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Do I need a Realtor® to sell my home in the Current PEI Real Estate Market?

In this hot PEI real estate market, do you still need the services of a realtor? We discuss the pros and cons of using a realtor.

You may be wondering given the extremely hot PEI real estate market if you still need to incure the expense of a Realtor® to help you in the sale of your house. Certainly homes are selling very fast on the island, especially in the under $300,000 category, you probably could sell your own property. However there are caveats to this and you should be aware of a number of potential pitfalls.

REALTORS HAVE THE TOOLS TO DETERMINE THE BEST STARTING PRICE FOR ANY PEI REAL ESTATE LISTING

Realtors have access to a vast array of tools and historical data regarding your home and what it has sold for in the past as well as current sale prices of similar homes that have sold recently. Your agent will do what is called a Comparative Market Analysis or CMA. This means they will search through recent and historical sales records of homes that are similar in size, location and features to your home and determine a suitable sales price.

While any home, at any time, is worth only what the market says it is worth, this data provides a very useful starting point. Realtors will also take into consideration such industry insider ploys as pricing your home to look like an especially good deal to encourage more buyer interest. This usually results in a bidding war, frequently resulting in the final sale price being higher than if the home had been priced at its maximum to start with..

REALTORS ALLOW FOR ARMS LENGTH DEALINGS WITH BUYERS THAT CAN MAKE HARD-BALL NEGOTIATIONS EASIER

If you choose to try and sell your home by yourself, such process known as “for sale by owner” or FSBO, you are putting yourself in the situation of not only being the vendor but also performing all the functions of a real estate agent. Unless you have worked in real estate you will not be as well equipped to carry out these functions as if you had the professional help of a Realtor.

You will have to show your own home to prospective buyers and should they be interested then switch hats and negotiate price and terms with them. You may during the initial period have come to develop a friendly relationship with your purchasers and then it will be more difficult to “hard ball” during pricing discussions. It is considerably easier to turn down an offer when presented by a Realtor and when you have not met those making the offer than it is when you already know them and are dealing with their offer face to face.

REALTORS ENSURE THAT YOUR HOME IS MARKETED TO THE MAXIMUM AUDIENCE THROUGH THE PEI REAL ESTATE MLS SYSTEM

While you only need one buyer, multiple interested parties lead to price wars and a higher final sales price. You can only sell your home once and as it is your largest investment you want to realize the largest capital return. You simply can not expose your home to as large an audience as your agent can through MLS and multiple other sales channels.

REALTORS ASSUME MORE LEGAL LIABILITY DURING A PEI REAL ESTATE TRANSACTION

Let’s assume you go the for sale by owner route. You find a buyer. Now you are on your own to take the deal from a hand-shake to a successfully closed deal. Realtors are part of a highly regulated industry that has tried and true ways of closing real estate deals. Your PEI real estate agent will follow the prescribed methods which will eliminate 99% of possible problems. Just the fact that the purchaser is being directed by a PEI real estate agent in of itself tends to keep deals on track.

However should something go wrong, firstly you can count on the organization of the real estate industry and your area real estate board to help find answers, but should your agent have made a mistake you can rest assured that all licensed Realtors are covered by Errors & Omissions insurance and that you will be taken care of.

Really using an agent for your purchase or sale is simply a way of not having to worry or direct a process that you may be unfamiliar with and also knowing that you have peice of mind should anything serious go wrong.

REALTORS ARE PAID BASED ON RESULTS

Finally it is important to realize that PEI real estate agents, like all Realtors are paid commission based on the value of the sale. It is in their best interest to do everything possible to ensure you get a higher price for your property.

IN CONCLUSION

Higher price (in many cases), protection from legal issues, as well as piece of mind that your interests are being well represented all are benefits of using the services of a Realtor when selling the largest financial investment of your life, your home.

