HEATHER GUSTAR - Toronto the Good - Buyers Come From Now?

92% of Buyers of properties in the Toronto Market use an Agent, other than the listing Agent to purchase properties listed for sale. 8% of the Buyers do not have an Agent represent them or use the listing Agent as “their agent”. (PPP survey 2003)

Where do the 92% of Buyers come from who use an Agent other than the listing Agent?

Every Agent meets their Buyers in different ways but in general most come from:
1. Past clients, referrals and people they know, by far the largest group which represents over 70% of Buyers for most Agents.
2. The balance comes from relationships the Agent forms with Buyers from other sources such as:
Marketing their own listings
-sign calls
-internet responses (internet responses from all sources have replaced traditional media ad calls as a major source of new buyers over the last few years.)

How do the 92% of Buyers who buy through a “Buyer Agent” find out about the property they ultimately buy?

Source # 1 The Agent tells the Buyer about the property. Traditionally this was by far the most common way a Buyer found out about a property for sale.
- Agents use their MLS system to search for properties that are listed for sale that match the criteria established by the Buyer.
- Agents find out about new properties from other Agents.
- Agents search out properties that might be for sale from their contact group
- Agents use direct mail or telephone marketing to find potential properties for sale.
- Agents go to open houses to inspect potential properties for Clients.

Source #2 The Buyer tells the Agent about a property they might be interested in. With the advent of the internet and consumer access to most of the properties for sale, somewhere on the web, many (over 70%) of Buyers look to the internet to find properties for sale. Many Buyers now tell their agents which properties they are interested in after finding them themselves.
Sources for Buyers to find out about properties for sale:
- Property match, where the Agent sets the Buyer up on a service where the MLS system e-mails the Buyer possible property matches and the Buyer lets their agent know which ones are of interest.
- National web sites such as MLS.ca, Realtor.com, Homestore.ca
- Franchisor web sites such as Prudential.ca
- Broker web sites such as Torontothegood.com
- Agent’s personal web sites
- Property signs
- Word of mouth

Where do the 8% of Buyers come from that used the listing Agent, either on a customer or a dual agency basis?
The same sources as any Buyer Agent. See above.

When a property is listed for sale there are 5 broad categories of potential outcomes.
1. The listing hits the market; there are multiple offers, the property sells immediately for list price or substantially more.
2. The listing hits the market; there is an offer very soon thereafter, the property sells for list or close to list price.
3. The property hits the market; there may or may not be offers soon thereafter, but none are accepted immediately, a few weeks pass, an offer comes in and is accepted. The selling price is usually within 5% of asking price.
4. The property hits the market; there may or may not be offers soon thereafter, but none are accepted immediately, a few weeks or more pass and no offers materialize or are acceptable. Price reductions take place until the property sells. The selling price can be substantially less than the initial list price.
5. The property hits the market; there may or may not be offers soon thereafter, but none are accepted, there may or may not be price reductions, no acceptable offers materialize. The listing expires or the property is taken off the market.

One more Buyer can make the difference.
1. One more Buyer can make all the difference in the world. Just one more Buyer when there already is one, makes for competition. Competition can mean substantially more money.
2. Just one more Buyer who sees the property soon after it is listed and is set to buy can make a substantial difference to the selling price. If this Buyer doesn’t see the property until after it has been on the market for a few weeks the price usually won’t be so high.
3. Just one more Buyer who puts in an acceptable offer is all it takes to sell.
4. No Buyers no sale.

All it takes is ONE BUYER to make the difference.
There is no guarantee of getting one more buyer or even any Buyer, but not to put the effort into trying reduces your chances. If you have a better chance of getting one more Buyer with one Agent over another, can you afford the risk or luxury of not trying?Agents can and do make a difference.

The difference is the amount of exposure your property gets. The more exposure the better chance of getting that ONE MORE BUYER.

