2010
Table of contents In this issue... 2. Message from the CEO
18. The Red Market
Reasons for optimism abound
4. Escape pricing pressure
Royal LePage’s official online store
20. “A” for Attitude
Get paid what you’re worth
6. Royal LePage Marketing Centre
How your attitude affects your business
22. Royal LePage public relations
The resources you need to lead in your market
8. Learning for life Royal LePage is behind your professional development
Keeping a finger on the pulse of the Canadian real estate market
24.
Going mobile Mobile fast becoming the electronic device of choice
10. Royal LePage Shelter Foundation Putting abuse out of commission
26.
GetHomes.ca lead generation Online lead generation is a tool for your success
12. Royal LePage events Top 5 reasons to attend an event
27. Partners Preferred partners and suppliers
14. Leading Real Estate Companies of the World
28. 2010 Recreational Property Report
Your U.S. and international broker-to-broker referral network
Canadians pursuing recreational properties for lifestyle
Leading Edge Magazine is published annually by Royal LePage Canada, 39 Wynford Drive, Toronto, Ontario, Canada M3C 3K5. Please contact us by email at marketing@royallepage.ca or by telephone at 416.510.5800. Contributors: Brian Buffini, Patricia Burton, Nelia Carreiro, Wayne Einhorn, Sandra Diaz, Tammy Gilmer, Jocelynne Haslett, Trea MacPherson, Kelly McCain, David McFarlane, Phil Soper. All Royal LePage products and services are subject to change. For the most up-to-date information, please visit www.rlpnetwork.com. © 2010 Brookfield Real Estate Services Fund.
Fall 2010 | Leading Edge Magazine | 1
Message from
the CEO
Reasons for optimism abound
Those of you who have heard me speak on the long-term future for our profession, and my perspective on where we’re headed as a country, know that I am an optimist on both counts. Both Canada and Royal LePage have enjoyed a remarkable run this past decade, with growth that consistently outpaced other countries, other industries and other companies. My rosy prognosis for our future is based upon fundamentals already in place. And the belief that leadership in our country will continue to do the right thing – more or less. Understanding Canada’s place in the world is helpful in determining the future of our country’s real estate market, so let me start with a bird’s eye view of Canada. Yes, we rocked the planet as host of the Olympics, but I’m referring to what gives strength to our economy. Canada’s somewhat stormy but high profile hosting of the G8 and G20 summits highlighted our position as a global economic powerhouse. In the next few paragraphs, I’ll provide my perspective on Canada’s political and financial soundness and our competitive strengths and weaknesses, relative to other nations. This is not a complicated macroeconomic perspective, but one which I believe can be boiled down to what real estate professionals do each day. And by extension, I hope that it will assist you in articulating to your clients why there is almost never a bad time to invest in real property in our country. Inventory A flourishing real estate industry is dependent on a few fundamentals: the total number of homes available for sale must increase over time, the number of buyers must grow, and the income of those buying houses must appreciate. Luckily, we are in an industry where the total inventory of products for sale is always increasing. A property, once built, is permanently added
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to inventory. Even in bad years, we build many houses. Canada finished 2009 with our home builders on track to add more than 100,750 houses to our inventory of ‘future product’ in 2010. Population growth Of course builders only build if there’s someone to sell to. Population growth is a category that Canada excels in, relative to much of the developed world. While Canadians are not reproducing enough to grow our population, we are producing more future homebuyers than many other countries. The real success story rests in our ability to attract immigrants from around the world. Each year, a quarter of a million new people arrive on our shores from every corner of the planet. The ‘brand’ that is Canada is in high demand among those world citizens who have the means to relocate their families. Think of ‘Canada’ as the nation-equivalent of Royal LePage. We are able to recruit the best and the brightest! Employment and opportunity As gorgeous as our beaches and mountain vistas may be, the world’s migrants aren’t buying a ticket to Halifax, Montreal or Calgary for the great weather. They head our way because this is a safe, healthy, tolerant place ideal to raise a family. We have wonderful programs and institutions dedicated to educating our children and healing our sick. And we have jobs. Good jobs. How are we able to do this? As we march through this high level view of Canada’s competitive strengths, it all comes back to where the work is.
that is truly unparalleled. We have immense energy assets; fresh water; timber; vital and precious minerals. The long list of natural resources that Canada possesses is truly a treasure trove of riches. Since the industrial revolution, nations have pursued job creation through industry – the manufacturing of raw material into finished goods. However, less than 11% of Canadians now work in the manufacturing sector. Knowledge-based jobs So where are the jobs? In real estate, of course! And in other professional sales occupations. In financial services. In medical services. Information technology. The law, accountancy, travel and tourism. We have become a nation of skilled ‘knowledge workers.’
Canada scores very high marks. In the middle is manufacturing, where we score low in terms of global competitiveness. Increasingly, so does the United States and most countries in Europe. Finally on the right of the graph we have competitiveness in the services economy. Canada, with its highly educated, skilled workforce, scores high marks again. As I said at the outset, this is a simple view of economic place in the world. It doesn’t look at our productivity relative to other developed nations, for example. It is an area where for too long Canadian business has relied on a weak currency to help sell goods and services abroad. Perhaps a topic for a future essay! The point is, reading the economic tea leaves tells a happy story. The coming decade should be one of increasing prosperity for Canadians – and Canadian REALTORS®!
Big smile: one, two, three. The world is a competitive place. Capital and jobs flow to the countries that make the most sense economically. In Canada, we start with a natural resource advantage
Canada’s economic future is what I call ‘the big smile.’ Imagine a graph, where the higher up you go, the more competitive the country is in a given category. On the left is the measure of wealth in natural resources.
Phil Soper is the President and Chief Executive of Royal LePage Real Estate Services and can be reached at president@royallepage.ca.
Fall 2010 | Leading Edge Magazine | 3
Escape pricing pressure Get paid what you’re worth by Wayne Einhorn, Co-Founder, Entrepreneurial Development Institute Most consumers have a tendency to oversimplify anything that they do not fully understand. This is the reason why we are so easily manipulated by the media and advertising. We are products of an impatient culture – we do not invest our time easily. Rarely do we as consumers invest the time to understand the true value of our purchases unless it is readily available. How many of us investigate value thoroughly when we purchase a car? If we did we would compute value in the following way: • What is the estimated annual maintenance cost? Cost for brake work, filters, oil change, tune up, etc. for the particular model of car; • Cost of tires, insurance, body work, replacing a key, or a computer chip. The cost of other major repairs and the history of occurrence for the particular model; • Warranty costs and resale value, and; • Finally, how all this comes together in an overall value calculation incorporating price as only one variable. This process is just too much work for the average consumer and therefore it is easier to oversimplify and allow ourselves to level the playing field. In the end, we justify it by generalizing and concluding that “they are all the same.” This behaviour exists in almost every industry, validating that human nature, like water, often takes the path of least resistance. The internet has accelerated this desire to commoditize. Consumers are able to shop a need and look at hundreds of sources in a matter of minutes. An individual can open multiple windows and compare vendors side by side without even getting up from their breakfast table. The only differentiator
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becomes price. Therefore, this simple approach promotes the trend of turning our products and services into commodities. Other examples of this trend include hotels, flights, and rental cars, all of which have been largely commoditized through pricing comparisons at sites like www.expedia.ca or www.hotels.com or www.hotwire.com. Our services in the real estate industry are no exception. We are often compared with the competition solely on commission rates and never on the value that we provide. Would you ever consider shopping online for the best price from a doctor, dentist, or even a chiropractor? As such, we have not seen these professional service providers competing for business on a common website with price as their key customer benefit. Some industry players don’t actually believe that we’re worth the money we charge. Although it rarely happens in public, there are those among us who believe that we are not worth what we charge. They are the segment of the industry that quietly discounts commission hoping no one will notice except the client making the decision on the specific deal. This business model
is a downward spiraling plunge into nonprofitability. I would urge anyone who wants to discount the price of their real estate services to take an honest look at their costs and their operating risk. Often, when considering our pricing model, we forget to factor in the real costs of our business; the risk associated with our revenue model, and, the lifestyle we are working for. The true test is the real value we bring consumers and our ability to communicate it. If we do not believe what we are worth, we do a poor job of illustrating our value to the consumer. Once we have a hard look at our pricing model and understand that we are worth every penny we charge, we have to become experts at illustrating our value to the consumer. If the tens of thousands of realtors were unable to pay the significant fees paid to MLS providers and real estate boards, who would maintain the data that so many buyers, sellers, banks, trust companies, and other industry stakeholders depend on? How can you translate this and other benefits into an explanation of tangible dollars that you will contribute to your client’s proceeds? We provide the practical answer to this question and
start this analysis by documenting an understanding of our competitors. We do not understand our competitors in a comprehensive way. Our competitors can be broken down in three main groups and each has specific characteristics that will affect the proceeds of a transaction: The For Sale By Owner Option: • What are the real costs of the transaction?
Most of the industry is unable to demonstrate, in simple terms, our differences in value to the client. This forces most agents to spend more time talking about cost with the client and inevitably leads to commission cutting. It is not that most of us cannot explain the “dollarization” above anecdotally to the client. The real problem is our presentation to the client is complex and the client does not understand the impact, therefore it causes the client to go back to comparing what they do understand; commission cost to them.
• How much does the owner value “time?” • What impact does experience have? • What is the success rate? The Discount Broker Option:
In today’s world each competitor in our transaction is providing a laundry list of features and benefits and they all look compelling to the inexperienced consumer. We need to take the responsibility of presenting a simple analysis and focus this analysis on the needs of the vendor.
items so that you can produce a simplified version of the tool yourself. Action Items • List all of your competitors in the three main groups • Understand what they offer the consumer • Define your competitive differences • Dollarize the cost or benefit of each of these differences as it relates to the consumer • Ensure you “dollarize” the cost of time in the analysis • Calculate the overall impact and compare to the competitors in the analysis
• What is the true cost of a discount brokerage? • What other services are not offered that will affect the convenience, speed and security of the sale and what impact does that have on “net proceeds?”
Rarely do we as consumers invest the time to understand the true value of our purchases unless it is readily available.
Other Full Service Brokerage Options: • What are your unique and compelling selling propositions as compared to other full service brokerage competitors and what is the affect on the deal proceeds?
They want to sell their homes: • In the least amount of time • With the fewest hassles
• What other differentiators benefit your client and what effect do they have on proceeds?
• Receiving the most amount of money or net proceeds
We must analyze all of the characteristics of each of these competitors and “dollarize” their economic impact to the proceeds of our client’s transaction. Only then do we understand our competitor in relation to our own offering with a detailed breakdown regarding the effect on net proceeds. This understanding is a start but is not enough to alleviate pricing pressure.
Knowing this, we now need to create a tangible dollarized value proposition that identifies the features and benefits as it relates to the client’s needs. At Entrepreneurial Development Institute (EDI) we have developed simple tools and online “wizards” that help customize a value proposition for our members. We have taken the time below to list a number of action
Your final analysis should provide your customer with a real dollar value supported with factual detail based on your assumptions. Any financial benefit will now more than offset your commission rate as compared to your competitor, effectively providing a tangible net value for your service. The process of analysis can be complex, yet the presentation and conclusions are simplistic. The client is now ready to pay your commission rate with the expectation of a far greater net return.
Wayne Einhorn is co-founder of the Entrepreneurial Development Institute (EDI), a leading coaching, consulting and training organization. For more information, please visit www.edicoaching.com
Fall 2010 | Leading Edge Magazine | 5
Royal LePage Marketing Centre The resources you need to lead in your market • Buyer Marketing - Tools to help you work with buyers • Customer Relationship Management (CRM) - Tools to help you build repeat and referral business Building that competitive edge:
The Royal LePage Marketing Centre is a robust online resource to help you build your business and better serve your clients. Choose from hundreds of professionally designed print, email and web templates to create customized marketing pieces. Then distribute them via mail, email, web hosting or through drip campaigns. Plus, with more than 1,000 stock images, numerous industry articles, and new proprietary tools added each month, the Royal LePage Marketing Centre is a valuable resource for your marketing needs:
• Prospect Marketing - Tools to help you generate leads • Prospect Management - Tools to help you convert leads to sales • Listing Marketing - Tools to help you work with sellers
Broker of Record, Barbara Stranks of Royal LePage First Contact Realty has set her team up for success. Two years ago, she evaluated her business operations and came up with a solution to improve agent productivity and enhance the professional image of her office. She hired a dedicated marketing resource to take care of her 100+ agents’ marketing collateral needs. Marketing Coordinator, Lee-Anne Renton, chooses from a wide variety of Marketing Centre templates to personalize collateral for each agent and give them a competitive edge. 99 per cent of the office’s marketing collateral is created using the Marketing Centre. The agents simply provide Lee-Anne with their requirements and she quickly produces their marketing pieces for review without delay. All that
97% of Marketing Centre users said it has helped them to grow their business.
Key Marketing Centre statistics: • 72 per cent of the 2009 National Chairman’s Club* winners use the Marketing Centre. • According to the 2009 spring and fall REALTOR® marketing surveys, 97 per cent of Marketing Centre users said it has helped them to grow their business. 6 | Leading Edge Magazine | Fall 2010
the agents need to do is collect their colour print jobs when they need them. By extending this service to her agents, Barbara has freed up a substantial amount of their time, allowing them to do what they do best – buy and sell real estate. Barbara contends that allowing her agents to play to their strengths and to leverage the Marketing Centre, is the best thing she has done for her business. Since implementing this solution her market share has increased and client satisfaction has reached an
all-time high. Furthermore, the agents love it because of the increased repeat and referral business they receive as a result of using high quality, professional marketing collateral. “As of 2010, I have been in the real estate business for six years - an award winner every year. I attribute much of my success to the resources made available through Royal LePage, like the Royal LePage Marketing Centre. The marketing tools are fantastic and a
must-have for any real estate professional who truly wants to portray a leadership position in their marketplace. The Marketing Centre is not only easy to use and implement, but from my experience, it holds the keys to a successful career!” - Denise Dilbey of Royal LePage Meadowtowne Realty To learn more about the Marketing Centre, visit us online at marketing.rlpnetwork.com/mc
*Top 1% of the Royal LePage residential sales force on a national level based on earnings.
