Words of wisdom from a bold entrepreneur pitching to the financial dragons on a recent episode of Dragon’s Den. He said private sellers (of real estate) are “naked in the market”. Well yes they are – but from a whole different perspective.
His vision of being “naked in the market” is apparently a good thing – stripping away your professionals thus stripping away your cost of sales (commissions). All good apparently. Now the other side of the picture and shocking results after a little professional due diligence.
First the other side of the picture. By “stripping away” professional services which are anchored by an understanding of the business of real estate and include but are not limited to:
- Federal, provincial, municipal, and community compliance issues
- Contract law and contractually binding agreements of purchase and sale
- The past, present, and future of the housing market and ability to interpret statistics
- Skills (the art and science) of valuing a property, negotiating a sale, and closing the deal
- Deploying the right marketing, promotion, and advertising tools for the situation
now the Seller is truly naked in the market! There you stand, alone, without the knowledge of the business, time, or skills to properly conduct this business or manage the ever present emotions. In short, no one has your back.
This entrepreneur is the same as other For Sale by Owner or private sale offerings – it’s simply an internet based advertising opportunity. Since advertising is only a small part of the marketing component, and internet advertising a sub-set of advertising, the balance of ALL the other work and knowledge falls to the Seller. Good luck.
Now the shocking truth. It was interesting to me to note that this entrepreneur states he has “no sales” to date, and yet he also states he has over 5,000 listings on his website. Excuse me? Whose listings is he showing? So I looked up a couple of the listings. One of the feature listings apparently belongs to someone by the name of “Nick Nicks”…OK…so I didn’t bother drilling into that one for obvious reasons. Now remember what I said about my having your back?
The next listing is for 3345 Silverado Crescent, Unit 42 in Mississauga apparently owned by Johnny Zhou. Big surprise – not true! According to the Land Registry Data Base Mr. Zhou did own this property but sold it on January 19, 2010. This activity was crossed referenced to the same information in the Toronto MLS system.
I note that 411.ca still lists Mr. Zhou at that address, with that phone number. However, I also know the 411.ca registry can be very outdated. I wonder what happens if you telephone or email Mr. Zhou as encouraged in this advertisement? Is Mr. Zhou a part of this or has his information been borrowed?
So I called the number, and Mr. Zhou did answer and when asked if he was selling his house on Silverado he said he sold it…a couple of years ago. There you have it folks, at least one of the 5,000 listings on this site are not real!
There is a link to the Dragon’s Den segment below – it’s really an entertaining couple of minutes. But make no mistake – it’s unlikely this deal will close for this entrepreneur. This venture capital team is seasoned and smart, and I’m not the only one who does due diligence. We’d love to hear your thoughts on this subject area. Like…
- Would you buy his product, or this type of product, and why?
- If you want to try selling your home this way, how do you think you benefit?
- Based on this private sale website of “over 5,000 listings”, yet no sales of their product to get those listings, and one verified bogus listing…are similar For Sale By Owner websites suspect?
And if you want a real professional who DOES have your back, I’m only a phone call away – Heather MacDonald 905-822-5000