The MLS System. The MLS system is the most important and effective way of reaching the most Buyers in the quickest time. Agents who have buyers actively looking, search the MLS system for properties, or set their Buyers up with an automatic search program to e-mail new listings to them daily. To take advantage of the MLS System, to get the most exposure, the Seller’s Agent has to make sure that:
1. The list price is somewhere near market value
2. The timing of the market is taken into consideration
3. The property description is well written and attractive
4. There are as many pictures as possible to show off the property
5. Some property information is uploaded to MLS.ca in an advantageous way
6. The property is re-run as often as possible
7. That an agent open house is arranged and shown on the MLS system.

The MLS system does not get to all buyers of all agents. Why?
1. Some Agents get too busy and don’t spend enough time searching the system. Listings are entered into the MLS system at any time night or day and the information/data is available to all Agents immediately. .
2. Agents haven’t set up their Buyers on auto email to notify the Buyer or the Agent of new listings.
3. The Agent’s criteria for auto search/e-mail are too restrictive and your property is missed.
4. Many Buyers are loyal to their Agents but are not actively looking for properties with their Agent at this time, but when they see one they are interested in (on the internet or sign etc.) they contact their Agent.
5. Buyers change their criteria and don’t necessarily tell their Agents right away but look on the internet with their new criteria.

The Agent’s Brokerage
An Agent’ Brokerage can have a major effect on the exposure that a property gets. Unfortunately in this day and age most Brokers provide very little in the way of marketing support. Marketing support is now mostly provided by the Franchisor on a national basis or the Agent themselves. There are some exceptions and we are proud to be one of them. Those Brokers who believe that the local market and local marketing is important, make an effort to give their Agents an advantage locally. This is especially important in a market like Toronto. In Toronto it is estimated that more than 85% of sales are of a local nature.

What can a Broker do to help their Agents increase their listings exposure to Buyers?
1. Provide a locally recognized web site to market their Seller’s properties.
2. Provide a system that allows their Agents to promote seller’s listings to virtually all local Agents.
3. Provide a system to direct market to potential Buyers on an area by area basis.
4. Provide support in creating marketing materials and Agent web sites.

The Seller's Agent can make the difference.
By making the effort to create maximum exposure for the Seller’s listing an Agent can make a major difference to the sales outcome.
1. The Seller’s Agent must expose the property to as many potential Buyers as possible especially in the first few days of the listing.
2. The Sellers agent can make a big difference in the sale price of a property by giving valuable advice on what needs to done with a property before it is listed and by properly timing the listing to Agents activities and to the market.
3. The Seller’s Agent has to be knowledgeable about how to take advantage of the MLS system, and be capable of creating a listing that shows the property in the most favourable light.
4. The Seller’s Agent must make use of MLS.ca to the Seller’s advantage.
5. The Seller’s Agent must make use of all the industry and Brokerage systems and programs available, to maximize the exposure of the listing to Buyers.

Big changes have taken place in the last few years in the Real Estate industry that influence obtaining maximum exposure for a listing. These changes are:

1. Buyers themselves finding the properties they want to see.
2. Internet responses replacing traditional ad responses.
3. The inability of some Agent’s to keep up to date with new listings being placed on the MLS system 24 hours a day.

1. Until fairly recently almost all properties shown to buyers by their agents were found by the agent, by searching the MLS system. Now, it is estimated, that up to 50% of the homes bought by buyers are first seen by the buyer on the internet or in an e-mail generated by the MLS system, before their agent brings the property to their attention. The buyer then informs the agent of the properties they would like to see. This is a major change. To create maximum exposure for a listing, the listing must have prime time exposure on the internet and within the MLS system.
2. Before the internet, most agents would get good buyer response from advertising properties in the local media. Today those responses have dropped off dramatically, even in the very strong market we have experienced in the last few years. Ads in traditional Medias are not timely and usually give little and sometimes highly suspect information. They have always been designed to get the buyer to call. Buyers now know they can get much more information on a timely basis somewhere on the internet so they do. MLS.ca gets up to 1.9 million visitors a month who look at over 260 million pages of information. No other media even comes close to this kind of market exposure, not now, not in the past. Never.
3. Agents are busy and can’t be searching for properties all the time. If they do not have the system working automatically to keep them informed at all times of what is going on in the specific markets they are dealing in, they can easily get out of touch. Our Agents use the systems.