Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Cancel Anytime
Enjoy Unlimited Digital Access
Canada’s most-awarded
newsroom for a reason
Stay informed for a
lot less, cancel anytime
“Exemplary reporting on
COVID-19” – Herman L
$1.99
per week
for 24 weeks
Get full access to globeandmail.com
Just $1.99per week for the first 24weeks
Just $1.99per week for the first 24weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

Townhouses in Toronto's Parkdale neighbourhood, December 14th 2015.

Ian Willms/The Globe and Mail

Last week, Nick Whittington helped his clients shoot past two other bidders for a narrow Victorian semi near Trinity Bellwoods Park.

The agent with Brad J. Lamb Realty Inc. says his clients are delighted they have a new project to work on. Mr. Whittington is relieved the couple was able to nab a new property before bidding war fatigue set in.

"You can only take a buyer through that three or four times before they start cracking up."

Story continues below advertisement

This is the time of year when buyers in Toronto's ultra-competitive market often drop from sheer exhaustion. As Mr. Whittington suggests, they fear for their sanity after pouring their emotions into one bidding contest after another.

Even some condo units are attracting multiple offers at the moment – often to the surprise of the agents listing them. But freehold houses in prime neighbourhoods are pretty much guaranteed to have people fighting over them.

"It only takes two," Mr. Whittington says of the pressure that arises any time there's competition.

The clients who bought the downtown semi had a strong determination to acquire the house that was listed with an asking price of $990,000. Mr. Whittington prepared three offers with ascending prices.

They submitted a bid for $1.05-million and waited. The listing agent told them three parties were in contention and gave all three a chance to improve their offers.

"I'm not going to lose this over price," Mr. Whittington's client told him, and gave him permission to submit the second offer for $1.175-million.

About 20 minutes later, the listing agent informed them that they had a deal.

Story continues below advertisement

In this case, the buyers had already sold their existing loft. The strain really shows on those buying for the first time, Mr. Whittington says. He has worked with buyers who have lost out when properties go for mind-blowing amounts in popular neighbourhoods.

"The people are just demoralized," he says. "How can you even gear up for that?"

Mr. Whittington says most first-time buyers aren't even looking in Toronto's core any more. Some are purchasing recently-built townhouses in neighbourhoods such as Mimico and Long Branch, he says. Others are buying condos in new developments in the Upper Beaches, where units can be found in the $600,000 to $635,000 range, he says. And still others are looking for detached houses in areas farther to the east, such as Whitby.

Mr. Whittington sees older parents with assets in fixed income and their investments are generating no return. Those parents made a hefty profit on their houses and they fear the younger generation will miss out if they don't get into the housing market soon. Those are the parents who are really pushing their kids to buy, he says. In many cases they're lending them the money to do so.

"Without a big cheque from mom and dad, it's almost impossible," he says. "When freeholds are going up 12 to 14 per cent a year, who the hell can keep up with that?"

Buyers need not only a substantial down payment but a big chunk for land-transfer taxes as well.

Story continues below advertisement

Mr. Whittington believes the reason we're seeing so many people paying $200,000, $400,000 or even $600,000 above the asking price for a property are doing so out of despair that prices are spiralling out of reach so quickly. Of course that psychology fuels further gains and even more anxiety.

Plenty of recent purchasers in Toronto and Vancouver were motivated by "fear of missing out", or FOMO, according to the results of a recent survey by Toronto-Dominion Bank.

TD says that some prospective first-time buyers in Canada were also worried that their FOMO would lead to other problems. About 20 per cent said they feared they would rush into a purchase to avoid missing out on an opportunity. Eighteen per cent of respondents fretted about buying too quickly in order to win a bidding war.

TD didn't explain why 81 per cent of Torontonians and Vancouverites didn't experience FOMO.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the author of this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies