Toronto’s real estate market has remained twitchy through October as buyers seem willing to wrestle for some properties but not others.
A semi-detached house in High Park north of Bloor sold recently for $129,100 above the asking price of $799,900.
“I think that’s a boat full of money for a semi,” says real estate agent Pro Sarbadhikari of Sutton Group Realty Systems Inc., who sold the house at 165 Pacific Ave. for $929,000. Still, Mr. Sarbadhikari had expected the property to attract more than the two bids it received.
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The semi-detached house is within walking distance of the Bloor subway line. It’s renovated but the bathroom needs updating and the furnace is quite old, he says. It also has the added benefit of parking – but the private drive allows right-of-way for two other houses.
“Some people liked it; some people couldn’t understand it,” he says of the arrangement.
Mr. Sarbadhikari says the parking situation may have held back the bidding a bit. He says a couple of nearby properties had offer dates around the same time so buyers weren’t as pressed to compete. “There’s more material out there.”
The shifting dynamic means some move-up buyers are considering taking the bold move of selling their existing house – even before they’ve got the new one lined up. Conventional wisdom throughout the sellers’ market of recent years has been that move-up buyers should have a place to move to or risk being caught with no place to go. This trap has been part of the reason the inventory of listings has remained tight for years.
Mr. Sarbadhikari received a call last week from the owner of a semi who is planning to list a High Park property soon. When some semis are selling above $900,000, making the leap to a detached house for $1.2-million or $1.3-million doesn’t seem unreasonable, he says.
“Psychologically we’ve hit some great barriers,” he says of the numbers. And that encourages more listings. “If the momentum’s still out there in the market, people put them out there.”
Data from the Toronto Real Estate Board shows that real estate sales in the Greater Toronto Area jumped 12.2 per cent in the first half of October compared with the same period in 2013. During the same period, new listings increased 5.9 per cent compared with the same two weeks last year.
Mr. Sarbadhikari thinks that listings will start to dwindle again when winter sets in. “Sell now, buy later is going to be fairly short-lived.”
And he observes that some houses are not receiving bids by the deadline set for submitting offers. Mr. Sarbadhikari points to two properties which sold recently on nearby Willard Avenue in Bloor West Village. One was so close to the subway that residents could feel the rumble. The owners of that one didn’t get the price they wanted on offer night so they relisted the house at a higher price – $1,029,000. They ended up selling for $940,000, near the original asking price, he says.
The other house, listed at $1.1-million, sold for $1,210,000 on the offer night.
Real estate agent Ira Jelinek of Harvey Kalles Real Estate Ltd. says he’s heard from other agents that the market is sluggish but he hasn’t experienced the slowdown. “I’ve been really busy – doing showings and getting listings. I think it’s hit and miss.”
Mr. Jelinek has a client who saw a beautiful corner condo unit on Elizabeth Street near Bay and Dundas. The client wanted to put in an offer above the asking price of $299,000. Comparable units in the building had sold in the $370,000 range. Mr. Jelinek called the listing agent on the offer day and found out that seven offers were already on the table. “We’re not even bothering,” he says.
Mr. Jelinek got a taste of what many house hunters are feeling when he recently went to purchase a home for himself. He lost out on a house by $5,000 when he bid on a property on Oriole Parkway, north of Eglinton. The asking price was $970,000 so Mr. Jelinek offered $965,000. Another bidder stepped up with the full asking price.
The house previously had been listed for $929,000 and offers were held back, the agent says. The house sold on offer night but the buyer didn’t show up the next day with the deposit cheque and the deal fell apart.
That’s a very rare occurrence, says Mr. Jelinek, adding the buyer must have had second thoughts.
When he wasn’t successful in purchasing that house, Mr. Jelinek was able to strike a deal on a 1970s-era townhouse in Yorkville.
The house was originally listed with an asking price of $1.55-million but it didn’t sell on offer night. The price was reduced to $1.38-million and Mr. Jelinek got it for $1.245-million. He plans to renovate the three-bedroom house inside and out. “In the seventies, they did box and cool. It looks cool today. We’re going to modernize the outside to make it look like it’s brand new.”
He now has a better understanding of what his clients suffer when they have to choose a neighbourhood, then decide how much to spend and how much to invest in renovating.
“I help my clients do that all the time,” he says with a laugh but he found it more challenging to narrow down all of the options for himself. But negotiating instead of competing is a great feeling, he says. “I think that’s healthy and I think that’s normal.”