Top 5 Most Popular Marketing Centre Templates: 1. Feature Sheets (44 per cent)
4. Postcards (7 per cent)
2. Slide Shows (13 per cent)
5. Print Newsletter (5 per cent)
3. Web Commercials (9 per cent) Fall 2010 | Leading Edge Magazine | 7
Learning for life Royal LePage is behind your professional development cent of Canadian adults, who were not already enrolled in full time education, participated in education and training activities. When you make time to attend a webinar, take an online course, or participate in a workshop, you are putting yourself among the minority and gaining a key advantage in the marketplace. Real Estate is one of the most competitive industries around. Whether you live in a large city or a small town, there’s always another REALTOR® who is able to deliver similar real estate services as you. In addition, companies offering ‘services’ for FSBOs are vying for their share of the market. To remain competitive in this environment, you need to know your value proposition, and how to leverage it.
Real Estate professionals are busy people, so it’s easy to get so caught up in the daily demands of the industry. Royal LePage Learning Services are here to make the commitment to professional development as painless and rewarding as possible. Understanding the benefits of lifelong learning helps to illustrate why it’s so important in the Royal LePage framework of services. So much so, it is considered a cornerstone to our competitive edge. Learning helps you change with the times. We live in a knowledge-based, technology-driven world. Taking time to improve your technological knowledge will help you leverage technology in your business. With nearly two-thirds of first-time buyers (and almost 40 per cent of all buyers) coming from the Millennial Generation1 (also known as Generation Y), the ability to use technology in your business is critical to sustained success.
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In addition, learning about time management or business planning, for example, can help you examine your own
When you take the time to develop yourself, whether by learning new marketing ideas and techniques, or earning an industry designation, you gain one more way to differentiate yourself from your competitors.
When you always have new things to try in your life, things you still want to know about, you continue to have something to look forward to. – Julia Barnard processes and make them more efficient. It allows you to become a proactive driver of change, instead of someone who has had change thrust upon you. Learning provides your competitive advantage In a study on education, Statistics Canada found that just under 27 per
Royal LePage Learning Services puts a wealth of learning resources at your fingertips. Royal LePage has numerous training opportunities to incorporate into your lifelong learning strategy. Whether you want to take an online course while relaxing at home, or would prefer to join us at a workshop and network with real
estate professionals in your area, many of our programs are available to you at no additional cost. Here’s a selection of our programs: • Royal LePage Welcome Webinars & RLP101 – Join us for one of our Welcome Webinars and get an overview of Royal LePage tools and services. Then, gain more comprehensive understanding of the tools via RLP101; a series of recorded webinars and video tutorials covering everything from our history to using the Marketing Centre. • RLP University – Take professional development courses online, at your own pace. Choose from sales and service skills, Microsoft applications and more. Earn your Accredited GreenAgent™/GreenBroker™ designation at a discounted rate through RLP University. • Designations – Through our partnership with industry providers like the Institute for Luxury Home Marketing and REBAC, we offer industry-recognized designations to our network.
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• Realtor Marketing Workshops – Practical, interactive workshops, offered twice a year, with new curriculum every time. Learn industry best practices for marketing and growing your business, and how to leverage cost effective tools like the Royal LePage Marketing Centre and Social Media.
For more information on the lifelong learning opportunities available to you, please contact Learning Services: learningservices@royallepage.ca
2009 National Association of Realtors Profile of Home Buyers & Sellers Julia Barnard, “The Benefits of Lifelong Learning and Discovery” Ezine @rticles, 2009
I found this workshop to be one of the more relevant that we have taken. Very current, with a greater focus on market segmentation, and maintaining those particular forms of communication. - Carolyn Suski, Royal LePage Action Realty
The subject matter is always very relevant. It is phenomenal to be able to have handson training from a live person! I always learn something new. - Lindsay Percy, Royal LePage First Contact Realty
Very engaging workshop - interactive and informative. I have a 20 + years of marketing experience and I still learned a lot from this workshop. Well done! - Denise Dilbey, Royal LePage Meadowtowne Realty
I just love attending these workshops. It keeps me current... and one step ahead of the competition. Thanks Marketing Centre, your trainers are fantastic. - Jasmin Dennis, Royal Lepage Kingsbury Realty
Fall 2010 | Leading Edge Magazine | 9
Royal LePage Shelter Foundation Putting abuse out of commission “ The Women’s Shelter saved mine and my daughter’s lives. I believe that statement sums up how much the Royal LePage Shelter Foundation means to me. It is the reason I chose Royal LePage as my brokerage over all of the others. The more I learned about what a wonderful charity it is, the more it solidified for me the excellent choice I made. I want to be a part of something that can potentially help others to rise above family violence and triumph in their lives, as I have done.” - Darlis Bachusky, Alberta (Agent of ChangeVolunteer) Thanks to the incredible generosity of Royal LePage real estate professionals, the Shelter Foundation has raised more than $10 million to end family violence. We’ve become Canada’s largest foundation dedicated exclusively to funding women’s shelters and violence prevention programs. In 2009, we broke all previous records raising nearly $1.5 million! The best part is, because Royal LePage Canada underwrites all administrative costs of our charity, 100 per cent of every penny went directly to helping more than 30,000 women and children. “ I’m proud of the work being done by the Royal LePage Shelter Foundation across Canada to assist women and children who are in need of a safe place. I’m grateful for the opportunity to be involved in something that is changing and saving lives right in my own community.“ - Norm Fisher, Saskatchewan (Top 1 per cent donor and Shelter Award Winner) Through donating a portion of commission on the purchase or sale on behalf of clients’ property, our agents are helping create safer homes and
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The Garage Sale for Shelter is a total winwin event: not only did we raise significant funds to help women and children escape abuse, but our office also enjoyed a great team experience and we raised our profile in the neighbourhood. – Leila Brewster, Toronto safer communities. Our brokers, agents and staff are also actively volunteering at their local shelters, collecting in-kind goods, planting Shelter Blooms tulips and holding special community events – all to raise funds and awareness for our cause. Our biggest national initiative is the National Garage Sale for Shelter. At our second annual event on Saturday, May 15, nearly 130 Royal LePage offices raised more than $300,000 generating 19 million media impressions. Thanks to the hard work and enthusiasm of our garage sale committees in every
province, we more than doubled our results from 2009. Together we mounted the biggest fundraiser in the history of the Shelter Foundation and the biggest charity garage sale ever in Canada. The event was generously supported by some extraordinary sponsors -- Atlas Van Lines Canada, TD Canada Trust Mobile Mortgage Specialists and Advance Commission Company of Canada. “Helping You is What We Do” is not just a collection of words sitting beneath our logo. Royal LePage agents, brokers and staff care deeply about giving back to the
community. Thanks to their commitment, families’ lives will be forever changed, kids will be able to sleep through the night and women at the 150 shelters we support will be safe. “ The Foundation is by far our biggest donor. The financial support that we receive from you is invaluable to our ability to continue to provide programming and support to women and their children who are rebuilding their lives in the wake of abuse. Thank you for the work that you do in aid of Margaret Laurence House and in aid of the other shelters who also benefit from your time, energy and passion for supporting women in transition from abuse.” - Margaret Laurence House, Victoria BC Our focus is also on breaking the cycle of violence. We are helping to educate the next generation about safe relationships through the Fourth R Project and funding violence prevention grants with our partners, the Canadian Women’s Foundation. “ Canadian Women’s Foundation is proud to partner with the Royal LePage Shelter Foundation. Together we are supporting shelters for women and children fleeing abuse, programs to help women and their children rebuild their lives after abuse, and education programs to prevent abuse in the first place. And we are doing this in local communities all across Canada. Royal LePage brokers, agents, employees and management, through their support of the Royal LePage Shelter Foundation and our partnership, are outstanding business leaders on this issue in Canada.” - Beverley Wybrow, President & CEO, Canadian Women’s Foundation
Congratulations to our 2009 Shelter Award Winners: Shelter Award recipients are nominated by you for making an outstanding or extraordinary contribution of time and effort to their local shelter and the Royal LePage Shelter Foundation. We are thrilled at the chance to be able to recognize some of our unsung heroes. Philanthropist of the Year: Ruthe Penner Partner of the Year: TD Canada Trust Alberta Individual: Jerry Aulenbach Alberta Office: RLP True North Realty BC Individual: Sebastian Albrecht BC Office: RLP Coronation West East Coast Individual: Carla Bouchard East Coast Office: RLP Atlantic - Halifax Manitoba Individual: Rick Preston Manitoba Office: RLP Prime
Ontario: Individual: Susan Taylor Ontario Team: RLP Lakes of Muskoka-Dwight Ontario Office: RLP Credit Valley Quebec Individual: Caroline Magnan-David Quebec Office: RLP Village Pointe Claire Saskatchewan Individual: Norm Fisher Saskatchewan Team: RLP Phil Robertson Realty Thank you to all of our generous donors! Top 1 per cent 2009 Shelter Foundation Donors: Lauretta Stewart, Doug Hayden, Norm Fisher, Julio Florez, Don Gault, Victoria Schumann, James Wright, Elli Davis, Cliff Stevenson, Brian Elder, Heather Heaps.
