In an ever-tight market, renowned Mont-Tremblant real estate broker Michel Naud advises those who love their homes to keep them. La Presse spoke with him while he was at the Engel & Völkers International Real Estate Convention in Las Vegas. With 30 years of experience, he identifies five mistakes to avoid in 2022.

 

Michel Naud has just put Mario Lemieux's Mont-Tremblant residence, a $22 million castle, up for sale. Over the past 30 years, the real estate broker has participated in more than 1,000 real estate transactions in all price ranges, both in seller's and buyer's markets. In 2022, as the real estate craze continues, he is adamant about advising his clients.

«I get calls from clients who say they'd like to take advantage of the market to sell and secure their future. OK, great, that's a good idea, you could sell your house for a lot more than it was two or three years ago. Up to 50% more. But where are you going to go?»
-Michel Naud, real estate broker in the Mont-Tremblant region

« That's the big question, he continues. Even I thought about doing the same thing with my house in Mont-Tremblant, but I have no solution. The place I'm going to go is going to cost me a lot more anyway. If you don't have a plan B, keep your house!  », says Michel Naud in between two real estate conferences in Las Vegas. Michel Naud says he is taking advantage of this international event to network in the high-end market in order to find a buyer interested in the Mario Lemieux property.

Because if there are wealthy people in Quebec interested in this type of residence, as well as in Ontario, it is very likely that the buyer will come from the international markets, explains the broker. The Mont-Tremblant region attracts many Americans, French, Mexicans, Asians and Africans, he says.

 

Three trends seen in Las Vegas: Bitcoin, metavers and TikTok

At the real estate brokerage firm Engel & Völkers' event, Michel Naud took the opportunity to learn about new industry trends. Buying properties with bitcoins has been the talk of the town, he recounts, especially in terms of how the funds and commissions will be delivered. "I'm not sure I want to touch that," he clarifies.

While a few bitcoin real estate transactions have been recorded in the U.S. so far, sellers and buyers face some notable hurdles: both parties must be willing to proceed via cryptocurrency and hold accounts, the value of bitcoin fluctuates, sale prices are still in "traditional" currency, and buyers are converting their cryptocurrency to get a mortgage.

A second phenomenon that attracts attention is the purchase of luxury properties in the metaverse. Since the middle class cannot afford a 22 million dollar property, for example, in the real world, some people choose to buy it in the metaverse in order to live their dream virtually.

« We were all experienced brokers and we were all stunned by the metaverse phenomenon, reports Michel Naud. Will there really be a resale market for this », he wonders.

While COVID-19 has pushed a market that has remained marginal until now, namely the sale of properties through virtual tours, Michel Naud says he often sells condos in the mountains without buyers visiting them once... In this resort market, he still says he prefers to see the emotion of customers in person. And the new trend he will have to adjust to is TikTok, which is now becoming a promotional tool for brokers.

« TikTok's audience is younger, but we realize that there are young people with money. »

 

Five mistakes to avoid in 2022

1. Thinking that overkill is an urban legend

Even though it's been talked about since June 2020, many prospective buyers are surprised when they come face to face with this reality. « When I have a client visiting, I say: “Do you understand the market you are entering into?” Often, the bonus is going to be 10% above the asking price, sometimes 20%. The $500,000 property market, for example, will end up at $600,000. »

2. Hiring an out-of-town broker

A local broker who knows his market, the price of properties and the latest overbidding is likely to be more efficient," says Michel Naud. « He will also have quick access to information regarding building regulations, contacts with the land surveyor or a building inspector who can give him a quick opinion. »

3. Making offers without mortgage pre-approval or proof of funds

« If you are not ready, the seller will never consider your offer. I've seen sellers accept lower offers because other buyers had put financing conditions. »

4. Making an offer without inspection

« As a broker, you have to suggest inspections," he says. But in such a crazy market, without pretending to be a home inspector, the broker can see major defects. The seller's declaration is also a very helpful tool. »

5. Exceeding your budget

When the buyer gets pre-approved, they have an idea of their borrowing capacity. However, they must take into account other expenses that could be added, such as a roof to be changed, a drain to be redone and furniture to be purchased. « Some people get emotional and stretch their budget. »

 

And if there is nothing in our prices ?

What does the broker advise a buyer who, seeing the sales that always close at a higher price, realizes that he cannot afford to buy? « This is the killer question. There is no answer. As a broker, we say: “If you don't go now, understand that the next property that fits your criteria will be even more expensive. Either go now or wait and pay more.”

« What's amazing is that despite being in a seller's market, there are a lot of buyers. People don't believe that prices will go down. And neither do I. I don't think it's going to continue to grow like it has for the last two years, but since there's a lack of inventory, there won't be a drop in prices. »

By id3tech