Luxury Insights

Luxury market in Canada setting records

Not that it is any surprise to those of you working the luxury market in Canada, but RE/MAX released the results of a study last week showing an uptick in homebuying activity in 13 of the 16 key markets studied and new records set in luxury home sales in 10 markets in Saskatchewan, Ontario, Quebec and Nova Scotia.  

You can find the press release and additional stats here: Luxury Housing Sales Surge Forward

“Principle of Sacrifice” strategy results in full price sale in 8 days

In our Institute for Luxury Home Marketing training we talk about sacrificing those buyers who will never buy the property you are marketing and instead focusing on the best prospects -- the prospects that are a match for the property based on property characteristics.  We call this targeted marketing  strategy “the principle of sacrifice.”

Paul  Basile -- a new ILHM member who is a Broker Associate with Douglas Elliman in Miami Beach --  contacted us to say he was testing the “principle of sacrifice” in the MLS description for one of his listings.  Here’s what Paul said in his email:

"I have a condo for sale in Miami Beach that was known as the "Land of No."  No renting, no dogs, no more than 3 people per unit.  I decided to take your advice and ‘sacrifice’ the 90% (who will never buy this property) and revise the remarks to target the 10% or even 5% that might actually be interested in my listing. 

Please note that the remarks are short because our Miami MLS only allows us to use 500 letters and spaces in our remarks section.  I will let you know if it sells faster with the revisions."

ORIGINAL MLS Remarks:
1510 Sq Ft Waterfront 3 Bed 2.5 Bath Corner Unit, Loft Condo w/10 Ft Ceilings Thru-out & Open Kitchen. Huge Living Room w/Great Light, Private Balcony Overlooks Intracoastal, Bal Harbour & Surfside. Watch Sunrises & Full Moons Over the Water. Loft has Windows Facing East, North & West and Multiple Walk-in Closets. Boutique Building Includes Waterfront Pool & Dock Availability w/No Fixed Bridges to Haulover Cut & Atlantic Ocean Boating! Rare Opportunity: High Ceilings, 3 Bedrooms, Cat OK & Low Maintenance.

Revised Principle of Sacrifice MLS  Remarks:
Finally Peace & Quiet! No Barking Dogs! No Renting! Tired of Noisy Neighbors? We Have Concrete Walls! Tranquility at its Best. Want Space? We Have 10 Ft Ceilings to Display Art! 1,510 Sq Ft Waterfront 3 Bed 2.5 Bath Corner Unit, Open Kitchen, Huge Living Room w/Great Light, Balcony View of Intracoastal, Bal Harbour, Surfside. Windows Face East, North & West. Huge Closets. Boutique Building w/only 24 Units Includes Waterfront Pool & Dock Availability!  Cats & Pets OK, but No Dogs! Maintenance $500

Did Paul’s new strategy work?  

Here’s what he reported -- he received a full price offer just eight days after he changed the description for his listing.  

Way to go Paul!  Congratulations.

Shrinking Inventory and Rising List Prices: Continuing Signs of a Recovering Housing Market

Ted Jones, Senior Vice President and Chief Economist for Stewart Title, spends a lot of time keeping his finger on the pulse of the housing market.  We asked Ted to comment on what he sees happening in the residential market nationally -- across all price points -- and he has some up-beat observations to share.  Here are Ted’s comments:

There are positive signs spanning the spectrum indicating a turning real estate market, despite some weak spots across the country.  

Just a few days ago,  USA Today reported that the number of existing homes for sale had dropped 22 percent from a year ago and now totals just 2.37 million units.  This is down 41 percent from the peak reached in mid-2007.  That said, the National Association of Realtors® reported rising prices in 74 of the 146 markets they track in the first quarter of 2012 versus declines in 72 locales.  Even more significant is the dramatic decline in some of the hardest hit markets:

• March inventory in Phoenix declined 64 percent from a year ago according to Arizona State University real estate expert.
• NAR reports very tight inventories in Phoenix, Orange County, California, Naples, Florida, Seattle, suburban Washington, DC and North Dakota (driven by the energy boom being experienced in that state).
• While mortgage delinquency rates remain above average (with average being 2 percent), they dropped from 6.19 percent in Q4 2011 to 5.78 percent in Q1 2012 according to TransUnion  (based on a sample of 10 percent of US mortgage holders)  and are down from a 7 percent peak in Q4 2009  
• All-cash transactions in Q1 2012 made up 31 of all sales—and I doubt these people would be buying and paying cash if they thought property values would decline further
• 22 percent of all buyers were investors
• Condominium prices rose 3.4 percent when compared to Q1 2011
• Q1 2012 existing home sales were up 5.3 percent from the same period in 2011 and are now running at annualized rate of 4.57 million
• Total existing home sales in Q1 2012 were at the highest level since 2007
• Move.com reports that many of the hardest hit markets are now among the top recovering markets   

Visit Ted’s “Jones on Real Estate" Blog for more market information. 

 

Get the Money Shot

We talk a lot about the importance of GOOD PHOTOGRAPHY when it comes to marketing luxury real estate.  In fact it is one of the most important elements of your marketing.    

Institute for Luxury Home Marketing member Joyce Marsh shares her tips on good photography in "Get the Money Shot" in the current issue of Florida Realtor Magazine. 

 

You can find additional photography tips in the How to Photograph Houses eBook by Stan Barron, a free download for Institute members on our Document Downloads page (login required).  

Where in the world of real estate was Laurie Moore-Moore?

This is the last of Laurie's "Grand Tour" geography quizzes.  Take a look at this photo of Laurie (in the rain again) see if you can guess the location of this real estate office. Can you guess the city and country in which this office is located?  


If you know, email us the answer.  

We'll select the winner in a random drawing of all the correct answers, so email your answer by Monday April, 23rd.  We'll announce the winner on Tuesday, April 24th.

The winner will receive 50 Member seals and 50 business card jackets.

 Hints:

• City’s name translates to ‘Salt Castle”
• The Mirabell Gardens are located here
• The city is famous for its Baroque architecture
• Mozart was born here

Good luck!

UPDATE:

Congratulations to Lana Lowell-Mclaughlin of Realty Pros of Naples in Naples, FL and Larisa Stolyarov of Beachfront Realty in Aventura, FL.  Lana and Larisa are our two lucky winners randomly selected from all of the entries which correctly named the location -- Salzburg, Austria.

"Thank you" to all of the many members who've played along!    

Where in the world of real estate was Laurie Moore-Moore?

Take a look at Laurie’s photograph of this real estate office.  You will recognize the brand, but can you guess in what city and country this office is located?  


If you know, email us the answer.  

We'll select the winner in a random drawing of all the correct answers, so email your answer by Monday April, 16th.  We'll announce the winner on Tuesday, April 17th.

The lucky winner will receive 50 Member seals and 50 business card jackets.

 Hints:

• This city began before 1AD as a Celtic settlement
• It is famous for its mineral baths
• It is a combination of two cites on both sides of a river
• Its Castle Hill is a world Heritage Site
• It was bombed by the Allies in WWII

This photograph will give you another visual clue:

UPDATE:

As many of you obviously know, this is beautiful Budapest, Hungary.  We had lots of correct answers to this week's puzzler, so again we randomly selected two winners from all the correct entries.  

Our lucky winners this week are: Rhonda Diner of Sun Realty in North Naples, FL and Sela Dragan of Keller Williams Platinum in Phoenix, AZ.  Congratulations!

 

Don’t lose to competitors who “buy” listings by overpricing

It’s a common complaint.  Another agent is competing with you for a listing and “buys” the listing by agreeing to list it at a price you know the market will not support.  The seller likes the idea of the higher price and either you lose the listing and hope to be agent number two, or you feel trapped into accepting the listing at the higher price.  Neither of these options is attractive.  So, what’s the solution?  Here’s one way to approach it with a script based on a strategy  suggested by one of our members…

“I understand that the higher price, which the other agent is suggesting, is attractive to you.  However, the question a savvy seller like you will want to ask is whether the other agent is doing what real estate professionals call, “buying the listing.”   In other words, does the agent really believe that he or she can sell the home at or near that price, or does the agent plan to just ride the price down, down, down over time?

