Advice for Toronto Real Estate Agents in a Slumping Housing Market

Only a year ago, Toronto real estate agents were riding high making great salaries and commissions with high house prices and plenty of sales. Sellers wanted to take advantage of selling at a high price and there were plenty of buyers with approved mortgages under relaxed lending regulations. It was an exciting time to become a real estate agent, either full or part-time and many novices entered this career at that time. Sellers enjoyed quick sales and often had buyers bidding on their properties so that the eventual purchase price was above the asking price they had set.

Soon the bubble burst and the Toronto real estate market crashed in late 2007 and early 2008. House prices and values dropped dramatically and there were many more foreclosures on the market than ever before. This escalating housing crisis made its way into other sectors of the economy and soon businesses of all sorts were closing their doors and laying off employees. Even though there are plenty of choices on the market for those looking to buy, lending criteria have become more stringent and buyers who would have received approval for a mortgage a year ago, no longer meet these criteria.
In order to continue to succeed in the real estate market, agents need to adapt to the changes that are taking place. It is no longer a seller’s market and even those who do meet lending criteria are wary of making such a large financial commitment at this time even though they know they are getting bargain prices in homes. Agents now may have to show many more homes before they make a sale, whereas they once had to show only two or three properties. Buyers no longer have to rush into the buying process and can take their time.

A Toronto real estate agent in the market slump that we are currently experiencing, whether you are a veteran or a novice, must face certain realities. One of these realities is that on average it will take you about six months to sell a home. This is often a hard situation to get used to if you were one of the agents that had a home on the market for only a day or two in the past. In order to deal with the situation, any properties that you are trying to sell should receive as much exposure as possible.

At the same time, you do have to reduce your advertising costs. It costs money to advertise in newspapers and on TV and radio. The best way to get in touch with prospective buyers is to have an Internet presence and to take advantage of all online possibilities to get the word out about the properties you want to sell. Make sure you have lots of photos so that you can entice foreign buyers. Another option to think about is increasing the commission fees you pay to buyers’ agents because this will entice them to advertise the properties as well.

As a real estate agent in Toronto, you do have to make sure that the sellers understand the current market conditions when they decide to sell their homes. Many of them do not realize just how hard it has become to sell a home in certain areas of the country or how much house prices have dropped over the past few months. This means that they may have unrealistic expectations of what to expect in the length of time the home will be on the market and the amount of interest buyers will express in the property. The asking price of the home also has to be in keeping with the current economic climate if you want to sell it quickly.

With home prices down and interest rates at an all-time low, this is indeed a buyer’s market. You may have to spend more time than usual developing a client base whereas in the past client’s came to you. You have to be able to balance the attention you pay to your current listings and attract new clients and buyers at the same time. Rental properties offer potential for interested buyers who would like to become homeowners and are renting at the present time. You can explain to them the advantage of buying at the present time rather than waiting for the market to stabilize because at that time prices will start to rise and interest rates will go up as well.