Which risk will you take in an unpredictable market?
April 2, 2018
If you’ve read an article about the GTA real estate market, chances are you have the impression that the sky is falling and if you look at the numbers overall, prices are down from this time last year and sales are also down by volume.
The problem with looking at the big picture is that it doesn’t tell the whole story. The GTA isn’t one big market, it’s a bunch of smaller ones. Single family homes in the 905 are a completely different market than homes in Trinity Bellwoods. And the housing market in Trinity Bellwoods is a separate market from condos in the same neighbourhood. So while saying that in February 2018 the number of homes sold was down by 35% is true, it’s just not accurate.
So what is really happening? The downtown core is pretty insulated from the media reports that the market is going in the opposite direction. Many homes being listed under $1M will almost undoubtedly sell for $1.2 and $1.3. Higher end properties over $1.5M are taking a little longer to sell, they tend stay on the market longer in this kind of market.
There are particular pockets in the city where there’s more of a likelihood that a series of events will be followed – in a hot neighbourhood such as Leslieville, with a semi priced under $1M, chances are it will be listed at the beginning of a week, there will be an open house the following weekend and offers will be received on the following Tuesday or Wednesday night, with the property selling above asking, especially if the house has been renovated.
I went to see an amazing house near Dundas and Logan that oozes potential but was in incredible condition for a property that’s unrenovated. It needs some updating, but it has been well maintained. It’s listed for $800K and has since sold… and I strongly I suspect that once the price is disclosed, it will have sold for over $1M as it’s one of only a handful of houses available.
It depends on the property, too. I went to a listing presentation at a condo recently and I’m confident the sellers will receive multiple offers; it’s lofty, it has exposed concrete, well maintained, modern furnishings and clean, all the aesthetic points people are interested in… it won’t stay on the market for more than a couple of days.
The challenge is that if when it comes time to speak with a seller who’s home is in another part of the city, it might sit on the market a little bit longer. One just never knows because the market overall is unpredictable depending on the price point, the home itself and the competition at the time one puts their home on the market.
The conversation with buyers and sellers in 2018 revolves around the unpredictability of the market. In many parts of the city, it’s hard to pinpoint what’s going on. The market changes on a daily basis and the people who are out looking to buy is also changing. What happened yesterday may not happen today. You have to be prepared for whatever might come.
A property might stay on the market, another may come on the market that’s more favorable to buyers and yours could sit while the other sells.
People who were thinking houses were unaffordable and bought a condo are now reconsidering a house as the price gap is narrowing.
The conversation is still the same with people who are both buying and selling. What is their biggest stress – not knowing where they’re going to move to if they sell first or buying a new home first before selling their current home?
The timing is actually important too – if you’re trying to sell your home now, we’re coming into the spring market so with more listings available, there’s a higher chance you’ll find something you’ll like. But if it were the end of November and you had to buy something, fewer properties are available, so you may go a while without finding the right place due to the holidays.
It’s about strategizing your end-game and knowing which risk you’re most comfortable with.
Please give me a call if you have any questions about navigating Toronto’s real estate market!