“This strategy hurts you several ways.  The listing quickly becomes identified as overpriced, showing activity drops, and low ball offers come in.  The time it takes to sell your house goes way up.   

“My recommendation is to price it right from the start.  However, if you truly want to try the other agent and the higher price, test the other agent’s commitment to that price by asking if he or she would release the listing to me if at some point the price is reduced to $________, the list price I’m recommending.  If the answer is no, that’s a sign that the agent may not believe he or she can sell your home for more that I’m recommending.  If I were a seller, that answer would make me uncomfortable”  

You might want to end by adding something about your track record in getting homes sold (your days on market and percent of list price statistics for example).   Then, ask for action.  

“Would you be willing to test the other agent’s commitment to the higher price by asking them to agree in writing to release the listing to me if the price is reduced to $_______?”

Where in the world of real estate was Laurie Moore-Moore?

We're back this week with another geography puzzler.  Take a look at this photo of Laurie in the rain and see if you can guess the location of this real estate office.  You may recognize the brand, but can you guess in what city and country this office is located?  


If you know, email us the answer.

This week, instead of the first member to email us with the correct answer, we'll select the winner in a random drawing of all the correct answers, so email your answer by Monday April, 9th.  We'll announce the winner on Tuesday, April 10th.

The lucky winner will receive 50 Member seals and 50 business card jackets.

 Hints:

• The town is known for gingerbread.
• The town is located where three rivers converge.  
• One river’s name should make you think of waltzing.

Good luck!

UPDATE:  And the winner is...

Lesa Gilbert of Fairhope Alabama and Martine Addison of Denver, Colorado (yes, again!).  They both correctly identified the location as Passau, Germany (also known as Dreiflüssestadt or "City of Three Rivers") and were randomly selected from all the correct entries. 

Yes, there are two winners this week.  As you may recall, Martine won a couple of weeks ago when she correctly identified Vienna, Austria.  With her response this week she included a note that very graciously said, "You don't have to enter me in the contest, I just like playing."  

Well, that didn't seem fair.  After all she had the right answer and it was a random drawing.  So, just like all the other folks with the correct answer, we put her name on a little slip of paper and dropped it in box.  After all, it is a random drawing and what are the chances of her name being the one drawn, right?  

Suffice it to say that Martine is both knowledgeable when it comes to European cities, quick to respond, and very lucky!  Given this apparently unbeatable combination, we thought it would be fun to pick another name from the box, and make this a double winner week.  

Congratulations to both Martine and Lesa!

 

America's Sprawling Cities

As American cities continue to grow in population, they are growing in physical size too.  There is an interesting piece in The Atlantic Cities that delves into current census data and looks at the trends of growing urban populations (more than 80% of Americans now live in urban areas) and cities, both large and small, gobbling up more land.  

These growing urban areas aren't just cities extending their borders, according to Hawley, but rather clusters of urban development on the fringes of cities that are growing towards each other. As two areas spread out and get closer together, the space in between "gets sort of swallowed as growth between the two areas happens," Hawley says.

Here's a graph which shows "How U.S. urban land area has grown since 1990 in the 10 biggest gainers of 2010"

These are clearly metro areas that have grown dramatically, but it is not just large metros that are growing.  The cities with the largest percentage increases tended to be the smaller to mid-sized cities.  

These trends are a reflection of our changing  cities, development patterns and home buying behaviors. Understanding them is a key to understanding where future opportunities may lie.  

 

Where in the world of real estate was Laurie Moore-Moore?

Take a look at Laurie’s photograph this unusual sculpture, around the corner from a local real estate office.  Do you know what city and country this is?  


If you know, email us the answer.  The first ILHM Member to email us the correct answer will receive 50 Member seals and 50 business card jackets.

 Hints:

• Franz List played here in 1820 at age 9
• George W. Bush and Vladimir Putin held a summit here in 2005
• It was the center of the “Velvet Revolution”

These photographs provide more visual clues:

 

UPDATE:

Congratualtions to Institute member Espie Franky of Prudential Florida Realty in Miami/Coral Gables.  

She was the first to respond with the correct answer of Bratislava, Slovakia and is our winner this week!  

Stay tuned for another "Where's Laurie" challenge on Friday.