Will it ever end? The Canadian Centre for Policy Alternatives just came out with their report that states ”Canada is experiencing, for the first time in the last 30 years, a synchronized housing bubble across the six largest residential real estate markets in Canada.” You can find the full 24 page report at www.policyalternatives.ca.

The author of the report, David MacDonald, provides three different scenarios a) a market correction through straight pricing deflation of homes b) a deeper and longer crash over several years with prices dropping each year, or c) a rapid and steep decline similar to the US. The biggest problem I see with this report is that it is grouping all the cities together and all having the same issues.

Due to Canada’s size and diversity, what happens in one region doesn’t necessarily affect another. Alberta as an example always lags behind other provinces initially as overall economic growth increases. Then due to our energy based economy it surges above and beyond the other economies after the demand factor increases. Ontario on the other hand often starts strong due to increasing manufacturing. As for specifically Vancouver, it seems to operate under its own set of universal laws as there is no way people can afford to buy homes there, yet it continues merrily along.

Now, having said that, we are also all tied together with certain aspects, such as mortgage rates, which David also says will play a factor. I absolutely agree with him that if mortgage rates return close to historic norms too quickly it will have a dramatic affect on affordability. This is why I have been surprised by the previous two rate hikes the Bank of Canada already instituted this year. It’s also something that the finance minister is paying very close attention to at this point.

They are very aware that if they continue to consistently increase rates, even at a slow pace, it will dramatically affect the entire economy.  As I have pointed out in previous articles, Canada had been the only G7 country to increase rates and we were only able to do so due to our quick recovery from the global slowdown. This was predominately due to many of the economic policies Canada had in place along with our stricter lending practices. Many other mortgage rate watchers, as well as myself, believe that if we do see further increases they will be very minimal and rates will stay very close to where they are currently at for a while. The caveat being if the economy starts to grow like crazy, increasing rates will just keep everything in balance.

Overall, he makes many good points and provides several possible outcomes. The unfortunate points being he doesn’t look at any of the positive signs we see out there which point to the market possibly dropping still a bit more, but regaining strength as we move into the end of 2010 and into a positive looking 2011.

Just to close off, the same day the above mentioned report came out, a report from C.D. Howe also came out. It took the stance that there is no indication that Canada will suffer a US style housing crash. Also a good read, it just didn’t get much press because it may perhaps have been to positive and positive headlines just don’t sell!

It sounds like this headline is showing up all across Canada. Variations of this headline have been triggered by a new report from the Canadian Centre for Policy Alternatives. In the report they talk about six major centers (two in Alberta!) that are in a precarious position. (links to the reports are at the bottom of the article!)

I was writing an article about this for my weekly Real Estate column at the Chestermere Anchor when I found the following video from Peter Kinch. Peter is one of the top ranked mortgage brokers in Canada, and in the video he presents his view on the subject.

Also of note, he brings up the other report that just came out from the C.D Howe institute report that says there is a low risk of a US style housing burst. Basically the exact opposite of the other report. Also strangely enough, the C.D. Howe report didn’t make much news in the headlines! Anyway here is the video and I will probably have my post about this up some time tomorrow.

**Give the player a couple of seconds to start after you click the arrow!**

Oh, one more quick note, the next Bank of Canada rate announcement is due out on September 8th, if you are keeping track!

Links to the Reports:

C.D. Howe : Not Here? Housing Market Policy and the Rick of a Housing Bust

Canadian Centre for Policy Alternative: Canada’s Housing Bubble, An Accident Waiting to Happen

Want to know how to waste two hours of your time? Get subpoenaed as a witness and then discover that the officer neglected to update you that the court date changed, that’s how.

What a pisser as I had things I needed to get done and pushed them off to do the right thing. What’s more aggravating is this same officer never returned one of my initial calls or emails when this first started a year ago. It seems to be an ongoing saga.

I understand the police are busy, I understand they are often understaffed, but here we have a chance to put a deadbeat away who stole a vehicle at knife point and we’re screwing around. Anyway, I’ll have more updates after the 1st of September when I find out the new and updated court date!

Here Comes The Judge!

Worse yet, this was part of my pilot project to help young kids get off the street by putting them in some of my shared accommodation properties. Now just to add some perspective to this, I am not Mother Teresa, or even close!, part of this was to help fill rooms and some was indeed to try and help people who needed it.

Quick recap on the project, out of 11 tenants, I evicted or assisted nine of them to leave, the other two will never be allowed back. These were 18-24 year old kids who wanted financial assistance, housing assistance and typically had problems at home. The problem with the system I see is they were never made accountable.

They didn’t have to work for their money, they didn’t have to show up for job interviews, they didn’t have to get up in the morning. Also since they didn’t pay for anything and new housing would be found for them, they also weren’t responsible for anything. No smoking, sure, whenever Bill wasn’t around, no overnight visitors, sure whenever Bill wasn’t around. Anyway you get the idea.

Anyway, I will post more either late tonight or tomorrow as the story unfolds!!!

If you follow the Real Estate markets or own rental property it is incredibly easy to get depressed about the current market situation. As you scan the Real Estate headlines and find out sales have dropped 41% from the last year. Or as you can talk to Realtors, who will tell you about the huge amount of inventory currently for sale or you can even talk to your tenants about how they feel you need to lower rents because there are so many vacancies out there. The last trap was the one I fell into with my tenants help.

With this many options and this many negatives, it’s easy to get worried and it’s important to understand where your sources of information come from. My mistake began with talking to a tenant of mine, who was requesting a rent reduction due to the changing market. I am aware there are more vacancies and I know the market is a bit more competitive, I also know what a headache it can be to move. But they were good people so I caved in and ended up offering her a $75 reduction, which wasn’t good enough for her. So I agreed to switch to month to month while they explored their options, without doing any rent reduction!!.So now, here is how the trap unfolded.

When I collected the last monthly rent check, I listened to her story about how she felt bad for landlords like me, since there were so many vacancies out there and so many choices for renters, I may be vacant for quite a while. It was all rather depressing really.

To help elevate the potential depression, I also had another property that was just getting some renovations completed and was currently vacant, plus two more vacancies coming up. It all looked rather glum.

Next, came the reality versus what I had been told by the wrong source, or at least a source with a different agenda. Late one evening as I stressed about how long I would have empty properties, I finally had my ads all written and proceeded to post them online with less than stellar expectations. Much to my surprise by mid morning, I already had my first viewing booked for that day. Then another one came for the following day. Then two more for the other property, then a friend’s son came out of the woodwork interested in the third.

The response took me off guard as I was expecting a disappointing response, but it quickly became better and better. Now the key from my viewpoint is as follows, we like to keep our properties well maintained and updated and this is an example of this tactic paying off. Here we are not even a week later and I have all three properties lined up with new tenants. One will be vacant for less than 24 hours!

When chatting with the actual tenants looking for new places, the real view of the market emerged versus the one I was fed by the current tenant. Yes, there are a significant amount of rental properties out there, many at very low monthly rates. However, it appears there is a reason many of them are languishing on the market and steadily reducing rates and it has nothing to do with an over abundance of vacancies. Rather it has to do with tenants having options of where they want to live and they don’t want to live in dumps!

Resoundingly the tenants informed me that a majority of the “cost effective” properties were not places they would choose to live if they had options. During the economic boom earlier in the decade, people took what they could get, now the landlord and property owners that took advantage of tenants and just pocketed all the profits are feeling the results of their decisions.

So the real message behind this article? You really need to talk to the right people to get the real answers. The neighbour, or the tenant or the Realtor may have an opinion, but you have to do your own research to find out how valid their opinion really is and what is actually happening in the market.

In further efforts to streamline the process and to ensure I can get posts out more efficiently I am making a few changes again to the way I send out the posts.

Unfortunately it does require everyone to re-register, fortunately I have a simple form that will make it quick and easy.
 

 
To make sure you are rewarded for having to re-register I am putting together some more great information to send out to all the subscribers that register through this form. My apologies for the extra steps you take, hopefully the free info will make it all worthwhile and you should see it in your inbox over the next few weeks.

Remember this info will only be available initially to the newly subscribed, so please register just once more!

Thanks,

Bill

In a report by the Real Estate Investment Network (REIN) in early August, Calgary was ranked the number 1 city in Canada for Real estate investments. With the slower and shaky economy, the high price of home ownership, forecasts for a slowdown in housing prices increasing interest rates this has come as a surprise to many people.

So where does this type of report get its basis from? First off, the group is basing its pick of Calgary from now until 2015. So while presently it may seem less glamorous to look at Real Estate as an investment, it’s over time that it shines.

REIN bases their decision on several factors that directly affect the value of property. These key factors are population growth, job growth and increasing average incomes. Whoa, you might say! Isn’t Calgary losing population, hasn’t there been layoffs and how could average income be increasing?

