There is no set equation to determine how you’ll reach an offer price. Rather, the process involves a range of research and comparison that will vary with each situation. You’ll need to look at sales of comparable properties, and factor in additional data such as the condition of the property, the current market, and seller circumstances. With this information in hand, you will be able to determine a fair price range and, from there, establish the price you’re willing to offer.
• Compare prices of homes that are similar to the property you’re considering in the following areas: number of bedrooms and bathrooms, square footage, lot size, type of construction, and garage space.
• The most comprehensive and in-depth information can be accessed through the Multiple Listing Service (MLS). Your Realtor, who will be working closely with you to set your offer price, can help you navigate this service.
• Observe how the property compares to the rest of the neighbourhood. Is it average, above average, or below average?
• Look at structural condition: walls, ceilings, windows, floors, doors.
• Pay close attention to: bathrooms, bedrooms, condition of plumbing and electricity.
• Also check the fixtures: light switches, doorknobs, drawer handles, etc.
• What is the condition of the front and back yards?
• Cosmetic changes can be largely ignored, but any major improvements should be taken into account.
• Take special note of: room additions (especially bedrooms and bathrooms).
• Items such as swimming pools may be taken into account, but usually won’t affect your offer. Your Realtor can offer your guidance in these matters.
A seller’s market is considered a “hot” market. This type of market is created when demand is greater than supply—that is, when the number of Buyers exceeds the number of homes on the market. As a result, these homes usually sell very quickly, and there are often multiple offers. Many homes will sell above the asking price.
A Buyer’s market is a slower market. This type of market occurs when supply is greater than demand, the number of homes exceeding the number of Buyers. Properties are more likely to stay on the market for a longer period of time. Fewer offers will come in, and with less frequency. Prices may even decline during this period. Buyers will have more selection and flexibility in terms of negotiating toward a lower price. Even if your initial offered price is too low, Sellers will be more likely to come back with a counter-offer.
In a balanced market, supply equals demand, the number of homes on the market roughly equal to the number of Buyers. When a market is balanced there aren’t any concrete rules guiding whether a Buyer should make an offer at the higher end of his/her range, or the lower end. Prices will be stable, and homes will sell within a reasonable period of time. Buyers will have a decent number of homes to choose from, so Sellers may encounter some competition for offers on their home, or none at all.
Comparable sales information helps you establish a price range for the home you’re interested in. Adding in the additional factors mentioned above will guide your decision of whether you consider a “fair” price to be near the upper or lower limit—or the middle—of that range. Keep in mind, this price should be the one you’d be happy with once all negotiations are said and done. The price you decide to begin with depends on your particular style of negotiation. Most Buyers begin the negotiation process with a number lower than the “fair” price they’ve come up with.
Chuck was fantastic to work with! From attending our cottage inspection to connecting us with an awesome mortgage broker we needed to get the job done, he was there every step of the way to support us!
Working with Chuck was a pleasure. He really pulled out all the stops to make sure we could put the deal together. He personally made sure all went smoothly for possession day. Would definitely work with Chuck again either buying or selling.
Karen and I have had several experiences with Chuck both buying and selling properties. He is always willing to give advice if asked, and always willing to be patient with us while we are deciding how to proceed. He has gone that extra mile with helping us in any way. This has also included offering to help us get our home ready to sell. We can not be more satisfied with his service and that is why we have had him help us with several real estate transactions. We wholeheartedly recommend him to potential buyers and sellers in our surrounding area.
I had the pleasure of working with Chuck to find a great starter home and enter the market. After our initial discussion it didn’t take Chuck long to find something perfect for me. He’s motivated, easy to work with, and a highly knowledgeable agent. In addition to finding a buyer or showing you a property, he provides great advice based on your desires. Highly recommended!
Chuck helped us purchase a cottage property in 2020. My husband and I are extremely particular people. We provided Chuck had a detailed list of our exact wants, needs etc in a property to ensure we didn't waste our time looking a properties that didn't meet our needs. Chuck helped us secure the perfect property for us that met all the criteria and was a pleasure to deal with. He even offered months later to help us pick up a peddle boat with his trailer when I asked him for a recommendation for someone who could assist us. He is supportive throughout the sales process and continues to provide service after the fact. He lives and works in the community and I wouldn't hesitate to recommend Chuck to anyone needing his services.
Super nice guy. No hard-selling and easy to like! As my husband would say, Chuck passes the beer & BBQ test! He also crawled around under the cottages along side my husband during our appointments. Chuck is knowledgable, and put us at ease immediately. We bought the second cottage property Chuck showed us. He is calm with a sense of urgency. Timely communication when you’re anxiously awaiting news of an offer! Our experience from start to finish was great!