What once was a dream of hope and peace is now our reality. This is an accomplishment that I am very proud of and I would not be where I am today without the shelter. For women like me who, for so long lived in isolation, it is deeply moving to see all the people that care. Thank you for being here and to every Royal LePage agent across Canada who donates to the Royal LePage Shelter Foundation and volunteers at their local shelter. Thank you for supporting the programs that saved my life. – Rose, Survivor
Fall 2010 | Leading Edge Magazine | 11
Royal LePage events Top 5 reasons to attend an event Insight Hear from the Royal LePage leadership team and learn about the corporate vision and strategy and how your role relates to specific goals and the company’s overall objective. Connections Connect with Royal LePagers from coast to coast, renewing old acquaintances, making new ones, and building your referral network. Learning Learn about the latest trends from industry experts and choose from a variety of professional development sessions to hone your skills within specialized areas. Recognition Celebrate exceptional performance (possibly even your own!) at awards presentations and parties and meet and learn from those at the top of their game. Fun Your time at events is a great investment in your business but we won’t let you leave without some great memories and a great time! Calendar of Events – 2011 • January 14 Saskatchewan Awards Event Hotel Saskatoon, Regina, SK • January 27 - 29 Banff Western Connection Fairmont Banff Springs Hotel, Banff, AB • February 4 Quebec Awards Event Château Royal, Laval, QC
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• February 11 - 12 East Coast Kickoff & Awards Event Moncton Casino, Moncton, NB • February 24 British Columbia Awards Event Pan Pacific, Vancouver, BC • February 26 Manitoba Awards Event Fort Garry, Winnipeg, MB • March 3 Alberta Rally/Awards Event Marriott River Cree, Edmonton, AB • March 10 Ontario Awards Event Metro Toronto Convention Centre, Toronto, ON • April 27 - May 1 National Chairman’s Club Retreat Laguna Beach, California • May 14 Shelter Foundation National Garage Sale Royal LePage Coast to Coast!
Chairman’s Club Retreat St. Lucia 2010 The 2009 Royal LePage Chairman’s Club members qualified to attend a retreat in St. Lucia in February 2010. Each year, Chairman’s Club members – the top 1 per cent in the Royal LePage network – are invited to a retreat where they celebrate their success, network and give back to a local charity. The charitable component to the St. Lucia retreat included a visit to the Grow Well Centre in Gros Islet, which serves to “encourage, improve and develop the positive and constructive growth of youth within the district of Gros Islet.” The Royal LePage group donated a
variety of gifts including craft materials, computer ink cartridges, children’s books and monetary donations. The local media covered the visit and lauded the group of Royal LePagers for their support. 2010 National Sales Conference September 22 - 25, 2010 Fairmont Queen Elizabeth Montreal, Quebec The Royal LePage National Sales Conference takes place every two years. The event, hosted in 2010 in Montreal, attracts more than 1,200 delegates from across the nation. The quality of our keynote speakers is a big reason this event routinely sells out early. Keynote speakers: Mitch Joel President, Twist Image Digital Marketing and Personal Branding Expert Mitch Joel is President of Twist Image — an award-winning Digital Marketing and Communications agency. In 2008, Joel was named Canada’s Most Influential Male in Social Media, one of the top 100 online marketers in the world, and was awarded the highly-prestigious Canada’s Top 40 Under 40. His newspaper business column, “New Business — Six Pixels of Separation”, runs bi-monthly in both The Montreal Gazette and Vancouver Sun, and his monthly column, “Ultraportable”, is featured in enRoute Magazine. His first book, Six Pixels of Separation, named after his successful Blog and Podcast is a business and marketing best-seller. He is also a passionate entrepreneur and speaker who connects with people worldwide by sharing his marketing insights on digital marketing and personal branding.
Terri L. Sjodin CSP, Founder and Principal, Sjodin Communications Persuasive Presentation Skills Terri Sjodin, is the principal and founder of Sjodin Communications, a Public Speaking, Sales Training and Consulting Firm, based in Newport Beach, CA. She is one of America’s most highly sought after female speakers and has trained and motivated thousands of people from all over the world. Her unique specialization is advancing the persuasive presentation skills of professionals. She is the author of the highly acclaimed book, “NEW SALES SPEAK - The 9 Biggest Sales Presentation Mistakes and How To Avoid Them” published by John Wiley & Sons, New York, She is also co-author of “Mentoring - A Success Guide for Mentors and Protégés”, co-written with Floyd Wickman, and published by McGraw-Hill.
Brian Buffini Lead Generation Expert, Founder and Principal, Buffini & Company Brian Buffini developed a powerful referral system that helped him become one of the top Realtors® in the nation. In 1995, he started Buffini & Company to share these highly acclaimed lead-generation strategies with others. Now the number-one real estate training and coaching company in North America, Buffini & Company equips real estate, lending, and service industry professionals with tools to dramatically increase business while living a balanced life. Today, thousands of real estate, lending, and service professionals across the nation are implementing Brian Buffini’s Referral Systems. Brian has provided expert training to almost a million people through his nationwide Turning Point seminars. Buffini & Company’s three Coaching Solutions are designed to position entrepreneurs for success.