This is where the long term five year view comes into play. As the global energy markets continue to stabilize over the next several years and the US continues to increases its dependency on the “dirty oil” coming directly from the Alberta oil sands, Calgary will see its economic stability ramping up. Of course as the energy industry thrives so does the rest of the provincial economy.

Although we are currently seeing a slowdown in inter provincial migration, as more jobs become available and the economy grows, this will once again turn around. Now we aren’t talking 2005/2006 out of control growth, but definitely stronger than we have seen the last three years.

Now the majority of people first moving here are not likely to be home buyers. They tend to be renters who are initially more intent on getting a good job and less concerned about buying of they are unsure how long they will stay. This is what many people who are disregarding the report are missing.

From a home owner’s standpoint, with an average price of over $450,000 for a property that may not be able to increase much is not be a good investment. On the other hand, a $300,000 suited bungalow in a rental neighbourhood that generates $2,200 a month in gross income versus a $1,070 monthly mortgage payment could be a great investment from a Real Estate investor’s viewpoint.

What are your thoughts? Is Don Campbell going out on a limb or does he have a firm grasp on what’s happening out there?

Revelations – Realizing how lucky you really are.

Definition from Bill Biko

Since yesterday there has been quite a few fun little stories pop up, but let’s touch on my definition of revelations first.

As I mentioned, I’ve been getting more irritable for a while now due to myriads of minor and major headaches. These range from a partnership that has been going through a split for over a year and a half, another partner who is managing a property in Lacombe who hasn’t been able to provide any details on the property for over two years and may now be going into foreclosure, being forced by banks to sell properties in a market not conducive to sales, tenants who seem to be more concerned with their welfare than mine and I could probably go on for another thousand words with all the headaches and complaints I have.

All the pressure, all the worrying about everyone else, well it’s just worn me down. Because I have been looking at it as ongoing problems that will never subside and I think that is where the revelation comes in. This all comes back to Tony Robbins new show again, the Breakthrough. Now I quite enjoyed the show as it’s great to see people over come what obviously completely changed their lives, but what I didn’t realize is after the show Tony posts a video explaining some of the background info that gets omitted due to the show’s 44 minute time frame.

It was watching some of this post show video yesterday that I started to realize how lucky I am. Yes I have some big challenges in front of me, but some are transforming as we go along. Last week the year and a half split finally was complete, we received some very positive reviews of the property we are still trying to sell, I’m getting more calls on the vacancies we have, my new business while slowly growing is starting to get some nice results and some referrals, my family still loves and adores me (well maybe adore is strong, especially with how pissy I have been lately, but they still love me!), I have a great home and there is plenty of positive out there.

When I look at the story from the Breakthrough and how the fellow became a quadriplegic who was stuck in his house, afraid to go outside, yet has transformed his views and has become upbeat, positive and enthusiastic about his life and future. Then I compare at how I have started to look at all the negatives without seeing the positives it was a bit of a wake up call.

So while there are no guarantees I will be 100% happy all the time, I will start working on remembering the positives, the good things that are happening and try to let more of the negative wash away.

So with that in mind, here are a couple of developing stories since yesterday. Last night the police stopped by and I was subpoenaed for a courtcase later this month!!

Not against me just in case you were wondering! This relates back to my tenant from last summer who stole another tenants vehicle, cell phone and wallet at knife point. Apparently he and his buddy were caught in Ontario five days later sleeping in the car. I get to show up to confirm he was a tenant and help put him away hopefully for a long time.

The two guys who pissed me off Sunday, well this morning there was an apology text message on my phone. Apparently they are sorry about the misunderstanding and they wish they had taken my place and the fellow who wanted the discount may be interested in coming back at regular price.

I just received a referral yesterday from one of my very happy web clients, not sure how it will turn out, but after a quick look there seems to be plenty I can help them with.

On the slightly negative side, people don’t comprehend ads very well, I have been getting quite a few calls on a rent to own property and another one for a live in manager for another and it’s apparent that I need to write them with more clarity. Obviously including prices, how it works and everything comes across confusing (see look at me finding a humorous bright side!).

There’s been a lot of economic doom and gloom and it’s probably not going away for a while. If you haven’t the time, or had it thrown in your face, about how really good you may already have it, perhaps now is a great time to do so. Happy revelations!

Revelations – Something revealed, especially a dramatic disclosure of something not previously known or realized.

