Author: Marc Evans

A few of you have heard me say this before. It means to be aware of your surroundings, because something is fishy.

Ever get that feeling? It’s called your gut instinct, and I suggest you side with it as often as possible.

When your notice something is strange, you can’t quite put your finger on it, but you know have this eerie feeling about continuing with whatever it was you were doing, here is what I suggest you do:
1) Take a step back. If you are around the people who gave you the ‘jeebies’, just say “Can you give me a second? I just need to make a quick phone call.”
2) Call someone you trust, and that has the time for you. Tell them about the scenario and get a second, objective opinion. Sometimes it’s just you, but more often than not something IS weird, and your trusted friend will confirm it and hopefully be able to give you an idea of what to do about it.
3) Stall or slow down until you’ve figured out how to proceed. If something isn’t right, pump the brakes a little and try to clear the issue before continuing.
4) Tell those that have a vested interest in the outcome, but in utmost confidence. If other people are relying on you and your ability to go through with a deal and put things together, let them know that something seems a bit weird to you, and you will be getting it resolved over the next day or so, and that if they feel the same ‘gut instinct’ to please let you know. You would be surprised how often others have been thinking the same, but didn’t pay enough attention to their gut, or who will now become aware of the same concerns simply because someone told them to pay a little more attention.
5) Deal with the issue. This is quite often the hardest part, but if your ‘partners’ and trusted friend agree that your concern is valid, approach the person or the source of the issue and clarify it. Go to the heart of the issue and clarify whatever concern you have.
6) Control the issue. Some sort of control has to be put in place so that the concern doesn’t come to life later on. Is there some regular checking-in that needs to be done? Should someone else be supervising? Should responsibilities or the scope of the project be changed or reviewed?
7) Antennas Up! Be aware of what might go wrong, and keep your eyes and ears open.

This topic has come to the forefront of my mind recently because as a self-employed individual, my level of responsibility, accountability, and risk have all risen infinetly. My success is subject to so many different variables, that I can’t leave anything to luck or chance, and if something seems to be a little out of place, I had better do my dilligence and clarify that concern or it could be egg on my face.

“Good instincts usually tell you what to do long before your head has figured it out.”
– Micheal Burke

Have you been to the new Athletic Club in Orleans?

It is the latest rave of the town, and with good reason! The Athletic Club spent over $14,000,000 (that’s no type – fourteen million) on the 65,000s.f. facility located at 3772 Innes Rd, and has so many ways to spend your time and energy, the only thing they are missing is some residential housing so you could stay overnight. From Wi-Fi enabled café’s to anti-gravity yoga, to child care (which can be monitored from the monitors on the cardio machines) and a women’s only fitness club, the local gym’s have better start discounting their fees to compete with the new kid in town. Other innovative programs and services they offer include 160 pieces of cardio equipment, over 140 group exercise classes per week, massage therapy, steam and dry saunas, aquatic centres, whirlpools, weight management programs and nutritional counseling.

Club Hours are from 5am to 8pm Monday to Saturday, and 8am to 8pm on Sundays.
Call 613-824-4100 for more information, or visit http://www.theathleticclubs.ca/

What do YOU think of the Athletic Club?

For Release 10:00 a.m. November 2, 2010

Members of the Ottawa Real Estate Board sold 1,042 residential properties in October through the Board’s Multiple Listing Service® system compared with 1,197 in October 2009, a decrease of 12.9 per cent. Year to date, the number of properties sold has declined 2% compared to the same period last year, a record setting year.

Of those sales, 221 were in the condominium property class, while 821 were in the residential property class. The condominium property class includes any property, regardless of style (i.e. detached, semi-detached, apartment, stacked etc.) which is registered as a condominium, as well as properties which are co-operatives, life leases and timeshares. The residential property class includes all other residential properties.

“Six months ago we were in a strong seller’s market, now we have moved into a more balanced market position,” said Immediate Past President Rick Snell. “Some properties are still receiving multiple offers but this is happening much less often than was the case in the spring.”

