Why won't my house sell?

My wife was recently on the www.beachestoronto.com chatroom answering a question posted by another beaches resident. Her neighbour's house had been sitting on the market for some time and there were some opinions as to why it had not sold. I shared my opinion as well as some stats from the Toronto Real Estate Board market report via her reply to help answer why a home often won't sell...


"A few things to consider:

1. The actual activity in the market of this area is not far below with this time last year in terms of number of sales so things are still going strong. Although you are correct...you aren't seeing the crazy bidding wars quite as much. Current stats show houses in this area during the month of September (classified as 'E02' on MLS) are on the market for an average of 19 days and sell for 101% of list. Average for days on market has only gone up 2 days. Median price is up to $394,000 for all types of homes compared to $373,500 last year. For detached homes it was $506,000 last year and $600,000 now!

2. Overall, three primary elements are going to sell a home - and true, there are some that don't matter to everyone - but generally speaking, we're talking about Location, Condition and Price. If a home shows beautifully, has a great location, but isn't selling, it's usually overpriced. Net net, if you can't adjust location, and the home shows beautifully, then the price needs to be looked at.

You've all probably heard this time and time again but it's true. Many home owners think their home is worth more or have been pursuaded by an agent that it is worth more to get the listing. They want to take a shot at a higher price and see if they can get it.

Unfortunately, the house sits on the market and doesn't sell. Why? Most people and agents search by MLS to scope out what is in their price range. If yours is listed above that range, they likely won't see it. Second, even if they do see an ad or a flyer, they are going to compare it to other homes that are priced properly in that range and it will pale in comparison. Many people ask why a buyer won't just put an offer in. Given the effort, emotional commitment etc. that you get into once you start that negotiation process, unless you realistically think it's going to result in a sale, most people don't want to get into it. Then, the price may get adjusted to the market later but now the house is 'stale'. People wonder what is wrong with it and they've lost the momentum and interest of a new listing.

Case in point. My husband just worked with a client that listed with another agent in the spring who priced it above market. It sat and sat, they dropped the price, and it still didn't sell. They decided to work with him this time based on a referral so it went back on the market last week, priced appropriately (and brought in a stager to make sure it showed as well as possible). It sold in one day above asking price and above what the reduced price had been in the spring. Your agent has to do their homework (they should be providing you with a full comparative market analysis) to ensure you get the best possible price within the current market.

Net-net, the market in this neighbourhood is still going very strong but as long as people respect market values, use the right pricing strategy depending on their goals, and ensure they do everything possible to make sure their home appeals to buyers, then you should have success.

In terms of forecasting the market, no one has a crystal ball and people have been predicting for years that the market is going to slow down - the numbers above are clearly contradicting this. Toronto as a city is undervalued. It depends on your interests...are you getting into the market for the short or long term? The Beach in particular will be somewhat sheltered from any market drops because of it's location. Yes, as interest rates rise buyers will be more hesitant to jump in but overall, better to be in the market than out.