Fall 2010 | Leading Edge Magazine | 13
Leading Real Estate Companies of the World
®
Your U.S. and international broker-to-broker referral network Royal LePage’s affiliation with Leading Real Estate Companies of the World® (Leading RE) is your best resource to tap into lucrative real estate referrals for your clients who are moving to the U.S. and other international locations. The well-established Leading Real Estate Companies of the World® network provides you with knowledgeable, locallyimmersed real estate connections to take your business to new heights. Through the Leading RE network, more than 40,000 families around the world are assisted annually in buying/selling investment or vacation properties. That track record can translate well to your business – serving to raise your profile through the level of service you’re able to provide your clients, and resulting in a positive impact on your business’ bottom line. Whether your client is looking for a U.S. property, or they are targeting overseas, Royal LePage’s affiliation with Leading Real Estate Companies of the World® will connect you with trusted representatives in more than 30 markets around the world. Quality referrals that reflect well on you • Leading Real Estate Companies of the World® is the largest network of top independent local and regional brandname brokerage firms in the residential sector of real estate. • The Leading RE network encompasses 150,000 sales associates worldwide through 5,000 offices representing 600 firms. Only the best companies are approved to join the network and must meet high standards to qualify for membership in this elite group. • Leading Real Estate Companies of the World® is responsible for the sale of nearly 1 million homes annually –
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valued at $250 billion. That’s more than any other real estate network in the world. • This network dominates the list of the top 500 real estate companies in the United States, with 30 per cent of the total sales generated by the
500 highest-producing residential companies in the country. • Leading Real Estate Companies of the World® has top firms in terms of sales or volume in 41 of the top 90 markets. That’s more than any other national real estate organization.
Increase your earning potential and put your U.S.- and internationally-bound clients, family and friends in the good hands of the Leading RE network.
Increase your income potential • Leading Real Estate Companies of the World® affiliates generate 30,000 - 40,000 broker-to-broker referral introductions annually, with a nearly 40 per cent conversion ratio. • With an average home sale price of nearly $300,000, the average referral fee to a Leading Real Estate Companies of the World® agent is about $1,400. This is a great return, with the peace of mind that you will be making an introduction to a real estate professional who will reflect well on you. • Remember, any business that you cannot service yourself is a potential referral, so keep referrals on your radar at all times. Wondering where to start? Increase your earning potential and put your U.S.- and internationally-bound clients, family and friends in the good hands of the Leading RE network. Simply contact Nelia Carreiro, and she takes care of the rest. For more information, or to place your referral today, contact: Nelia Carreiro WRS, RCC Royal LePage Canada Manager, Broker Services Leading R.E. Companies of the World Referral Coordinator Phone: (416) 446-7974 Fax: (416) 510-5856 nelia@royallepage.ca
Increase your earning potential through our referral network “Through the Leading RE network, more than 40,000 families around the world are assisted annually in buying/selling investment or vacation properties.” Fall 2010 | Leading Edge Magazine | 15
The Red Market Royal LePage’s official online store In Buffini & Company’s 100 Days to Greatness™ Program, they speak about the Personal Contact System and the importance of client “pop-by” items in generating referrals. To make the most of the system, it is recommended that you call your clients ahead of time, stay no more than 15 minutes and leave behind a personalized gift. Gifts that are thoughtful, useful and creative will have value in the eyes of the receiver, and help you make the right impression. The Red Market, Royal LePage’s official online store for promotional products and office supplies, has a variety of unique pop-by gift options for under $10. Most of these products can be personalized to make it easy for your clients to recall your contact info and send you a referral. The value of a referral from just a single client – and the residual business it may earn – will likely provide ample return on your investment. More on The Red Market The Red Market offers a wide variety of Royal LePage branded products to help you promote your business and stay top-of-mind with your clients. Whether you are looking for Buffini pop-by gifts, closing gifts, office supplies, event supplies, or prospecting, CRM and recruiting tools, The Red Market has you covered. Also, a portion of all proceeds Promotional items have long been utilized by marketers to raise brand awareness and keep a brand top-of-mind. They also serve to differentiate a business, motivate buyers, and reward employees and loyal customers. Real estate professionals are no strangers to using promotional items. The majority invest at least a portion of their annual marketing budgets to serve this purpose since, over time, promotional items have proven their worth.
18 | Leading Edge Magazine | Fall 2010
… a portion of all proceeds from Red Market sales goes directly to the Royal LePage Shelter Foundation, Canada’s largest public foundation dedicated exclusively to funding women’s shelters and violence prevention and education programs.
from Red Market sales goes directly to the Royal LePage Shelter Foundation, Canada’s largest public foundation dedicated exclusively to funding women’s shelters and violence prevention and education programs. What customers are saying about The Red Market?* • 94 per cent of Red Market customers rate the selection of products on the Red Market as “good,” “very good” or “excellent.” • 92 per cent of Red Market customers rate the quality of products on The Red Market as “good,” “very good” or “excellent.” Top 10 Most Popular Products** • Eco Tote Bags • Vienna Ball Point Pens • Eco Yard Waste Bags • Envelopes • Lapel Pins • Guides to Buying & Selling Your Home • Foldaway Tote Bags • Kit folders • Letterhead • Golf Tee Holders Shop The Red Market today at marketing.rlpnetwork.com/rm
Did you know? • You can add your personal branding. Customize your order by adding your logo or contact information to almost any Red Market item. • Don’t see the product you want? Just ask! We are happy to source any promotional item and provide you with a competitive quote. • Save 25 per cent off UPS retail shipping rates. Now it costs even less to have your Red Market items delivered. All in-stock orders are shipped within 24 to 48 hours. • Get deep discounts through pre-buys. Four times annually, we offer a unique or demand item at a deeply discounted rate. Your collective buying power helps secure the best possible pricing.
*Based on the Red Market Customer Feedback Survey. 285 total respondents. **June 2009 to June 2010.
• Earn a chance to win a $100 Red Market Gift Certificate. After you’ve placed an order on The Red Market, simply complete the customer feedback form for a chance to win. Fall 2010 | Leading Edge Magazine | 19
“A” for Attitude How your attitude affects your business by Brian Buffini Buffini & Company, Chairman and Founder
Whether dealing with a difficult client, helping someone who is losing his or her home, or simply being exposed to the negativity swirling about in the media, this business can drain you from time to time. While some of these things are out of our control, how we react to them is most certainly not. I believe that to fuel and maintain a positive outlook there are three things we must examine: Philosophy. Attitude. Energy. 1. PHILOSOPHY Literally, the “love of wisdom” philosophy is what you believe about yourself and the world around you. What do you believe about yourself? How do you feel about yourself? How do you feel about your business? Do you think you’re a winner or are you tougher on yourself than you should be? If you’ve experienced a shift in income, has that impacted how you feel about your abilities? Are you “only good because the market is hot,” or do you believe you are a professional who brings value to their clients? What we believe about who we are is critical to our daily attitude. As my mentor, Zig Ziglar says: “You were born to win, but to be a winner you must plan to win, prepare to win and expect to win.”
20 | Leading Edge Magazine | Fall 2010
Positive thinking will help you be a better business owner, wife, brother, daughter, friend – especially when you put what you learn into practice – go do it, share it and be it. What do you believe about the industry? What do you believe about your industry? What do you believe about Royal LePage – about the support and skills you have at your disposal? Do you believe it’s a good time to buy? Are you getting that across to your clients? Examine what you feel about your industry and make sure you are as positive as you’re trying to get your clients to be!
Mental Diet Reading is key because it demands a level of commitment and concentration. If you’re not reading, you might as well be illiterate so take time to read and put the good stuff into your head. We maintain a booklist on our website of great titles to immerse yourself in. This stuff works so what are you waiting for? Turn off the TV; turn on the reading lamp! Exercise
What do you believe about the future? Listening to bad news about the economy can impact your optimism and leave you cynical and worried about the future – almost without you knowing it. What do you believe about the future? Are our best days behind us or do you see opportunity ahead? Author Norman Vincent Peale tells us: “Any fact facing us is not as important as our attitude towards it, for that determines our success or failure.” The way you think about something can defeat you before you begin so learn to be aware of this and stay positive about where we’re headed. Canada is a great country with an abundance of ambition and drive. Keep that in mind instead of the pundits’ predictions! 2. ATTITUDE The key to a positive attitude is a good mental diet and then exercising what you learn.