The average sale price of residential properties, including condominiums, sold in October in the Ottawa area was $340,719, an increase of 6.8 per cent over October 2009. The average sale price for a condominium-class property was $263,292, an increase of 13.4 per cent over October 2009. The average sale price of a residential-class property was $361,560, an increase of 5 per cent over October 2009. The Board cautions that average sale price information can be useful in establishing trends over time but should not be used as an indicator that specific properties have increased or decreased in value. The average sale price is calculated based on the total dollar volume of all properties sold.

You would think that value would be more clear cut than it is. You would hope that everyone could see value the same way you do, and that there is no real debate about it, because facts are facts, right? Well, the FACTS will tell you that many will people will view and determine value in relation to different criteria based on their individual perspectives, and that something might not be as valuable to one person as it is the next.

Starting to make a little more sense?

Let’s look at a few examples of how someone could determine value:

1) Judgmental Perspective
In Managine for Quality and Performance Excellence (James Evans, Williams Lindsay 2008), the Judgmental Perspective on Value is more of a common notion of superiority or excellence among consumers as a result of marketing efforts, and as such, can not be defined. It is “both absolute and universally recognizable, a mark of uncompromising standards and high achievement.” An example would be the value you perceive when you hear of Ritz-Carlton hotels, or Lexus automobiles.

2) Product Based Perspective
Evans and Lindsay suggest that this view on Value is a function of a specific, measurable variable such as ‘miles per gallon’, or ‘stiches per square inch’. This form of value is not directly related to price, because quite often enough products with similar quality have different prices (perhaps due to Judgmental perspective on Value?)

3) User Based Perspective
This perspective assumes that value is determined by what the end user, or consumer wants. A big supporter of free market principles – I like this definition. This definition would ask “Valuable to whom? and how much would they pay for it?”

Turning to Real Estate, let’s look at the 3 most popular means of determining a Home’s Value.

1) Cost Value
How much would it cost to build the home from the ground up? Did it cost you $100,000 or $500,000? Surely that must be the value of your home, right? “I put in a $5000 furnace, so I increased the value of my home by $5000!”. Maybe….

2) Income Approach
This is a great way to determine value on income producing properties. This approach dictates that the value of the property is determined by the income it could produce at it’s highest and best use. Quite often that is used to sell a property on it’s potential, rather than another form of value (i.e. a tiny bungalow on a regular lot in a suburb VS the one two blocks over on a main road in front of a WAL-MART. You could imagine that there would be more potential with the latter, and it’s list price would likely reflect that). For a type of property that is commonly traded, such as a piece of investment property, be it residential or commercial, the value is nearly always a funtion of how much income it produces (as well as other variables of course, but income is the driving factor).

3)Direct Comparison Approach
This is the one folks. Make no mistake about it, THIS is how you can best guess what your home will sell for. It is based around the principle that an informed purchaser would pay no more for a certain property than the cost of acquiring another existing and equivalent property (http://www.aicanada.ca/section.aspx?id=39). What this means is, “how much is the home worth to a buyer? And at which point would the just as well go and buy my neighbours home?”, because in the end – that is the person that is paying for it. When preparing a home for sale, it doesnt matter how much the City values your home for tax purposes, or a bank appraises your house for, or even what your neighbour or YOU think it is worth – and why? Because none of these people are buying the home.

What you need to focus on is the value of the property in the mind of the person that will BUY your property. How do you determine what a buyer will pay? I’ve found that the best way is to study the past behaviour of buyers in your immediate market, and find out how much they have been paying for a home like yours. Naturally, you will have to make adjustments based on certain features – but don’t be lured in to say “well I paid $5000 for my hot tub, so add $5000 to my house!”….. because you’re just reverting to the cost approach. The proper question to determine adjustment amounts would be “how much is that feature worth to an informed buyer? How much would they pay for that? and at what point is it not worth it to them anymore?”

I understand that this is all easier said than done, because the average Joe or Jane does not ave access to the resources required to find out what homes SOLD for (as opposed to what they were listed for), let alone how much each adjustment should be worth in the real estate market. This does take the proper resources, skill, time and experience to determine.

This is one of the reasons that a Realtor is so Valuable (to the end user) – because they can do that kind of work for you, and often offer it for free as a way to put themselves in front of you.

How do you value your home?

Have you ever heard of someone placing value on their home based on another perspective?

