North York, ON house that recently sold for more than $400,000 over asking. The property is photographed Mar. 5, 2012. (Moe Doiron/The Globe and Mail)Moe Doiron/The Globe and Mail
As hard as it's becoming to shock jaded Torontonians with bidding war antics, one young woman managed it last week when she beat out 17 rivals for a house in Willowdale.
The asking price was $759,000; her triumphant bid was $1,180,800.
Her prize? A pleasant three-bedroom bungalow that hasn't had a whole lot of updating since it was built in the 1960s or so.
An offer $421,800 above the asking price is a lot to absorb and a reader e-mailed to say that folks in the neighbourhood were all talking about it.
Michael Adelson and Sam Samivand of ReMax Realtron, who represented the seller, expected more than asking, but not 56 per cent more.
"We thought the market would take it to its logical level – and the market took it to its illogical level," quipped Mr. Adelson.
The house is within walking distance of the Yonge subway line and stands in the Earl Haig Secondary School district, which is popular with parents. The lot is not particularly deep but it is 60 feet wide, which makes it appealing to some builders.
Mr. Adelson says that four bids came in above $1-million on offer day. The agents gave those four competitors the chance to increase their bids and alter any conditions attached to their offers. He also looks for a hefty deposit in the form of a certified cheque in order to protect the seller.
"It's amazing and it's a little bit scary as well, to be honest," says Mr. Adelson of the action on this one. "When you get a price like this, it's off the chart."
In previous sales nearby, bungalows have sold short of $900,000.
Mr. Adelson worries that offers have become so rich that deals may fall through if a bank has the house appraised before providing a mortgage. If the sale price is too far out of line with appraised value, the bank may be unwilling to provide financing.
In this case the successful bidder is a university student originally from China with family money behind her, says Mr. Adelson. She assured the agents there would be no problem in closing the deal.
Mr. Adelson says he has been selling in the area for nearly 30 years and has trouble remembering a house in the past 10 that hasn't received multiple offers.
"We've been expecting a market correction for some time and it doesn't come."
He sees so much appetite among buyers now that he's not certain there will be a cooling any time soon.
John Whyte, an agent with Century 21 Leading Edge Realty Inc., says there was lots of buzz in his office about the outcome of this sale.
The area has seen a lot of redevelopment as builders tear down older bungalows and put up two new houses or one larger one. The area around Yonge and Finch is in high demand because of the subway and the pace of change along that stretch of Yonge.
Approximately 10 new condominium buildings are planned for the Yonge corridor between Finch and Highway 401, he says. A Whole Foods is slated to arrive and the retail strip is thriving.
"The demand is there for the area," says Mr. Whyte. "It's convenience – there are too many cars in the City of Toronto as it is."
Meanwhile, on the Toronto Community Housing file, the proposal to sell off hundreds of city-owned houses is in for some further scrutiny.
Council voted Tuesday to pass the file to councillor Ana Bailão, who will chair a working group set up to investigate all of the possible solutions to overcoming a $750-million repair backlog.
Ms. Bailão and the group will look at scenarios that include selling off some of the houses, forming partnerships with non-profit agencies, or finding ways to help tenants purchase properties.
The group is slated to come back with an interim report in May and a final report in September.
Carolyn Ireland