In a recent transaction involving a South Rosedale family home, our clients faced a common dilemma: they desired a higher listing price than the estimated value, yet they also sought a swift sale. Sensing the delicate balance required, we opted to list the property right at its assessed value.
Did our decision pay off? Absolutely. As we predicted, by listing the home a little under what our clients desired, it sold for an impressive 98% of the list price all within a mere five days.
What’s the takeaway from this narrative? It underscores the invaluable wisdom gained from our team’s collective 50+ years of experience. We understand when it’s prudent to heed our clients’ desires and when strategic pricing decisions can yield optimal results.
Working in luxury real estate, agents quickly learn two essential facts. Firstly, luxury real estate proves remarkably resilient, often remaining relatively unaffected by economic turbulence that rocks other market segments. Secondly, it’s a tight-knit community. Agents in the luxury sector of Toronto operate within a close network, where most are acquainted with or know of one another. Consequently, they’re also aware of who has a reputation for overpricing.
However, this valuable insight isn’t universally known among sellers. Many assume their agent has their best interests at heart and may not question whether their property is listed above market value, sometimes even encouraging it. After all, who doesn’t want to sell their home for a little more?
Regardless of the industry, overvaluation adversely affects both sales and reputations. While mispricing may yield occasional short-term gains, establishing a strong reputation based on sound valuations brings long-term success for all parties involved.
Prioritizing Client Needs over Self-Interest
Though it may seem obvious to prioritize meeting client needs for business success, the extent to which these needs are met can vary greatly. In our experience, focusing on serving buyers and sellers rather than ourselves is paramount, as our success hinges on consistently delivering quality service and ensuring client satisfaction.
While incorrect prices may seem insignificant at the micro-level, they can have profound effects. Overvaluation distorts market data, leading to prolonged listing times and underperformance, which is detrimental to the economy. In real estate specifically, it results in homes sitting on the market for extended periods and a narrative of underperformance.
Don’t Sacrifice Long-Term Success for Short-Term Gains
At The Penzo Team, we adopt a forward-thinking approach by focusing on long-term value appreciation.
Here’s how we differentiate ourselves:
We Prioritize Honesty
In the real estate business, relationships are key, so we prioritize honesty and transparency to build strong client relationships founded on trust.
This commitment to honesty extends to conversations about price. Although these discussions may sometimes be challenging and clients may not always agree, we believe it would be a disservice to overvalue a property. We always say, “The market will tell us if we got the pricing right,” and we’re always willing to review and adjust as necessary. When faced with the choice between agreeing to an overpriced number or relying on our combined 50+ years of industry expertise, we consistently choose the latter, fostering respect and yielding returns.
We Recognize the Importance of Timing
Time is a crucial asset in real estate, so we avoid wasting it. Pricing accurately allows us to save time and money while delivering results. This approach creates momentum and enhances the client experience, adding value without inflating prices, and ultimately providing a competitive advantage. According to a recent Salsify survey, studies have shown that clients are willing to pay more for a transparent, honest experience.
Our clients depend on us for guidance, so we aim to meet that trust with a wealth of knowledge and industry experience. We continuously educate ourselves, attending industry meetings and conferences to stay informed. To refine our understanding of property values, we delve into the “behind the scenes” details of similar properties within the market. By asking industry-specific questions, we gain a deeper understanding of appropriate pricing strategies.
Thinking about listing your home and interested in discovering its potential value in our current market? Reach out to us for a confidential and complimentary consultation.
