This is a follow up from last weeks. Looks like I will make this a “Saga”. How about that?
Real estate beginnings in Brantford, Ontario, Canada 1982
Living in Nova Scotia, Canada my first experience with real estate was buying a mobile home (fixed on a rented piece of land) for my son and I. Later I had a home built in New Glasgow, Nova Scotia. Lived there until I moved to Toronto where I went for my Real Estate course.
Moved to Brantford (due to my husband’s job), a small Town with 76,000 habitants and prices were “a bit lower” than Toronto where I started my career with Hurley Real Estate from whom I purchased my home.
Now working in Real Estate in Brantford, Ontario, Canada in 1982 after finding it too boring staying at home when my youngest child started playgroup. I looked at it as a past time until I found out that after few months that I had a passion for it and became quite successful working at Hurley Real Estate and later on for Royal Castle both in Brantford. ON, Canada.
Quickly I found out that it takes a a lot of work to be successful in real estate…
I had, though, familiarized myself with value of properties going to home opens, reading Real Estate information. Quite excited about a new career “green” and eager to work and to prove myself. The wind blowing, snow coming down (mind you I had to shovel the snow before going anywhere), slippery roads, confronting all the weather hazards, I was trying to get a listing knocking on peoples doors.
The farm and the lesson learned
Coming to this door of a farm just on the edge of the Town. I saw the extensive acres and acres of land, thinking to myself: “that would be a nice property to sell”.
The owner allowed me in, we talked and without any Brantford price experience, I vented my opinion:
“I think is worth 10 million dollars!”
based on my Toronto values. The old owners jumped at the hope I gave them and I listed their home on the spot!
Arriving at the office, happy as Larry with a $10 million dollar listing under my arm, I could not control my excitement. Until I heard the other 40 Agents in my office who laughed, laughed and laughed.
I felt pretty stupid. My self esteem went right down the drain…
But here comes Michael Hurley, in his early 40’s, very respected, super professional, the owner of the Agency. He told me:
“No problem Alycee. Go back to the owners and say to them that you made a mistake, you inflated the price because you were from Toronto and prices there were a lot higher then little Brantford.”
Next day, I armed myself with confidence given to me by my boss and faced the consequences of my rushed opinion. The owners were very nice, understood my honest mistake and dropped the price to $5 million dollars!
Wow! I was really on top of the world! Mike put me to work and made me search everything about that property. The Agency gave me a lot of support and Hurley Real Estate erected 6 massive signs 14 feet above the ground with banners every 200 meters surrounding the property which was on the corner of 2 major roads.
The whole town saw and called me, I had calls from Texas, California, Toronto, everywhere. My phone was hot and listings pouring in. I was perceived as very clever, successful without even a listing sold. My exposure was over the top with those big signs where anyone could see. The listings and sales came in easily after few weeks. I was selling selling, selling.
Due to my research I discovered that the Farm was on a green belt until 2002. So, subdivision was not possible for 20 years. I had no chance of selling that beloved listing…
The big signs on the property just across from the city was bringing me more and more business and obviously I started to be more confident, acquired more knowledge.
Armed with all the facts concerning the farm I went back to my owners and disclosed my findings and confessed that I had given a false hope until I finally went back to my owners and told them that the hope I gave to them was not to be a real thing. They could pull out of the contract if they wish but their property was worth at that time only a miserable $275,000.
We talked and they confessed to me that they never believed I would sell the property at that price. But they were not in a hurry and let me give them hope. After all this they decided to sell the property and asked me to drop to $2,500,000.
I left the Farm with so many ideas what to do next to secure a sale. I contacted every one that had called me during the term of the listing and I surfaced 2 offers!
One offer for $1,600,000 conditional on the green belt be lifted. That was “a pie on the sky” because that was not going to happen.
The second offer was for $1,000,000 cash, no condition.
They took the offer, the buyer purchased the property for his future grand kids. He was only 40 years of age and his children were only 4 and 6 years old. The owners were allowed to stay there rent free for 6 months until they found a home .
The sale took place 5 month after my first contact with the Owners. Was in a reasonable time for that amount of cash in those days. In Canada we worked on 6.5% commission. And at my office I had sold so many properties before this one happened that my office split was at 80%. “I hit the jack pot”
The “morals” of the story
Some Agents offer “hope” and some owners believe in the hope and put the property on the market at a higher value than is possible to achieve.
A falling market could cost a lot of money because even when you drop the price, the market keeps dropping and you are chasing the market down.
On a healthy market, you drop, the market go up, you drop, the market improves a little more and suddenly “bang” there is a sale!
The other moral is:
There is the emotional buyer who may pay a little extra for the property for one reason or another.
Now I looked good because I sold to that “emotional buyer” (his kids are millionaires today, thanks to that land) for an astronomic price.
The owners were happy. they were in their seventies and bought a brand new home from me for $175,000 and had money to live well for the rest of their life.
By the way, the other Agents were not laughing at my “lucky break”.