Zig Ziglar tells us that “Positive thinking will let you do everything better than negative thinking will.” If I’m thinking positively while engaging in an activity I’m going to do it better than if I’m thinking negatively about it. Positive thinking will help you be a better business owner, wife, brother, daughter, friend – especially when you put what you learn into practice – go do it, share it and be it. Gratitude I believe gratitude is missing from our society today. More and more we seem to be developing a sense of entitlement. This is very apparent at restaurants where instead of thanking their servers, diners barely even acknowledge them. Well if you Work by Referral you know that it’s all about gratitude and being thankful. During one of the worst recessions the U.S. has ever seen, our American Members still managed to make, on average, $168,000 last year. They did it by providing great service with an attitude of gratitude. This is
a non-negotiable. Royal LePage provides you with everything you need to succeed. It’s time to be thankful! 3. ENERGY This industry never sleeps but if you are never really off can you ever be fully on and engaged? Without a scheduled break it’s impossible to maintain a high level of execution but when we know there’s a rest on the horizon we can work that much harder in the short-term. There’s a powerful yet simple formula for energy I learned from my good friend Tony Schwartz: Run Hard. Rest and Recover. Run Hard Again. Based on studies of top athletes and achievers, the idea is that for high performance you go hard, then stop and recover. Buffini & Company has designed three annual Blitz programs for our Members so they can utilize this natural flow: work hard with specific activities, rest and recover, then work hard again to get the great results in their business. But remember, the recovery is just as important to get off the treadmill and refuel. I believe that attitude is not an accident; it’s a choice. I believe we can cultivate an awesome attitude and wear it every day by making sure we align our philosophy, direct our attitude and replenish our energy. Clients are looking to you for reassurance. With all the tools and resources Royal LePage provides, you have everything you need to maintain a winning attitude and succeed!
Brian Buffini is the Chairman/Founder of Buffini & Company. Headquartered in San Diego, Buffini & Company is the largest real estate training and coaching company in North America.
Fall 2010 | Leading Edge Magazine | 21
Royal LePage public relations Keeping a finger on the pulse of the Canadian real estate market Trusted real estate insight Time and time again we’ve heard: “Is this a good time to sell? or “Is this a good time to buy?” With a question of this magnitude touching so many Canadian consumers, it demands informed consideration and guidance. At Royal LePage, the role of public relations is to facilitate the information share between our brokers and agents with potential clients and consumers. So whether you are a first-time homebuyer, selling a condo in downtown Vancouver or purchasing a cottage for the family in the Kawarthas, Royal LePage develops the resources to help educate and advise on whatever the purchase may be. So how does public relations facilitate this information flow? Drawing from a specialized pool of regional brokers and agents, Royal LePage public relations produces meaningful and timely reports, releases and advisor surveys, which provide a platform for our real estate experts to showcase their extensive knowledge. Whether it’s reaching existing clients, potential clients or your neighbour next door, public relations aims to continuously reach new audiences through radio, newspaper, television and online sources to ensure the Royal LePage brand remains the trusted source for real estate expertise. Royal LePage: The go-to resource for the Canadian perspective with a uniquely preserved Canadian perspective; government agencies, tourism boards and financial institutions have also continuously looked to Royal LePage as the trusted voice of Canadian real estate. Appearing in various trade publications, referenced in relocation transactions and sourced in economic summit presentations, Royal LePage has positioned itself as a key player in all things real estate.
22 | Leading Edge Magazine | Fall 2010
Our oldest report – The Royal LePage House Price Survey has built a legacy for itself reaching as far back as 1974, providing information for more than 250 neighbourhoods from coast to coast. Released each quarter, the House Price Survey connects Canadian brokers and agents with information pertinent to the purchase, sale or rental of a property. The success of the House Price Survey report continues as we expand the regions it encompasses – an ever evolving report – it’s now become a Canadian staple in the real estate industry. Public Relations Geared For You All of our releases and reports are housed online for you to access and information ranges from the First Time Homebuyer to Advisor survey reports on timely real estate topics. When news sources depend on accurate real estate
information, they turn to Royal LePage to provide knowledgeable and trustworthy industry advice that consumers want to learn more about. With established media relationships across Canada, the public relations team works to generate visibility, build credibility, influence mind-share and reinforce the brand; and we can do all these things simultaneously while supporting you increasing sales! With such a vast media landscape in Canada and beyond, the public relations team at Royal LePage is dedicated to ensuring we remain a big part of the real estate conversation.
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Going Mobile Mobile fast becoming the electronic device of choice Three significant trends relevant to real estate 1. Mobile and Social Mobile devices and social networking go hand-in-hand. With the recent “app” boom, smart phones have become pocket-sized communications and multi-media creation tools. The ability to instantly create and share rich content, or leverage existing content, across social networks makes for an exciting synergy that has far-reaching implications for real estate professionals. 2. GEO Location
Mobile technology continues to be one of the biggest stories on the Canadian marketing scene. Data plans are becoming more affordable as the “big three” service providers are slowly losing oligarchy-like status and are forced to be more competitive. Phones are becoming smarter and increasingly more affordable. The software development community is experiencing an “app boom,” where
a myriad of affordable applications is available that enable smart phones to do just about anything. Riding on this surge of innovation, smart phone adoption is predicted to reach 37 per cent of all global handset sales by 2012*. In addition, according to a recent report released by Morgan Stanley, over the next five years, more users will connect to the Internet using mobile devices than PCs**.
Many handsets and most smart phones are GPS enabled, allowing your phone to know where you are in the world. Mobilefriendly listings are already in market. GPS can take things to a new level for real estate professionals and home buyers alike. As a result, we are on the vanguard of change with a host of emerging mobile tools. One such example is “Geo-fencing” – a tactic where the user defines a geographic region in which they wish to track information, using “located nearby,” to find listings or open houses. An app downloaded to their device notifies the user when they are near these points of
*Source: Gartner.com ** Source: Gigaom.com
Canada’s Wireless Industry: • Canada’s wireless carriers now offer coverage to more than 99 per cent of Canadians. • Advanced wireless networks that support handsets such as smart phones and Internet sticks are available to 96% of Canadians. • Canada’s wireless carriers invest more than $1 billion in mobile phone communications infrastructure each year. 24 | Leading Edge Magazine | Fall 2010
interest. We have merely scratched the tip of the iceberg as more and more ways to leverage map-based listings information becomes available for mobile users. 3. Augmented Reality Augmented Reality is a catch-all term that refers to the ability to augment a physical or “real world” environment with virtual or computer generated information or imagery. Many technologists are predicting an “Augmented Reality bandwagon” in the very near future that will raise significant implications for location based real estate applications. One concept dubbed “indoor smartness” operates by tagging elements in a room or home with detailed information or rich media. Imagine a feature sheet coming alive for a visitor walking through an open house by being able to see tagged items in the home and get deeper and richer information on the spot! What’s on the mobile horizon at Royal LePage? At Royal LePage, we are watching these trends with great interest and evolving our mobile technology strategically, as smart phone adoption ramps up. We are constantly evaluating ways to position our network as leaders and innovators in the
… smart phone adoption is predicted to reach 37% of all global handset sales by 2012*. industry and see many opportunities in the emerging mobile arena.
make strategic decisions around how to support our network moving forward.
