Good morning everyone and my apologies for the break in weekly communications. It has been busy both in business and in family affairs.
This week in the market – Condos versus Freehold (A tale of 2 different markets)
In the Toronto (416) city core bidding wars are prevalent with the majority of new (decent) inventory being marketed with a stalled offer date. This week I took part in 2 offer presentations setup with an “Offer Night”.
1) A very cute, well maintained but dated bungalow listed at 629k (worth about 615k-625k based on recent sales) in a desirable neighbourhood. On offer night two competing offers emerged and the final sale price was 641k. My clients stuck to their pre-determined max price (A very good thing to do before making an offer based solely on emotions).
2) A renovated semi in the junction neighbourhood listed at 649k (worth about 675k-690k based on recent sales). On offer night there were 8 offers. I unfortunately guessed predicted at least 8 offers would be competing. Again, my clients put forth a very strong offer but ultimately another buyer did something silly. The final sale price was 775k! $125,000 over asking. In my experience whenever there are 4 competing offers or more, somebody throws caution to the wind to acquire the property. My clients like in the first situation were smart and stuck to their pre-determined max as they should of.
The condo market is still overall strong and stable, however the difference for buyers is that they do have choice as there is a healthy supply and bidding wars are uncommon. A buyer can view several suites and compare and even negotiate a good deal. Some exceptions exist of course. For example, in the Yonge and Eglinton area units are in high demand. You may or may not get a bidding war but the suites do sell quickly.
1) Last week I was able to help a client secure a fantastic unit close to the lake. The condo was originally listed at $315,000 but after 3 weeks was reduced to $299,000 and ultimately was purchased at $286,000.
2) I am currently marketing a wonderful 1 bedroom suite at Sherway Gardens (West end) listed at a very fair price of $278,000 and although there has been good interest from my own client base and other buyers it remains available. It’s a great unit for an investor to lease out or move in for an end user. I can send pics and a description to anyone who is curious.
The Bank of Canada has left the overnight interest rate unchanged at 1%. This is the 22nd consecutive announcement without an interest rate move (Since September 2010). Canada’s economic growth has been revised down slightly from previous forecasts and as such rates will continue to stay low. Canada expected economic growth is expected to be a little slower than United States over the next two years but it is also expected to outpace Europe.
3 Home Inspection Myths Exposed By Dan DaCosta on May 29, 2013
According to Realtor Magazine, “an estimated 70 percent of all homes sold annually receive a home inspection,” yet there are still many misconceptions about the process itself.
Here, the three most frequent home inspection myths will be addressed:
1) Asbestos is always dangerous and should be removed immediately – In some older residential homes asbestos can be found in the attic as insulation, and was also often used to insulate hot water heating systems. If you find out that your home contains asbestos – don’t panic! As long as you are not doing major renovations or demolitions, in the majority of cases, doing nothing is the best approach. In any case, you should have an experienced contractor or inspector examine everything thoroughly and advise you on your best course of action.
2) New homes don’t require home inspections -Even though a newly constructed home is covered under warranty, it is always in your best interest to do a home inspection. Your builder may have tried to save costs by building to the minimum requirements in existence at the time of construction, or workers may have simply forgotten to complete small (but potentially important) jobs in a rush. Municipal inspectors overseeing the construction site may not have spent enough time in your house to catch everything. There could be problems with the house that are not necessarily code violations, yet could have serious consequences for you as the buyer.
3) All home inspectors are regulated and certified or licensed to date; home inspector training has been voluntary in Canada except in British Columbia and Alberta. In provinces like Ontario, it’s considered “self-regulated” and those conducting inspections should ideally be associated with a reputable or accredited home inspection organization (for instance, the Ontario Association of Home Inspectors).
I encourage you to make sure to do your research and ask your home inspector for their previous experience, references, proof of insurance, and their certification from their respective Association. Your real estate sales representative should be able to recommend someone with the necessary credentials.
Next week I will be able to share the May sales numbers and provide some more useful statistical information.
Thank you and have a great weekend, Anthony