these houses are generally sold promptly and at a price which is either near the listing price or above. To price so correctly, the vendors thoroughly study the rates of other comparable properties for sale and then quote their listing price. When this is the case it is important to submit an offer as quickly as possible so that it is not sold out from beneath you.
#3 Somewhat Overpriced
These are the properties which are generally overpriced by five to ten percent. Sometimes it’s because they feel that their home is actually worth the value quoted, these sellers are usually open to negotiation.
#4 Tremendously Overpriced
Tremendously overpriced are those properties which are generally ten to twenty five percent overpriced. There are a number of reasons for overpricing a property by a vendor. First of all, it may be because the vendor thinks that the property is truly worth the price quoted by them. Secondly, the real estate agent may have overstated the property’s value in order to win the listing. Regrettably this happens more often than you would think. This puts the vendor in a very bad position because it forces them to drop the price. Dropping the price puts them in a very bad negotiating position.