Nicolle Morrison- Century21 Northumberland - PEI Realtor

NICOLLE MORRISON

I am Nicolle Morrison, co-owner and broker at Century21 Northumberland Realty and leader of “the Power Team”, a group of realtors dedicated to both local and international clients. You can contact me at 902-888-7237 or nicolle@century21pei.com

In today’s economic landscape, characterized by high market prices and elevated interest rates, the prevailing belief might be that the younger generations in Canada, particularly those categorized as Gen Z or Millennials, are shying away from the prospect of homeownership. However, this narrative doesn’t entirely align with the reality, especially when looking at the PEI real estate market. Despite these financial barriers, a significant number of young Canadians remain eager to embark on the journey of buying a home, with many setting their sights on the picturesque landscapes and vibrant communities of Prince Edward Island (PEI).

Spanning across two distinct age groups, Millennials and Gen Z represent a broad demographic spectrum. Millennials, now aged in their late 20s to early 40s, and Gen Z, the generation born between 1997 and 2012, together, comprise a formidable segment of the Canadian population. With over 6.7 million Canadians classified as Gen Z, their economic impact and potential as future homeowners is undeniable. This is particularly true in the PEI real estate market, where the unique charm and appeal of the island are drawing in younger buyers from across Canada looking for both value and quality of life.

Despite the challenges posed by the current economic climate, including a higher cost of living and inflation rates, the desire for homeownership remains strong. Insights from REALTOR.ca for the last quarter of 2023 indicated that a majority of its users, specifically 55.4%, were aged between 18 and 44 years, many of whom are actively exploring PEI real estate opportunities. This interest is further underscored by findings from a 2022 Royal Lepage Demographic survey, which revealed that 60% of Millennials not yet homeowners believe they will be in the future, with 51% aiming to purchase within the next five years. Moreover, a report from the Bank of Montreal suggests that 68% of Canadians are biding their time, waiting for interest rates to decline before entering the market, a strategy that could be particularly wise.

The optimism and determination to own a home vary across regions, with attitudes towards the feasibility of this goal differing from one area to another. However, the PEI real estate market offers a beacon of hope for many, with relatively more accessiblibility compared to urban centers in other provinces. This has made PEI a particularly attractive option for Millennials and Gen Z buyers looking for both affordability and a high quality of life.

The paths to homeownership are as diverse as the individuals pursuing them, with many young buyers adopting innovative strategies to navigate the real estate market. It’s clear that there’s a growing interest in condominiums among first-time homebuyers, driven by a more deliberate approach in a market that has become more buyer-friendly post-pandemic. PEI realtors also highlight the financial savvy of younger buyers, many of whom opt for minimal down payments and leverage first-time homebuyer incentives to make their dreams a reality.

Renting, too, has emerged as a strategic step toward eventual homeownership, with many in the Gen Z cohort seeing it as a necessary stage in their journey. This trend is particularly notable in PEI, where although the real estate rental market is tight with low vacancy rates renting can still serve as a stepping stone for young individuals aiming to save for their future homes. PEI realtors observe that an increasing number of their clients are opting for rental arrangements, often with roommates or siblings, as a way to manage living costs while planning for homeownership.

Furthermore, the shift towards remote work has expanded the geographic considerations of potential homebuyers, making PEI real estate even more appealing. The island’s beauty, coupled with its more affordable market, has attracted buyers from far and wide, with some willing to move from bustling city centers to embrace the peace and community spirit of PEI.

The aspiration to establish a solid financial foundation and secure a place in the real estate market remains a common thread among younger Canadians. PEI realtors and the PEI real estate market play a pivotal role in turning these aspirations into reality, offering guidance, insights, and opportunities tailored to the needs and dreams of younger buyers. Despite the financial challenges of today, the commitment to homeownership is unwavering, with many young individuals viewing the current market conditions as a temporary hurdle rather than an insurmountable barrier.

For those considering the leap into homeownership, consulting with a Century21 realtor can provide invaluable insights into the current market trends, personalized advice, and a clear understanding of financial readiness. The expertise of Century21 realtors in navigating the local market can empower prospective buyers to make informed decisions, ensuring that their journey towards owning a home on Prince Edward Island is both strategic and successful.

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