Buying and Selling in a Higher Bracket

Past posts have included a lot about low inventory, bidding wars, staging, pricing homes, etc. Most of that information has been centred around the largest area of activity – the under $1 million zone; second or third family home, or downsized home. However, when you get into buying and selling homes over the $2 million mark, it’s a whole new ballgame. Though this price range is also moving well, the pool of buyers is much smaller and prospects are quite different, so strategies need to change.

You Need a Different Advertising Plan

Because the pool of buyers at this level is much smaller, you need to be more selective and wider reaching in who you are trying to attract. Mine, and I assume many brokerages, have a special classification to indicate a home in a higher level price range, which may include a different sign, being pushed out internationally, and more. I usually advertise in higher-end publications, like The Globe & Mail, and glossy magazines. This level of home tends to attract more international interest, therefore a very strong web presence is a must. So is top-notch photography and higher-end printed materials such as glossy, substantial brochures. I may even have aerial photography done of the grounds. Anything perceived as cheap or low quality, will not cut it with buyers of this calibre.

Essential Preparation

Buyers are much more critical at this level, so it has to show extremely well. The home must be prepared and staged flawlessly. You can’t get away with not doing small repairs that you think no one will notice. The only way to achieve this is by hiring professionals and ensuring you plan the time to prepare the home properly before listing. I recently sold a home for $2.5 million. It was done professionally, with attention to detail above and beyond – crown mouldings, paint colours, awnings, etc. – everything was perfect. We actually had a bidding war, which is much less common at this level.

Don’t Expect as Much Activity

So plan accordingly. We know at the lower priced, but high-demand range, agents often slightly underprice homes and set an offer date with the intention to stimulate interest and multiple bids. Buyers of the $2.5 million calibre are fewer, so the number of visitors to the home will be greatly reduced. I would not recommend the underpricing tactic. Sellers need to bring the home to market at an intelligent market value and work to attract qualified buyers. Any agent worth their salt will know what market value is and advise their clients accordingly.

This is another reason you won’t get as much activity – buyers will rely more on their agents advice and research. At this level they don’t want to spend a lot of time visiting several open houses. In fact, I would not do an open house for a home selling at this price level. Potential buyers will look at the listing much more closely online and have their agents preview the house on their behalf before deciding whether it is worth seeing. These buyers not only tend to be busy (aren’t we all), but also likely more experienced and don’t need the education and ideas greener homebuyers enjoy in visiting many properties.

Acting for a $2.5 Million Buyer

When I’m acting for a buyer looking for a home in this range, even more due diligence is required. There are fewer properties available at this level, so it’s even more important to get to know my clients and understand what they are looking for. No matter the price range, I always work hard at this, but it’s even more important for buyers to feel I am in tune with what they’re looking for and that I’m not going to waste their time.

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