The classic example of price VS perceived value is in the automobile business. You’ve all seen an ad from car dealers that sell “a dollar over invoice” or “at invoice” or “a dollar below invoice.” No value. Certainly no perceived value. What happens after I take ownership? How will I value from the “use” of my purchase? What kind of service can I expect?

I promise you that no one remembers the price at 7:00am when you are waiting in line at a car dealership for service, and you don’t get taken until 7:30, and the service person is somewhat rude, and they have no loaner cars so someone else has to drive there with you and take you to work, and when you get back at 5:00pm to pick up your car you wait another 20 minutes and come to find out they didn’t have the part for what was broken, and you have to come back again next week.

But you were the smartest guy in the world! You saved $100 on the car! At that moment you would have paid an extra $1000 for the car.

This was an excerpt from Jeffery Gitomer’s Little Red Book of Selling. Go to http://www.Gitomer.com for more information.

No, not Bret the Hitman Heart. Unfortunately not as cool – but arguably more important 😉

The Real Estate industry is changing. Buyers are more Internet savvy than ever – finding homes on the MLS and then previewing them through virtual tours and Google Earth. Sellers have added a great marketing tool the their private efforts – the Internet posting. In an age where buyers can find their own home, and sellers can advertise their own home – where and why does a Realtor fit in?

Answer: In the transaction itself, because the actual transaction involving property for money is a complicated and important one.

The value of a Realtor is a long and complicated discussion, and I’ve had it many times, even on this blog. Of all the topics I’ve touched on such as pricing, marketing, legal, insurance, accounting, financing, negotiating, managing, and closing (to name a few – seriously), the huge bulk of those skills come into play in the transaction itself.

That being said, the Realtor of the future has to focus their efforts on becoming somewhat of a business advisor, project manager, and a transaction expert. the level of professionalism in ALL of the topics I touched on above will have to increase tremendously – you know why?

BECAUSE MANY PEOPLE WILL NOT WANT TO PAY FOR A HOME SEARCH OR HOME MARKETNG – regardless if I or other realtors know we can do a better job. There is a shift coming, and that is the shift of private buyer and seller empowerment – however short lived and naive as is may be in most cases.

Realtors that simply market homes or find properties for clients and STOP the hard work once the transaction starts are going to get a rude awakening. Realtors that is, that put a sign on a lawn and the net, or for buyers create a search and in both cases sit back and wait. “Oooh, you mean you can create a custom search for me?” or “Oooh, you can put up a professional listing?”. Get over yourself – cause your ‘clients’ are about to.

The deal has to be executed – and THAT is where 99% of the guts has to be for top professionals. Leave the home search and marketing efforts OUT of your value proposition, because there will soon be no perceived value there at all. Up your professionalism, get more designations, continue your education, study SERVICE – not SALES, and your business, and your future – will be bright.

The first principle in Marketing 101 is to define your target market, and then what follows is the customization of a marketing plan’s key elements (Price, Place, Product and Promotion) that are tailored to that target market. 

So WHY IS IT that marketing efforts in today’s Real Estate market are the EXACT SAME 99% of the time? The marketing plan of the day seems have 10 pictures taken, uploaded and a description that says “Wonderful X bed Y bath home – Must see!”

Really? Is that all you need? With approximately 2400 Realtors in Ottawa alone, and with over 5000 listings on the Ottawa Real Estate Board at the same time – do you really want a marketing plan that blends your home in with the rest?

One of the benefits I provide to all my clients is a tailored marketing plan according to WHO buys their product, WHERE they are, and WHAT they like. Now depending on your location, your builder, your style of home (inside and out) and your price range – there will be a certain type of buyer that dominates your area. Not only can the target market for your home be identified, it can be understood and targeted according to elements such as:

• Marital Status
• Age
• Level of Education
• Average Household Income
• Employment Type
• Languages Spoken
• Ethnicity and Religion
• Events that occurred in their lives
• Movies they watch
• Entertainment the enjoy

I can pinpoint this information down to a 250m radius from YOUR HOME.

How? Cencus, postal and land registry information – combined and analyzed.

Why? Targeted marketing speaks to the right buyers, attracts them, gets them in the home, and ultimately leads to QUICKER and more PROFITABLE sales.