This autumn’s real-estate market in Toronto seems to be shifting gears each week, says an agent who specializes in the upper echelons of Beaches properties.
Even in that sought-after neighbourhood, the fall market has been a little “iffy” in October, says Thomas Neal of Royal LePage Estate Realty.
“Buyers are more cautious, for sure. They want to see the value.”
Mr. Neal says the fall market has not been as crazily busy as the spring for a few years now, and the stop-and-start activity seems even more noticeable in 2013.
Inventory is higher than usual in the Beaches – especially just above the $1-million mark, he says. It’s not a given that homeowners who sell are going to have buyers competing for their property the way it would have been in the past.
“Agents who price properties low to get multiple offers have to be very careful,” says Mr. Neal.
A couple of years ago, five parties might show up to a bidding contest.
“Two of those five people who put in offers two years ago have bought, one has been priced out of the market, one will be sticking a toe in, and one will be a good offer.”
Mr. Neal says the danger for sellers is that the one decent offer may come in higher than the asking price, but if that price was set artificially low, the seller may not be getting what they think the market value should be.
Buyers are out there mulling about, but they are taking their time now, he says. Many are doing their own searches on the multiple listing service and taking their time before going to view a property. If an offer date is set, many will wait to see if the property sells. If it doesn’t, they’ll have a look around after the date has passed.
“I think a more traditional market is starting to appear,” says Mr. Neal.
He also thinks that some buyers are making a mistake by opting for a brand new or spiffily-renovated house in a poor location over a more dowdy house on a good street. They take out a big mortgage because money is cheap, but they’re drawn, monster homes that may be hard to sell in the future – especially once those finishes start to look dated.
Buying one of the smaller houses on a prime street and gradually fixing it up over time is a more time-honoured way to protect an investment in real estate, he points out.
Mr. Neal advises buyers to think ahead to a time when interest rates go up. That day may be years away – no one knows when it will happen he stresses – but if anyone needs to sell, they won’t want to end up with the most expensive house on a mediocre street.
“People have tended to forget about how important location is.”
As for sellers, Mr. Neal advises them to be realistic and not expect to receive the same abundance of offers that their neighbour boasted about in one of the frenzied spring markets of years past.
“If you get one offer, work with the one offer.”