Homeowners Beware – Don’t Give Your Houses Away

May 18, 2021

May 18, 2021


Recently a Don Mills homeowner excitedly told me that he had just sold his house privately; that somebody knocked at his door and made him an offer he could not refuse, because he felt that not only was the offer price very good, but that, as the buyer pointed out to him, he was also not paying any commission since there was no agent involved.


He told me what he had sold it for and asked me what I thought about the price since I knew his house well. I tried to be gentle and told him that, as long as he’s happy with what he got, it’s okay. Since he was very keen on knowing what I thought about the selling price, because I live and work extensively in the neighbourhood, I had no choice but to tell him the hard truth – that based on the very recent sales of similar homes in the immediate area, he sold it for about $400,000 less.


Even if he had paid a commission of, say, 4.5% plus HST to an agent, he would’ve been $315,000 ahead in his pocket – net and tax free.


At even a 30% income tax bracket, he would have to earn $570,000 to net that amount!


Private buyers sure know the power of the lure of “you get more because you do not have to pay any commission when doing a private deal”.


If that buyer flips that house right after the closing of the transaction he will make a windfall. We always hear the phrase ‘buyers beware’. We don’t hear often enough the phrase ‘homeowners beware’.


This happens often. To be very honest, I personally cannot remember ever hearing of a private sale where the homeowner could not have gotten more in his pocket even after paying the commission. Homeowners often get so blinded by not having to pay commission or not having an agent involved, that they become, if I may put it bluntly, penny wise and pound foolish. Not only that, but they are also not having anybody look after their best interest, to qualify the buyer, to get enough deposit, to ensure that all the right clauses are in the offer, et cetera.


Sadly, many homeowners don’t know how high the prices of houses have gone up lately. If you are considering selling now or in the near future, it will be to your benefit to call a local realtor with a proven track record to come over for a quick look at your house, to give you an idea as to what your house is really worth in today’s market. You have nothing to lose and everything to gain.


It is not just about commission. It is also about proper representation and what you NET.


On a different subject, are we starting to sense a wee bit of tapering in the market in some parts of Toronto and Don Mills? Or is it just due to the lockdown? Or that supply is starting to increase? Or a bit of all three? Too early to tell.


Feel free to contact me should you have any questions or need information about the activity, prices and trends in your immediate neighbourhood.


Wishing you all a very relaxing and healthy summer.


Ecko Jay

Broker of Record / Owner

Ecko Jay Realty Ltd

Ph: 416-445-8858

eckojay@eckojay.com | www.eckojay.com

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