Does new offer wording encourage real estate ‘bully’ bids?

A house on Bain Avenue sold recently for an eye-popping amount above the asking price.

But that’s not what had Toronto real estate agents talking.

The agents were surprised by a phrase that showed up in the listing information available to potential buyers.

“The seller reserves the right to consider pre-emptive offers.”

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It’s a recent development that agents say increases the stress for buyers and undermines their bargaining power. But Bosley Real Estate Ltd., which is adding the phrase to its listings, says it protects the seller while cautioning the buyer not to sit back and wait.

In the Bain Avenue case, the agent was holding back offers until a set date and time. But he was also signalling that the sellers may be willing to look at an offer before that deadline. More commonly known as “bully offers,” pre-emptive bids are usually initiated by a buyer who doesn’t want to play by the rules and enter a bidding war.

Alan Dudeck, a real estate agent with Sutton Group – Associates Realty Inc., had clients who were interested in the house and were planning on tabling a bid on offer night.

But once they saw that phrase, they felt obliged to move right away or risk losing out to another bully.

“My client said, ‘we have to prepare an offer.’”

Mr. Dudeck followed his client’s direction and prepared an offer for $110,000 above asking for the listing agent, Christopher Kelly of Bosley Real Estate Ltd. Mr. Dudeck said the seller decided not to look at it.

Just because they “reserve the right” to look at a bully offer, doesn’t mean they shall, points out Mr. Dudeck.

After that, the listing appeared to be reworded to say the seller “will not look at any pre-emptive offer.”

But Mr. Dudeck’s clients – who decided not to return on offer night – felt very manipulated. Mr. Dudeck felt bad that they had felt pressed.

“I’m out in the field – a busy agent – the last thing we need to do is incite buyers to move ever faster than they already do.”

As it turns out, the seller did very well by waiting for the offer night: the house, listed with an asking price of $849,000, sold for $1.1080-milllion, he says.

And Mr. Dudeck’s clients fared well because they ended up with a house that cost them less than they offered for the house on Bain.

But why add the phrase that the seller reserves the right to look at pre-emptive offers and then not do it?

Ann Bosley, vice-president and general manager for Bosley Real Estate, says the firm added the phrase to listings after the Real Estate Council of Ontario (RECO) strengthened its guidance on the rules surrounding bully offers.

Sometimes sellers vow they won’t look at a bully offer but they become tempted if one arrives. Listing agents are always obliged to notify the seller.

“From our perspective, we can’t control our sellers’ minds.”

She says it also informs the potential buyers that the schedule could change.

“Don’t relax and sit back on your haunches and think you have five days because you may not.”

She believes the policy is working fine, adding that it’s necessary because pre-emptive offers have become increasingly common with listings so thin in Toronto.

“It’s a product of a market that doesn’t have enough inventory.”

Listing agents who receive a bully offer are obliged to notify everyone who has expressed interest in the house so that they can come to the table too. That typically means that the listing agent will contact everyone who booked a showing or left their card or contact information at an open house.

RECO’s deputy registrar of regulatory compliance, Bruce Matthews, says the organization has clarified expectations for listing agents. Under the code of ethics, a listing agent has an over-arching responsibility to contact all the interested parties at the earliest practical opportunity when a bully offer arrives.

“As soon as it’s in your hands,” Mr. Matthews says of the timing.

He says the organization has received some complaints from consumers about bully offers.

Listing agents who establish a deadline for offers put the obligation on themselves to follow that practice, he says, adding that information about the offer date is on the multiple listing service, it needs to be changed.

He considers it an unusual practice, however, to add a phrase to the listing that states pre-emptive offers will be considered.

Christopher Bibby, a real estate agent with Sutton Group – Associates Realty Inc., also encountered a listing that stated the seller had the right to look at pre-emptive offers.

His clients also felt the need to jump in with a bully offer. In that case the seller looked at the offer – for full asking price and meeting all of the seller’s conditions – and rejected it.

“I don’t think it’s fair to prospective buyers,” he says.

Mr. Bibby says by making the pre-emptive offer, he has already shown his cards before the offer night. His clients decided not to go back to the table.

By setting an offer date while also signalling that bullies can step forward, the listing agent is, in effect, saying “offers any time,” Mr. Bibby argues.

“It’s just sending a mixed signal to the consumers if you’re willing to entertain a bully offer,” he says. From the buyer’s agent point of view, “You’ve basically shown them what you’d be willing to pay before the offer date and you’ve set a precedent.”

He says listing agents will also sometimes change the offer date, or change the rules for presenting offers. He argues that the schedule of events should be set out with full transparency.

“You never know what’s actually happening behind the scenes,” he says.

One of RECO’s main concerns is to protect and educate consumers, Mr. Matthews says.

“If you’re going to change the rules of the game, you’ve got to let everyone know that the change has taken place.”

As for whether a seller chooses to look at a bully offer, that is completely their choice. Mr. Matthews says listing agents should have written instructions from sellers.

“We don’t regulate the conduct of sellers. Sellers can put into those written instructions any directive that they want.”

Mr. Dudeck says he believes any tactic that puts even more pressure on buyers is ill-advised.

“There’s enough heat and energy – we really don’t need more fuel for that fire.”