Currently, we are developing a multiple device and platform-friendly app in time for introduction at our National Sales Conference being held in Montreal this September. We are treating this app as a low cost pilot, designed to give more empirical information about our network’s user metrics and enable us to
The app will also tap into some aspects of the trends mentioned earlier and include: location mapping, eCard networking and referral tools, speaker profiles and notes, future conference registrations, and a mobile application survey.
• At the end of June 2010, Canadian wireless phone subscribers numbered 23.4 million. • Half of all phone connections in Canada are now wireless. • 75% of Canadian households have access to a wireless phone. • Canadians send 135 million text messages per day. (Source: Canadian Wireless Telecommunications Association, September 2010)
Fall 2010 | Leading Edge Magazine | 25
GetHomes.ca lead generation Online lead generation is a tool for your success The vast majority of home buyers turn to the Internet as their primary source of real estate information, even before they look for an agent. That’s why it’s important to have a system in place to serve up these leads in a timely and targeted manner. These digitally-immersed prospects are looking to have their requested information delivered to them through online or email formats – quickly, and to be responded to by qualified experts in real estate. GetHomes.ca online lead generation is exclusive to Royal LePage agents and is your best resource to successfully convert Internet-savvy home buyers/sellers into clients. How GetHomes.ca works • When sufficient lead volume is available in your area of choice, we add agents to the program. We also maintain a waiting list of those interested in the program in areas currently at capacity. • Leads are generated through SEO, SEM and affiliate marketing in more than 50 cities across Canada.
information; set them up on auto listings. Provide relevant and useful information.
dilemma when working with the online lead. As a sales representative you need to determine:
2. Respect privacy. Online consumers expect anonymity until they are ready to reveal themselves.
° Which leads have an immediate time frame?
3. Respect the online boundaries. Don’t push the online consumer to phone or meet you until they are ready. 4. Build relationships with the online consumer by providing them with information and advice in a way that lets them know that you are an expert. 5. Be flexible and tailor your approach to meet the prospect’s needs. Assure them that you are here to provide guidance and assistance. Many people use the internet as a shield from pushy sales people. Let them know you are here to share your expertise. Key facts about online lead generation:
• We guarantee 120 leads over six months.
• 67 per cent* of leads selected their sales representative because he/she was the first to respond to their inquiry or the most responsive.
• GetHomes.ca helps you convert leads to sales with an easy-to-use, webbased lead management system and interactive monthly coaching calls led by our sales team.
• 86 per cent* said sales representative response time was either “extremely important” or “very important” when they decided whom to use as their sales representative.
• GetHomes.ca has an average expected close rate of more than 4 per cent, with top performers achieving up to 15 per cent. Industry standard is between 1-2 per cent.
• 67 per cent* expected their sales representative to respond within four hours. When asked why they were satisfied with their sales representative, 91% of online leads cited “always quick to respond.”
Five keys for success in developing leads: 1. Start by building trust. Deliver what the consumer wants: listing *Internet Buyer Statistics (California Association of REALTORS®)
26 | Leading Edge Magazine | Fall 2010
• Consumers want to find the right home, at the right price, at the right time. The timing element is an interesting
° Which leads have a more distant time frame? ° Which leads have no time frame? A recent industry study indicates buyers will start researching the market and the buying process 16 months before they actually purchase. In order to determine which leads are at which stage in the timing process you will have to remain systematic in your contact, follow up and management of all your online leads. It is helpful to remember that we are always working today for tomorrow’s business. As a Royal LePage agent, you have exclusive access to the GetHomes.ca lead generation program that will generate leads. For more information, email info@gethomes.ca, or call 416-442-5381. Additional lead generation resources: Aeromove’s Lead Generation and Client Rewards programs are other lead generation and marketing tools that you can use to generate new business and reward prospective and existing clients with a strong recognized loyalty currency. For more information, please contact 1-866-797-2767. Another tool for agents to use in marketing and nurturing leads is the Real Estate Financial commission advance service, where you can use your advances for purchasing a lead management system or marketing materials to support your online leads. For more information, please contact 1-888-557-7477.
Preferred partners and suppliers
Royal LePage has partnered with brand leaders in their respective industries to offer you exceptional products and services to support your business. Each preferred partner and supplier offers value that is unique and/or exclusive to Royal LePage in the form of reduced pricing and/or value-added benefits*. • Imaging Products & Office Equipment
• Moving & Transportation Services
• Personalized Magazine Subscriptions
• Financing Expertise & Advice
• Personalized Calendars
• Hosted and Managed Email Application Services
• Unaddressed Admail Services
• Tradeshow Booths
• Credit Reports
And more… For individual offer details, visit marketing.rlpnetwork.com/suppliers *Note: Partners, Suppliers and their offers for Royal LePage are subject to change.
Fall 2010 | Leading Edge Magazine | 27
2010 Recreational Property Report Canadians Pursuing Recreational Property for Lifestyle towards recreational property ownership conducted by Angus Reid and commissioned by Royal LePage Real Estate Services. When buyers were asked why they plan to purchase recreational property, lifestyle was the number one reason given, at 47 per cent. Only one in four buyers say new Canada Mortgage and Housing Corporation regulations reduce their desire or ability to purchase a recreational property. The changes will require Canadians to pay a minimum 20 per cent down payment on any residential or recreational property they purchase that is not their primary home.
Canadians Pursuing Recreational Property for Lifestyle, despite Tax Concerns and Stricter Mortgage Rules
Comparatively, Canadians are more concerned about increases in taxation affecting their ability to buy vacation properties, with 49 per cent responding that they are concerned about new taxation rules such as the HST on new-construction homes while 46 per cent express concern about increasing property taxes. Just over onequarter of those surveyed (26 per cent) want to purchase a recreational property before interest rates start to rise, while 10 per cent said a hike in interest rates would stop them from purchasing.
Almost half of Canadians considering buying a recreational property will do so to improve their lifestyle, despite concerns about increasing taxes, rising interest rates and new regulations that require higher down payments on second homes, according to a nationwide survey of Canadian attitudes
National opinion poll shows condominiums increasingly popular choice for a second home
2010 Recreational Property Price Summary (Average Price Range by Province**) Standard Waterfront, Land Access Cottage (1,000 sq feet, 3 bedrooms, 100 foot lot) PROVINCE
AVERAGE PRICE RANGE 2010
PROVINCE
AVERAGE PRICE RANGE 2010
Prince Edward Island
$180,000 – $200,000
Ontario
$140,000 – $1,050,000
Nova Scotia
$190,000
Manitoba
$189,000 – $360,000
Newfoundland
$110,000
Saskatchewan
$245,600 – $600,000
New Brunswick
$65,000 – $1,000,000
Alberta
$300,000 – $555,000
Quebec
$326,000 – $650,000
British Columbia
$345,000 – $1,500,000
NATIONAL AVERAGE
28 | Leading Edge Magazine | Fall 2010
$65,000 – $1,500,000
Canadians are more concerned about increases in taxation affecting their ability to buy vacation properties. “Canadians are generally confident about buying recreational properties because they see a pay off in terms of improved quality of life,” said Phil Soper, president and chief executive, Royal LePage Real Estate Services. “The survey results show that tightening of lending requirements for second homes, coupled with an increase in taxes and expectations of higher interest rates, may have a dampening effect on the recreational property market. However, there continues to be strong demand for second homes, and Canadians appear prepared to make significant investments in order to enjoy their leisure time.” Forty-three per cent of respondents said they would buy a vacation property because it is a good investment – down from 64 per cent in a comparable Royal LePage survey conducted in 2009.
