Bye Bye Bidding Wars

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Yes, here’s my view this morning while I caught up on what’s happening while reading in bed with croissants and a pot of tea. Once again, on Thursday The Globe and Mail touted what Urbaneer has been living every day in the real estate trenches for the recent past.

What was that? Yes, the bidding wars are pretty much over in the condominium market and are diminishing for freehold houses.

Click HERE for the Globe and Mail, HERE for one from the Financial Post (dated October 4th) citing Vancouver and Toronto’s ‘Housing Bubble’, and click HERE to link to some of Urbaneer’s own recent tales and predictions.

From our point of view operating across the original City of Toronto, there still remains a pent-up demand for quality houses in premium locations. This week one of our well-priced listings in coveted North Toronto at Yonge and Lawrence had fifty showings over six days (including Holiday Thanksgiving Monday) before a realtor called saying he was preparing a bid for submission two days before the offer date posted on MLS. This is otherwise known as a ‘bully offer’.

After receiving this call, we took the initiative to forewarn all the other realtors who had showed the property of a possible offer. It prompted others to act. At 10pm that evening the first offer was registered by another realtor. Within thirty minutes two more had come in. And at 11pm the realtor who had originally called submitted a bid. The house sold at 11:59pm for around 15 percent over list, attaining a value that exceeded our seller’s expectations.

Want to learn more about Bully Offers? Click HERE to read our past HomeWatch Newsletter called ‘Bully Offers & Bidding Wars – Strategies for Buying and Selling.’

According to the Urbaneer team, it’s going to be a wonky market for the next little while. Some properties will pop quickly while others will languish for sale. Each without rhyme or reason. For example, we recently sold our stunning executive listing offered at $1,339,000 near hip College Street after only 72 hours on the market for a precedent-setting sum on the street. A week later a substantially renovated house of equal size came to market one block over for almost a quarter of a million dollars less. My only criticism? The property felt a bit like the materials and fixtures sourced from a big box store had inadvertently exploded inside. They were “nice” but common, abundant yet bland, and their installation overpowered the original patina of this once gracious Edwardian manse. Still, I considered it a fixable $50,000 in cosmetics (tile, fixtures, hardware, paint) for a Buyer willing to undo the work. Most Buyers are loathe to rip out recent renovations, but an astute buyer could have latched onto this opportunity and potentially negotiated their entire renovation cost off the list price and subsequently renovated to their liking. After 10 days the Sellers took the house off the market. However, in our opinion this is the kind of opportunity that awaits the prudent buyer as our market transitions out of Scorching Hot into balanced.

Get ready for a lot of contradictions in the media as well as at Urbaneer. It goes with the territory in these times. In a market that will be oscillating on a property by property basis now, more than ever, is the time to ensure you and your realtor have a comprehensive understanding on the dynamics of Toronto real estate.

Not working with a realtor? Please know we’re here to help at 416-322-8000.

~ Steven

Real Estate
Tales From The Real Estate Trenches
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