Follow on Twitter: @CarolynIreland

Article source: http://www.theglobeandmail.com/life/home-and-garden/real-estate/does-new-offer-wording-encourage-real-estate-bully-bids/article21378566/

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Four exciting trends in tile design showcased at Cersaie in Bologna, Italy

Tile has a rich and varied history in decor, from Roman floor mosaics to majolica to Delft ceramics to Mexican terracotta. These styles and more continue to inspire artistry. Many of the newest collections of ceramic and porcelain tile were on display this fall at the Cersaie international exhibition in Bologna, Italy. Some trends:

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Master impostors

Faux finishes ruled. What seemed to be barnwood or other planking was actually porcelain. Manufacturers can now produce tile that looks – even feels – like wood, marble, granite or cement, but is thin and lightweight. The application advantages are obvious: A 20-foot slab of slim porcelain printed to look like stone is a lot easier to make and install than the real thing.

Advancements in digital printing have taken faux finishes a long way from earlier versions that looked unrealistic and one-dimensional. Now the detail is more precise, the image is deeply embedded and the surface texture is transformed.

In the U.S., the Reclamation collection from Crossville is comprised of an urban-industrial mix of cement and tiles that look like salvaged wood, while Italy’s Serenissima Cir got hold of a palette of brick from Prohibition-era Chicago and used it to create a collection that looks and feels like time-worn brick.

Unusual sizes

Tile has typically come in standard sizes, squares and rectangles measuring between four inches and 12 inches. But larger versions up to 24 or even 36 inches are now available, and the faux-wood ones resemble planks. Dwell Patterns has collaborated with California’s Heath Ceramics on a hip-looking collection that incorporates a diamond shape and two different hexagonal ones, available in a broad colour palette.

Unica by Target Studio’s Origami collection added subtle textural patterns to tone-on-tone black, white or grey tile in shapes evoking the artistry of Japanese paper-folding. Another fresh idea was Mirage’s XGone series of hexagonal tiles. Several sizes include some that are notched to connect to others; the resulting pattern had a modern-art vibe.

Old World and vintage

Neoclassical and oriental tapestry and lace patterns turned tile into elegant wallpaper in the Onice and Wallpaper collections at the Marazzi booth. The company also showed an oversize vintage floral in a new way, as a ceiling-to-floor accent on an otherwise solid-colour wall.

Ancient Mediterranean motifs printed on matte-finish tile in faded, organic hues bridged the centuries: Panaria’s Memory collection recalls Provençal paver patterns of the late 1800s. Ceramica Bardelli featured the work of London designer Robert Dawson. He took the classic Willow porcelain design, deconstructed its chinoiserie elements and printed them on large-scale tiles.

Tile as art canvas

Ascot has launched Game of Fifteen, a series of tile designs honouring contemporary art. Keith Haring’s radiant baby and running figures pack graphic punch in black on glazed white ceramic.

Follow us on Twitter: @globeandmail

Article source: http://www.theglobeandmail.com/life/home-and-garden/decor/new-trends-in-ceramic-tile-designs-showcased-at-cersaie-in-bologna-italy/article21369393/?cmpid=rss1

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Toronto investors raise prices in nearby areas

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Article source: http://www.canadianrealestatemagazine.ca/news/item/2268-toronto-investors-raise-prices-in-nearby-areas

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Doug Ford promises to cut Toronto’s land transfer tax

Despite repeated mistruths and promises to cut taxes his competitors call irresponsible, Doug Ford was celebrated at a debate hosted by realtors on Tuesday.

Ford’s defining salvo Tuesday morning at the Toronto Congress Centre in Etobicoke in front of members of the Toronto Real Estate Board was pushing a platform promise to cut the land transfer tax, which he introduced earlier this month in his bid to replace his ailing brother as mayor.

“We will make sure that we eliminate, right off the hop, 15 per cent of the land transfer tax,” Ford said. “A lot of my friends here want to tax, tax, tax, spend, spend, spend. I don’t believe in taxing and spending. I believe in saving and putting money back into the peoples’ pocket of this great city.”

Ford has previously promised he would cut up to 60 per cent over four years.

Cutting the land transfer tax was a promise made by his brother Rob Ford four years ago. But the Fords were not able to scrap the tax without the support of council. During last year’s budget process, city manager Joe Pennachetti said the tax has allowed the city to balance the budget for the past three years.

After the debate, Chow told reporters that Ford’s promise could cost an increase in property taxes by 10 to 15 per cent. She said that would be “unacceptable.”

During the debate, she defended her position to keep the tax despite loud booing from the crowd.

“I’m just being upfront,” she said. “It’s $300 million and every $25 million is a 1 per cent property tax increase. What you do if we are to reduce the $300 million in revenue, the city’s property tax will dramatically increase and we cannot allow that to happen.”

Tory, who also found support with the realtor crowd despite arguing to keep the tax, said the Ford’s did not deliver on the promise they made four years ago. He said the revenue is needed for big budget items like public transit.

“I don’t believe you can start doing away with taxes of any kind before you spell out where you’re going to get the money from to replace it,” Tory said during the debate. “When he was told he couldn’t four years ago, in fact, he and his administration didn’t and that’s because it wasn’t realistic then and it isn’t realistic now. I wish I could tell you what you wanted to hear.”

In 2013, the land transfer tax brought in $357 million. With the cuts Ford is proposing, he would need to make up $214 million in revenue. He has previously said that at least $90 million would come from outsourcing garbage in the east end and at least $50 million in other efficiencies. But that still leaves the city at least $50 million short.

Earlier in the campaign, a joint press release with TREB said Ford would be meeting with the board to discuss the tax.

The candidates debate again Tuesday night at the University of Toronto Scarborough.

Article source: http://metronews.ca/news/toronto/1189739/doug-ford-promises-to-cut-torontos-land-transfer-tax/

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