Condo towers in Toronto.Peter Power/The Globe and Mail
In our Living in Retirement blog, a recent retiree chronicles the ups and downs of her real-life retirement journey.
When I decided to sell my condo in Toronto's trendy Queen West district, my real estate agent did everything possible to alert me to the challenging conditions of today's condo market. Unlike the giddy real estate flyers that land weekly in my mailbox, my agent calmly laid out listing and sales spread sheets for my building. The numbers tell the story: flyers raise expectations. Spread sheets keep it real.
Of the 88 condos in my downtown building listed from April 2013 until mid-March 2014, only one unit, a moderately priced one-bedroom, one-bathroom, sold for more than the listing price of $345,000 and that was by $6,000. Most units sold at $5,000 to $10,000 below the asking price. Thirty-seven units never sold at all. The overwhelming reason for that is they were overpriced.
When I decided to list my two-bedroom, two-bathroom condo I won't say I wasn't filled with trepidation. What if it didn't sell? What if I was stuck here even though I was ready to relocate to more spacious digs and already had set my heart on moving?
We priced the condo at $449,900, $10,000 lower than my agent had first suggested. My reasoning was that condo shoppers scouring the Internet might input $450,000 as their top price, and I didn't want to miss out on potential buyers. What I wanted to avoid was watching my condo languish on the market for months without culminating in a sale.
But it did sell and in seven days. This is what my agent and I did to make that happen:
1. We decluttered. I hired a sizeable storage locker near my former residence in Oakville. We packed up most of my books, struck the shelves that were cluttering the hallways and wrapped all the photos and chachkes in newspaper for storage. Summer clothes, dishes and even the wine rack were loaded into the locker. Toiletries were hidden in the closet. If I wanted to wash my hair, I needed to dig for shampoo.
2. We fluffed. My agent stared at my bed covers and made a face. Since she is so gorgeous, it bothered me when she frowned. Obediently I scurried to IKEA to purchase new pillows, pillowcases and bedspreads that made the bedroom resemble a hotel.
3. We redecorated. A few scratches on the wall were painted. Grace Kelly, a.k.a. my agent, then brought her own pillows (what seemed like hundreds of them) to arrange on the beds and sofas. Paintings, baskets, pinecones and candles were gracefully staged.
4. We vacated. Every day that the condo was up for sale, my partner and I were vagabonds. Even though I was in the middle of the media campaign for my novel, we left the condo for two open houses and each showing.
5. We worked with the first reasonable offer. The first bid was submitted seven days after the listing appeared on MLS. We accepted this offer on its second iteration. It was $10,000 less than the asking price and we took it - with very few conditions. My agent worked diligently to negotiate a higher price. The buyer's agent took a drop in his commission.
On Queen West, new high-rise condos are sprouting up on every corner. These units mainly appeal to a specific demographic of young professionals on the look out for their first home. A huge jump in the price of detached and semi-detached houses, as well as more stringent government regulations, are sending these young people to the condo market. But amid a glut of new condo developments, there is nonetheless a reluctance to spend too much on too little.
When I ask myself what I did right, I'd say I listed my condo at a good time, just before the spring rush of newly listed re-sales hit the market. The fact that my building is crawling distance to two hipster hangouts, the Drake and Gladstone hotels, helped drive a brisk number of showings. Interest rates are still low and the new constructions surrounding my condo are not yet complete. From day one, I kept my expectations in line with the information on my agent's spread sheets and I supplemented that with hours of my own online research. And since I purchased seven years ago, before the condo was constructed, I did realize a profit on my investment.
When I ask myself what I did wrong, I'd say I didn't envision how many more condos would pop up in my neighbourhood. I thought living in a concrete jungle would deliver its own charms. I didn't take into account that the me of 30 years ago, who lived in a loft on Queen West, has changed dramatically. Things like green grass and trees and proximity to Lake Ontario matter more than I reckoned.
More than two years ago, I took a big risk leaving Oakville for Queen West, particularly since I'm semi-retired. Moving is certainly not cheap. Factoring in realtor fees, land transfer tax, moving and legal costs, this adventure from the suburbs to downtown and then back out again put $100,000 in my pocket. And although it doesn't compare to the recent profits made on sales of single family dwellings, it's nothing to sneeze at.
In my next blog, I'll talk about hunting for a new dwelling - my final retirement home - on a budget.