Definition from Answers.com

I was talking with a friend this morning (you know who you are and thank you!) about how angry I am with people lately. Last week I had a former tenant send me an email who discovered a $1,295 judgment on his credit. He stated that I had lied to put this on his credit and he had witnesses about black mould in the property and was considering consulting a lawyer. It pissed me off a bit, so I suggested he go ahead and proceed as I would then have his current address and could go after all the additional charges I didn’t have in the judgment.

It irritated me that he tried to get out of paying originally and when it finally caught up to him, he was still trying to get out of it.

Yesterday I met with two guys from out East who were here to do some promotional work with the Calgary Herald. They called last week and wanted me to hold two rooms for them. They were persistent and very concerned that I had to hold them, so I did. They were supposed to call Saturday to confirm time of arrival, but of course they didn’t so I didn’ t expect them.

Then they called Sunday to say they were here, the rooms weren’t quite ready, so Karen and I had to rush over and prep them before they got there. When they did show up, they didn’t have the money with them for the rooms, and they wouldn’t be able to get it all since they had to withdraw money for traveling earlier that day and had daily limits. Yep, this irritated me too, especially since we had the conversation about costs a week earlier.

So they ran to the bank, came back and wanted to talk to me, in private. So we go outside and they tell me they thought it was too much. They wanted a discount of about 30%. They explained if they ended up staying longer they could rent as apartment for less. So to recap, I held two rooms, rushed to prep them for them, gave them the benefit of the doubt and was letting them only pay part of it up front and now they wanted a further discount. I was furious. I suggested they go get an apartment and walked away leaving them to drive off.

What I’ve been noticing over the last month is I’ve been letting incidents like this get to me. It’s just been a series of little pin pricks that get more and more and more and more and more annoying. The phone call this morning was part one of the revelation that this was happening.

You have to wait until tomorrow for part two!

Just noticed a story out of the city council meeting last night where the council has erased zoning restrictions on secondary suites designated for narrow properties. So what does that mean?

For some reason if doesn’t change anything for older districts that have the nice large lots (the example they use is Haysboro and University Heights) which are more suitable to add secondary suites. It does however affect areas where they cram homes in like Martindale, certain areas of Tuscany, McKenzie Towne, in all about 18% of Calgary homes.

These areas can now have legal basement suites. There are still certain rules to follow, but it cannot be denied due to zoning for these areas now which should take some pressure off landlords hoping to not get reported.

The rest of the story is available on the Herald’s site, Alderman relax suite rules

Just going to throw a few quick thoughts and items out.

Tony Robbins

Tonight (Tuesday July 27th) is the premier of Tony Robbins new TV series. I have long been a fan of his books and audio packages. If you are having some struggles in your life, want some positive reinforcement, or just want to see some stories to make you feel good, check it out tonight.

Here is a link to a behinds the scenes story about the show, Tony Robbins – Breakthrough

Rental Properties & A Lesson

Been a busy week, Karen, the kids and I have been working on a vacant property in Forest Lawn. We are trying to teach the kids the value of working hard and getting paid for it, so our 10 year old learned to paint walls yesterday. She put in a solid two and a half hours and we will reward her for it.

It’s her lesson about life and earning money as she is constantly asking us how she can make money, now she knows and we are taking them back today to finish up!

Getting Things Done

I was up until 2:45 the other night, couldn’t sleep, so I went and worked on some of my web projects. It didn’t hit me until today that I keep falling into the same trap all small business owners have. I’m busy working in my business (as I prepare to go paint again at a rental property), rather than working ON my business.

Most of you aren’t aware I started another business up now as I need something to fill my time.  I have done a ton of research on how to market websites, products and information on the internet over the last few years as I sat on the sidelines and waited for the Real Estate market to settle down. Now I am leveraging that knowledge to help small businesses and a few charities get some exposure on the internet.

You can read a bit about some of it on my new site http://www.billbiko.com.  I do everything from creating blogs for people and companies, http://www.keepingthecirclestrongcalgary.com,  http://www.erelogistics.com, to creating short videos to promote products ERE Logistics Portable Scissor Bridge, or even creating lead capture promotions for companies Granite Countertops Calgary. If you know someone looking for some online promotion let them know about me!!

With so many things on the go, it’s important to get things done! If you don’t get things done, you cannot move forward. This is why it’s so important to take some time to work on your business! Sometimes you just have to block off half an hour to review what needs to be done to get ahead. Anyway, I’m off to get things done now so I can come back and work on my business later!

I don’t understand. I thought I understood it, but I must be missing something. What I’m talking about is the Bank of Canada rate increases. For the second straight time, the prime lending rate has increased. Sure, it was only a quarter of a percent raising the Bank of Canada rate all the way up to .75% %, but it’s quite curious to me. I just don’t believe the current economic situation warranted it.

