STOREYS Custom Studio
When determining your next move into country real estate – whether it’s selling, buying, renting or otherwise – it’s important to listen to your heart.
But while the heart wants what it wants, so do your finances. As such, too Listening to the pros on how best to approach the monetary aspects of country real estate will help ensure that your next move is an overall sound one.
“Let’s say you have an inherited property that you’ve owned for years and love it — your family loves the cottage,” says Ross Halloran, Broker and Senior Vice President, Sales at Halloran & Associates, Sotheby’s International Realty Canada. “But [you’re] increasingly interested in the fact that [this cottage’s] the value has appreciated significantly, especially during the pandemic.
We work with both buyers and sellers. Our team has a reputation for setting new values for properties because [as a] luxury brokerage, we have plenty of tools in our toolbox that allow us to do that.
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The Halloran & Associates team runs a series of programs that support both sellers and buyers in the world of country real estate. For those curious about selling their cottage, but unsure of pricing best practices, Halloran outlines “What’s it Worth”: a two-pronged approach to assessing value. He credits the system to his former partner Roger Kolbuc, a 50-year-old real estate veteran who died last year.
“[Kolbuc] taught us . . . When trying to assess the value of a property, because the sands change quickly, you should first look at comparable sales to see where the market is heading in terms of price.
The next step in discovering the most accurate value assessment is to perform a “replacement cost assessment”.
“[This is] where you are extracting; you remove all values from improvements made to the land and try to figure out what the base value of the land would be if it was undeveloped, i.e. the vacant part of the land. Once the base price of the land has been established, you must calculate a value for each of the improvements that have been added to the vacant land, whether [they] be landscaping, septic tank, dock, driveway, etc. Finally, you need to calculate current construction costs to replace structures on the property, including furniture as upgrades. Although the process is time-consuming, replacement cost estimates help “keep track of real-time replacement costs and are a great tool to augment comparable market analysis.” — to assess the true current value of a property in these changing times. .”
The benefits of market insights from “What’s it Worth” don’t stop at assessing value; they work in tandem with another Halloran & Associates offering, “Unlock Equity – List It & Rent It,” facilitated by a close relationship with Muskoka District Rentals
“Mary Rose [Coleman] and I founded Muskoka District Rentals (MDR), which is one of the leading full-service rental agencies,” says Halloran. “We are therefore in a unique position to be able to match potential buyers with chalets, both as leading agents for Sotheby’s, but also by having this working knowledge of the rental market and informing potential buyers of the income that a chalet could generate in the rental market.
Indeed, the Halloran team works alongside MDR to identify buyers interested in letting properties after purchase. Because they view properties from both a resale and rental perspective, Halloran & Associates can advise buyers of realistic rental income — which can help them offset cottage costs — Or, says Halloran, sellers keen to explore a new lake will have a rental ‘war chest’ at their disposal, safe in the knowledge that they sold their cottage before interest rates rose further (and cooled the market) . Additionally, the previous owner of the property can often be given the opportunity to access and use their old chalet-sale position by renting it out to the new owners.
READ: How this Cottage Country real estate team prepares the perfect land for luxury sales
Buyers will also benefit from the information this luxury cabin brokerage has on its listing. Halloran’s own advanced “Deep Dive” due diligence enables buyers to enter offers with a solid foundation of knowledge and confidence.
“[In ‘Deep Dive,’] I will do a current market analysis on the property, then I will do the replacement cost, then I will make adjustments for what will happen if it is a multiple offer situation; adjustments on percentage increase from listing,” he explains, noting that last year using this formula, he landed between 1 and 2 percent on each multi-offer sale. “We take a very analytical approach to our business and try to keep the emotions out of it. Enough people will inject emotions when they find their dream cottage, but they won’t really feel comfortable moving forward unless they have the empirical data. In short, we give them the stats so they can follow their heart.
Also enhancing the buyer’s experience, Halloran & Associates’ “Test Drive Your Dream Home” allows qualified buyers to rent a property they wish to purchase and then credit up to 50% of their rental costs for the new cottage, if they choose to seal the deal. Meanwhile, Coleman’s own “Welcome to our Stage” includes curatorial staging that breathes new life into a space while respecting its roots, which can ultimately speed up a listing’s sale.
Halloran & Associates is exceptionally equipped to help sellers and buyers navigate the tricky waters of country real estate while helping the homeowner safely offset the costs of cottage ownership. Ultimately, with Halloran & Associates, experience really does matter.
Cover image: 1044 Russells Lane, Gravenhurst (Halloran & Associates)
This article was produced in partnership with STOREYS Custom Studio.
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