“Fewer people are looking to acquire recreational property for its investment value this year, a direct result of rising cottage prices. The brave bargain hunters that purchased during the depths of the 2008-2009 recession have been rewarded by appreciating prices this year,” Soper said. One-third of respondents in the 2010 survey said they will not have to make any financial or lifestyle changes in order to afford a recreational property, while 25 per cent of respondents said they plan to rent out their recreational property for part of the year (up from 13 per cent in 2009). Only 15 per cent plan to purchase a vacation home with friends or family. The survey was commissioned as part of the 2010 Royal LePage Recreational Property Report, an annual market analysis
of recreational property prices, trends and activity in selected leisure markets across the country released last month. The chart below shows the typical price range for standard waterfront, land-access properties across Canada. Properties in BC, Ontario and New Brunswick saw typical 3 bedroom, 100 foot lot properties sell above $1 million. New Brunswick also offered the most affordable properties, with some averaging as low as $65,000. According to the national poll, waterfront properties continue to be the most desirable recreational real estate for potential buyers, with 34 per cent ranking a “cottage by a lake” as their number one choice, down sharply from 68 per cent in 2009. Meanwhile, condominiums are the preferred property type for 24 per cent of buyers, up from just six per cent of buyers in 2009. “Once again, lifestyle appears to be the driving factor behind recreational property trends, as more and more buyers are telling us they prefer the relatively hassle-free ownership of a second-home
Q: If you were to purchase a recreational property, which of the following are you most likely to purchase? Nat.
BC
AB
MB/SK
ON
PQ
ATL
Cottage on a lake
34%
25%
14%
18%
45%
39%
48%
Condo at a resort
24%
27%
29%
24%
24%
16%
8%
Property in the woods
5%
4%
6%
3%
5%
8%
6%
Timeshare
10%
11%
14%
15%
9%
4%
8%
Mobile home / RV
13%
15%
18%
26%
8%
15%
21%
Farm
1%
0%
1%
2%
0%
1%
0%
Vacant land
2%
2%
4%
3%
2%
2%
4%
Fractional ownership
3%
3%
5%
0%
2%
5%
2%
Chalet near ski hill
3%
7%
0%
2%
1%
4%
0%
Other
5%
7%
10%
8%
3%
5%
2%
Fall 2010 | Leading Edge Magazine | 29
2010 Recreational Property Report (...continued from page 29) Quebec Forty-five per cent of potential buyers in Quebec said that they would not have to make financial and/or lifestyle choices in order to afford a recreational property. This is the highest of any region and 12 per cent higher than the national average. The most important features for buyers in the region include waterfront/beach access (60 per cent), followed closely by peace and quiet (59 per cent), four-season use (43 per cent) and proximity to amenities (30 per cent) Quebec, following only Atlantic Canadians, do not feel the expectation of rising interest rates to affect their desire to purchase a recreational property (69 per cent). Ontario
condominium, where you can spend your weekend on the water instead of whacking weeds,” said Soper. For almost half of survey respondents, buying a recreational property this year will have little or no impact on their ability to vacation elsewhere. Forty-four per cent said buying a recreational property will make no difference to their vacation plans, while 31 per cent of respondents said recreational property ownership will make them more likely to vacation elsewhere. “This may indicate that buyers intend to use rental income from their vacation homes to finance travel abroad, or it could reflect the growing popularity of international house swapping or exchanges,” said Soper. In the survey, buyers ranked the most important features they look for in a recreational property. Fifty-five per cent
30 | Leading Edge Magazine | Fall 2010
said waterfront or beach access, while 46 per cent answered four-season use, and 43 per cent said their vacation home must be in a quiet location. Atlantic Canada
The three most important features to potential buyers in Ontario are waterfront/ beach access (61 per cent), four-season use (47 per cent) and peace and quiet (40 per cent). Tied with Alberta and British Columbia, Ontario’s potential buyers are considering buying a recreational property to enhance their lifestyle (49 per cent), more so than any other reason.
Atlantic Canadians prefer cottages or “cabins” more than any other region in Canada (56 per cent compared to the national average of 34 per cent). Atlantic Canadians are also most likely to desire a cottage on a lake (48 per cent compared to the national average of 34 per cent).
Sixty-two per cent of potential buyers in Ontario are likely to be concerned about tax grabs by the government such as HST. This is compared to 53 per cent of potential buyers in BC, where HST is also taking effect.
At 63 per cent, peace and quiet ranked as the most important feature to potential buyers in the region. This was the highest among Canadians and exceeds the national average by 20 percent. This was tied with waterfront or beach access (63 per cent) and four-season use (29 per cent).
Second only to Atlantic Canadians, 45 per cent of Ontarians are most likely to purchase a cottage on a lake. This is higher than the national average of 34 per cent and much higher than potential buyers in Alberta, of which only 14 per cent are most likely to purchase on a lake.
The Prairies In the Prairies, mobile homes are more popular than in other regions in Canada (26 per cent). Greatly exceeding the national average, which saw 13 per cent of Canadians indicating they were most likely to purchase a mobile home or RV. The three most important features to potential buyers in the Prairies are proximity to amenities (48 per cent), followed closely by four-season use (47 per cent) and waterfront/beach access (41 per cent). Peace and quiet as well as utilities are also important to buyers in the region at 39 and 35 per cent respectively.
Not surprisingly, 12 per cent buyers in the region listed eco-friendly as one of the most important features in a recreational property – the highest in the country. The national average for eco-friendly buyers is 9 per cent. Forty-nine per cent of potential buyers in BC consider lifestyle to be the reason to purchase a recreational property. This is compared to 44 per cent who consider recreational property ownership as a good investment. The national average considering lifestyle as a reason to buy is 47 per cent, while 43 per cent of potential buyers in Canada see ownership as good investment.
Methodology From May 20 to May 26, 2010, Angus Reid Public Opinion conducted an online survey among 1,003 randomly selected Canadian adults who are considering purchasing a recreational property in the next 24 months. The margin of error— which measures sampling variability—is +/- 3.1 per cent. The results have been statistically weighted according to the most current education, age, gender and region Census data to ensure a sample representative of the entire adult population of Canada.
Alberta Potential buyers in Alberta are considering purchasing a condo as a recreational property more than any other regions in the next 24 months (29 per cent). More than any other regions, potential buyers in Alberta consider a recreational property’s long term investment potential as a primary reason to buy (49 per cent). This is compared to the national average of 43 per cent. Interestingly, Albertans are just as likely (49 per cent) to consider lifestyle as a reason to buy. The three most important features to potential buyers in the region are fourseason use (51 per cent), proximity to amenities (48 per cent) and waterfront/beach access (42 per cent). This was followed closely by peace and quiet at 41 per cent. British Columbia The three most important features to potential buyers in BC are waterfront/beach access (53 per cent), four-season use (44 per cent) and tied for third are peace and quiet as well as proximity to amenities (40 per cent). *Standard cottage or recreational property - three bedrooms, 1,000 square feet on a 100 foot lot. ** Royal LePage, averages are based on the examination of select recreational areas in each province. ***Utilities include electricity, sewage and plumbing.
Fall 2010 | Leading Edge Magazine | 31
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