Especially, when they also release data at the same time they are forecasting economic growth to be slowing, due to household budget cutting. Is this an example of the cart leading the horse or is it chicken/egg syndrome? By increasing the prime lending rate, the cost of borrowing increases which makes mortgage more expensive, pushes rates on credit lines higher, and reduces the amount of cheap capital available to businesses.

This translates into households and businesses becoming more cautious and less likely to grow, to expand or to increase expenditures. All of which are requirements for continued strong economic growth. Now, since it’s not a huge rate increase, it doesn’t mean growth will move to a standstill, it will just slow down a tad. However, once again, is this the best time for that?

Perhaps what is more interesting is that Canada is the only Group of Seven country to raise their prime lending rate since the global recession started. And now it’s been twice in the last several months! What do we know that the other countries don’t? Yes, we came through the global downturn far better than perhaps any other country, but are we possibly shooting ourselves in the foot due to our own prior success?

During the first half of 2010, Canada as a whole saw a tremendous amount of growth and recovery in the housing markets. From Vancouver to Halifax the trend was for property values to increase with Vancouver seeing some huge jumps from the beginning of the year. Much of Canada’s economic growth can be directly pointed back to the growth in the housing market.

From the manufacturing of windows, furnaces, appliances for new homes to the actual construction involving carpenters, electricians, plumbers and more to the lawyers, realtors and banks on the back end, the Real Estate industry as a whole has a significant impact on the Canadian economy. This impact was directly responsible for much of the growth in that first half of 2010, but there are pending and newly introduced factors, such as the rate increase, that will have direct impacts on continued growth.

July brought the Harmonized Sales Tax to Ontario and BC. This tax meant to simplify some of the confusion brought about by separate Government Sales Tax (GST) and Provincial Sales Tax (PST) is directly adding thousands of dollars to home purchases. Since many consumers were aware of these pending increased costs, it helped fuel an even busier first six months of 2010. Most likely it will also lead to an even slower second half of 2010.

We’ve already seen Canada wide home pricing start to stall and even slide in some areas. Now with this new increase in rates, will it cause it to slide even further or will it just be able to maintain it’s flatness? The argument is that over the next year business and trade will provide the impetus for growth in Canada and consumer confidence will be less of a driver for economic growth, but doesn’t it go hand in hand? Happy consumers help boost business success leading to everything growing? While the rest of 2010 will once again be quite interesting, I’m just getting tired of constantly peering ahead to see what will happen and I’m really starting to yearn some consistency with the world!

Here it comes again! It seems as if every street you drive down lately has another house listed for sale with the big shiny Real Estate companies sign out front. Aren’t we supposed to be recovering and home prices were set to rebound? Isn’t the recession over?

Instead, here we are approaching inventory levels we haven’t seen since spring of 2008! That’s when we peaked at around 15,000 listings in Calgary and area. This overstock of properties for sale ultimately led to values decreasing even more and causing a further slowdown in a weak market as properties were everywhere and buyers had little competition.

So where are we sitting now? Well as we hit the end of June, we were sitting with a numbing 14,066 listings on the MLS. That is almost 5,000 listings higher than the same time frame last year! To make this even more frightening, sales are down by over 900 properties from June in 2009. So, once again, does this mean it’s time to panic?

If you are prone to panic, I guess now is as good a time as any, although I believe this will be short term and you might be getting anxious over headlines only. The bad news is prices are going to get pushed down marginally as the extra competition among sellers mounts; the good news is that homes are still selling if they are priced right and my Pollyanna crystal ball still shows considerable upside for the fall.

I’m not expecting prices to plummet a huge percentage; they will most likely come down only 2 or 3% short term as the market once again stabilize and buyers take advantage of frantic sellers. Based on average home prices this should be around $8,000 to $12,000 on a property, which shouldn’t be cataclysmic, unless you were close to 100% financed. Also, by short term, I am not expecting this to last much longer than the summer and then to see another surge of increasing prices again this fall.

You might ask at this point, why I am expecting it to rebound so quickly. My thoughts are that the market slowdown is more directly related to the huge surge in the markets earlier in the year rather than anything else that’s currently taking place.

If you look back to February, March and April this year, there was significant uncertainty how the new mortgage rules would affect home buyers and there was a strong feeling interest rates would be increasing very shortly. This pushed a larger than normal amount of buyers into purchasing sooner than they planned in order to take advantage of low interest rates and easier qualifying.

