REAL ESTATE MARKET UPDATE MAY 2016 - TORONTO - GTA
Dear Friends ,
The Toronto real estate market continued its torrid pace with the sale of 12,085 homes in April, the best April in the 100 plus year history of the Board, and up 7.4% over April 2015.
While the average price in all of the Toronto Real Estate Board marketing areas for all types of residences now stands at $697,679, the price breakdown for local areas is as follows:
City of Toronto $718,682 (Detached Homes only in April $1,257,958)
York Region $896,476
Durham Region $494,643
Peel Region $582,496
Is there a real estate bubble? Will prices adjust? Is it too late to buy? These are questions I am continually asked, and while everyone has an opinion, no one, truly knows. Economic forecasts and weather forecasts are similar. The systems are just too complicated and the experts are best guessing with the information at hand, and that changes minute by minute.
Here is what I say to my clients….
....if you're selling a house, the timing is wonderful!
Bidding wars can be seen in every segment of the market whether it’s a condo, townhome , semi-detached or detached home - makes no difference.
If you are buying a home …. The following tips are ways in which will help win that dreaded bidding war ….
Sellers often choose the offer with a certified cheque attached - this demonstrates to the seller that there is no financial risk in the bid in hand – a super way to stand out and provide confidence to the seller.
Get a pre- appraisal - Canadian banks will perform an appraisal of the property in order to have a closer look at the house – normally this happens after the sale however, the market is hotter than hot these days and the selling prices are actually higher than the post-sale bank appraisal value. Somewhat a new thing; you the buyer should push your bank or mortgage provider to do an appraisal before the offer day, so if the appraisal is lower than the sale price, then you the buyer can be ready to show the seller you have extra money to back you, should the bank fall short. Showing perhaps a money gift from family would certainly be a great thing to share so the seller knows you are good for it.
Whenever possible I prefer to present offers in person and attach a short note or verbally offer to the sellers and their agent a short bio “ if you will “ about the buyers. To some sellers this can mean a lot – nice people want to sell to nice buyers. I've witnessed and won many times, if there are multiple bids at the same price, the bid that comes with a short bio of the family who is keen to buy the home often comes away with it.
It’s best to leave conditions out – an offer with a condition these days will always lose. Someone else will, without a doubt offer a bid without conditions and ultimately win that bid.
Pre-emptive or bully offers are common these days as multiple buyers vie for that same house …. the way it works is; typically when a house comes on the market, the buyer will submit a huge bid almost as soon as the house comes to market in the hopes that the seller will take that offer rather than wait for the offer date and other bids. By offering a large sum / offer, a bidding war can be avoided to the benefit of both buyer and seller. If you opt to go this route, then you must offer a very large sum in order to get the sellers attention.
Be sure to stay calm and keep your head about you – do not spend more than you can afford and just give it your all.
Think rationally and look ahead, as you should be able to use the home for minimum 7 - 10 years and be able to survive a downturn in the market. Also, we mustn’t assume the prices are always going to go up at this pace.
Waiting for prices to come down is a huge risk in Toronto. Prices may be down in other areas such as Barrie, but not here in Toronto. Prices continue to rise in this segment of the market because people want to live and work in Toronto.
Always, go with your best offer ! The sellers may come back if the offers are many and similar, thereby giving you another chance but most likely you will not get that second chance.
A quick look back in time ….
In 1975 the average price was $57,581
In 1995 the average price was $203,028
In 2015 the average price was $ 622,217
Who knows what the next 20 years will bring, but I do know Toronto will continue to grow and people have to live somewhere!
Have a great May and don’t forget, I am never too busy for your referrals!
Your friend in Real Estate.
Suzana ( Sue ) Davies , Sales Representative Remax Realtron
firstname.lastname@example.org 416-843-7017 www.suzanadavieshomeseek.com
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