Real estate buyers are regaining a sliver of control in the areas surrounding Toronto as listings rise and the “fear of missing out” diminishes slightly. Or maybe buyers are just exhausted.
Houses in the small towns and suburbs are still selling at a fast clip, but some buyers are able to negotiate a deal without fighting off dozens of competitors.
Still, potential buyers are willing to compete for a property that offers a rare setting.
Leslie Benczik, broker with Re/Max All-Stars Benczik Team Realty, recently drew 27 offers for a 2.2-acre country property in Uxbridge, Ont.
The three-bedroom bungalow at 6660 Concession Rd. 2 was listed with an asking price of $1.238-million in April and sold for $1.650-million.
“The price we selected was a price to attract activity,” Mr. Benczik says. “We expected it to go for more.”
Still, Mr. Benczik and the homeowners were shocked when the buyers paid a $412,000 premium.
As Mr. Benczik expected, many of the 96 parties that booked appointments were families from Toronto.
“We geographically targeted the downtown areas with our ‘coming soon’ ads,” Mr. Benczik says.
About 30 more groups were turned away because there were no appointments left, he adds.
One main draw at the property was a stand-alone workshop with indoor-outdoor living space for the small brood of chickens that produces fresh eggs.
“I think that was something that really attracted and fascinated people. I had a lot of conversations about the chickens,” he says. “People asked if the chickens were included – which of course they’re not.”
Mr. Benczik says some properties do not spark a bidding war and there are certainly occasions when he would not set an offer date. If a house has any negative factors – say it’s on a busy street, backs onto hydro towers or doesn’t conform with principles of feng shui – Mr. Benczik would not expect multiple offers.
In this case, however, the nicely renovated home sits on rolling terrain with beautiful views from the deck. It’s close to the town of Stouffville and the GO Train.
“The Uxbridge market is a month or two behind the suburbs,” Mr. Benczik says. ”We were a bit early to market.”
Buyers looking for a country property like to walk the land, he explains, and therefore sellers often wait until wait until the snow has disappeared and spring leaves are sprouting.
He decided to list early because there were lots of buyers around and few competing properties.
Shawn Lackie, a real estate agent with Coldwell Banker R.M.R. Real Estate, says the market in areas such as Durham, Port Perry and the Kawartha Lakes remains frenetic. Sales are up and average “days on market” have plummeted, he says.
Still, the tactic of setting a low asking price and holding back offers is unpredictable. Some properties now see offer night come and go without bidders at the table.
He believes some house hunters have become weary from losing out in bidding wars.
“It’s buyer fatigue and also buyer trying to take back a bit of control,” Mr. Lackie says. “They’re saying ‘we’re not willing to jump into the deep end with four or five other swimmers.’”
Also, buyers have more to choose from as new listings increase in the spring.
While sales are still busy, amounts above asking are less earth-shaking and some conditional offers are being accepted, he says.
Mr. Lackie is sensing that more homeowners are willing to list as they see the rich prices that their neighbours’ homes are fetching. In March, Durham recorded its highest number of new listings since the supercharged market of spring, 2017.
In March, the average price in Durham jumped to $901,322 from $656,211 in the same month last year.
“That is insane,” he says.
If the current market follows the pattern of 2017, the market will soften and then flatten in about June, he estimates. But while he cautions that the market’s direction is difficult to predict, he won’t be surprised to see more craziness for the next 30 to 60 days.
Meanwhile, Mr. Lackie says, some of the same people who sold their own homes for huge amounts are frustrated when they see what they have to pay for the next property.
“You have to say to them, ‘Hold on, you’re buying in the same market. The other sellers have the mindset that you had when you were a seller. Now that you’ve put your buyer hat on, you can’t expect a deal.’”
Diana Petramala, senior economist at the Centre for Urban Research and Land Development at Ryerson University, is keeping her eye on the trend in new listings this spring.
Ms. Petramala says that, so far, outsized demand is soaking up the burgeoning new listings in the central 416 area code and the suburban 905 area code.
The Toronto Regional Real Estate Board reported 22,709 new listings in the Greater Toronto Area in March, which is up about 57 per cent from March, 2020.
Ms. Petramala says new listings hit the second highest level on record for March in the City of Toronto.
In the 905 regions, some 14,500 news listings were launched in March, which set a new high water mark. The previous record for the past 25 years was the 10,900 new listings recorded in March, 2010.
For now, demand remains much stronger than the rise in new listings, she says, keeping months of inventory low.
Ms. Petramala notes that the pandemic may be having an impact on the seasonal patterns in the housing market, which may make the rise in listings appear larger than it is. But she will be monitoring the changes.
“What happens to listings will determine how deeply prices may decline when the current exuberance fades away.”
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