With this large portion of both first time buyers and home owners being suddenly removed from the market it was bound to slow down as buyers disappeared. Then to top it off, we added in the small increase in interest rates and it managed to push even more buyers to the side as they re-evaluated whether to purchase or wait. Is it any wonder then that fewer homes are selling?

So, here we are in July and people’s thoughts have moved to enjoying the few beautiful days we have during our summertime and less to a new home. However, by the end of summer, this will all change. We should see further stabilization in the economy, allowing more people to contemplate purchasing a new home without the uncertainty of potential job loss, prices will have decreased, making it more attractive and affordable, interest rates should remain steady and the overall mood of the Canadian economy will be once more optimistic. This should plant the seeds for some steady growth during the fall and a great time for the market!

Or at least that’s how I currently see it, anyone else have some alternative viewpoints?

It seems like wingnuts are flying off the shelf these days and I am receiving even more content for a potential book about tenant stories. Here is the email I received the other day in response to one of my weekly rental ads on Kijiji;

I want your condo for 2 days, i m planing on having a party. It’s going to be my Birthday Bash so yeup
let me know if you agree, also let me know how much for a day & i’ll let you know when i want it.
email me asap Please and thank you

So, what do you think, should I contact the person? Seem like a winning solution? Just to show how confounding this is,below is a section from my ad,

To ensure a great experience for our residents the property has the following rules in place;

• no smoking in the home
• no drugs
• no overnight visitors
• treat the other guests with respect
• no parties

These rules help create a safe quiet environment and also discourage the types of roommates we are sure you do not want to share a place with.

I highlighted a couple spots the potential short term tenant appears to have glossed over! Bottom line, I think I will take a pass and not bother to reply, I know, I could be throwing away money, but sometimes you just have to take a chance and pass on an exceptional offer!

Love to hear any stories from you!

With the recent mortgage rule changes and then following that the slight increase in the Bank of Canada’s prime rate, more and more people are sitting back and waiting to see how the Real Estate market will be affected. While the actual sales numbers are decreasing, there seems to still be a steady build up of new properties coming onto the market. This is causing us to tip back over to a buyer’s market, which brings back some of the old challenges for sellers.

Among these challenges are more aggressive pricing demands from buyers as more options or properties are available to them, more restrictive conditions and terms within the actual offers and longer closing periods putting the burden of extra payments on the sellers. So what better time is there to explain some of these additional challenges than now?

Let’s start with some of the tactics buyers use to get a lower price. The most obvious of course is the low ball offer. This is an extremely low offer thrown out quite often, just to test the waters and see how much the seller will negotiate. The counter to this, and to see if the buyer is serious, is to either refuse the initial offer hoping they resubmit an offer at a higher price, or to only reduce your price by a very small amount to see if they come up in price.

If you only reduce your price a bit and they only come up the same amount, they may be trying to move you to a midpoint between your prices. If this is acceptable to you, carry on nibbling downwards, if the midpoint between prices would be too low for you, try reducing a bit more in your second counter, but make sure you make it known you won’t be moving much from your last counter.

The second part of the buyer trying to reduce your price, involves making initial pricing concessions to you and then coming back after a property inspection demanding further reductions back. This can be another tricky area. If the price reduction is based on problems they were aware of prior to the inspection, it is most likely a pricing strategy, if it involves problems no one was aware of (such as hidden roof leaks, or hidden furnace problems), you have to decide whether you want to do the necessary repairs yourself, or concede the expense to the buyer in the form of a price reduction.

The final negotiating area to watch for involves condition dates and closing dates. Unless there are some special circumstances, the condition date shouldn’t be longer than seven business days and possibly less. The condition date is when any conditions such as home inspections or financing are removed and the contract becomes a binding sale.

If the condition date is two or more weeks away, your property would be off the market this entire time and then could still remain unsold. Long closing dates are also used by some nefarious individuals just to lock up properties and in some circumstances to renegotiate later for an even lower price when the homeowners are under more severe time pressures and have fewer options.

When it comes to closing dates, when the property actually changes hands, this is ideally two months or less. If the purchaser requires more time, you have to consider any additional mortgage payments you will be responsible for and you may be able to negotiate a slightly higher price due to this.

Remember these tips work best if you are not in a desperate situation and there is no guarantee that by following them you will sell your home. Every seller and every buyer have their own unique requirements and mindsets when they come to property transactions and what would be perfectly acceptable in one transaction causes another transaction to completely fall apart.