With a severe contraction in the number of houses for sale in Toronto and surrounding cities, anxious buyers have been lobbing money at the few properties that do arrive on the market.
In Oshawa, Ont., and other parts of Durham Region, Shawn Lackie, a real estate agent with Coldwell Banker R.M.R. Real Estate, says buyers have been paying eye-popping premiums even for modest houses.
“These places that are selling are little shacks,” he says.
Mr. Lackie sees worrying signs in the bedroom communities east of Toronto: Even during the frothy days of 2016, buyers typically only entered competition for the most desirable houses, he points out.
“They were bidding on properties that were worthy of insanity,” Mr. Lackie says. Now, “it’s right across all areas and all sizes. We’re back to full-on madness.”
He points to one recent example on Olive Street in Oshawa where a 1,100-square-foot house was listed with an asking price of $650,000 and sold for $802,000 after five bullies submitted bids ahead of the date scheduled for reviewing offers.
Mr. Lackie notes the house last changed hands in 2018 for $200,000.
Another bungalow of about the same size was listed with an asking price of $499,000 and sold for $713,000 in Oshawa.
In the small town of Orono a little farther east, a house listed with an asking price of $499,000 sold for $731,000.
In Mr. Lackie’s opinion, the growth in prices is not sustainable.
When he works with buyers, Mr. Lackie advises them to think about their exit strategy before they purchase a property. Buyers need to think about how long they want to live in the property and whether the amount they’re paying represents good value if they sell after a number of years.
He fears that people who are paying amounts far above recent sales in the area are getting way ahead of the market.
“If you’re paying $800,000, how long do you have to live there until the market comes up to the home? People are throwing money around like drunken sailors. I’m not really a fan of this.”
Mr. Lackie says the combination of a lack of supply and rock-bottom interest rates is driving the run-up.
He adds that some of the purchasers appear to be first-time buyers who want to get into the market at any cost. Others are homeowners from Toronto who are flush with cash from selling a property in the city.
If homeowners sell their house in Willowdale for $1.6-million, for example, they don’t have a problem offering $800,000 or $900,000 in a small town because they still have $700,000 left over.
The inflation is leading to mounting frustration for local people who have been saving up for a house over time, he adds.
“They’re getting blown out of the water,” he says. “They can’t compete with that.”
Mr. Lackie worked with one young Toronto couple who were renting a 740-square-foot townhouse in Liberty Village, he says, and wanted a backyard for themselves and their large dog.
Mr. Lackie says the couple looked at townhouses in Whitby and other parts of Durham, but they found the properties that fit within their budget small and uninspiring.
When they extended their search north and east to Port Perry, they found a vacant bungalow listed with an asking price of $750,000. They first submitted an offer of $695,000 and, after some back-and-forth, signed a deal for $715,000.
The couple was nervous at the time, Mr. Lackie says, but other bungalows nearby have since sold for $775,000 and $760,000.
Looking ahead, Mr. Lackie expects the runaway price growth to slow at some point.
“This is accelerated. They’ve got their foot on the gas pedal and I don’t know how long this can go.”
The Canadian Real Estate Association reports that the number of listings across Canada stood at fewer than 100,000 on New Year’s Day, which marks the lowest tally recorded in data going back three decades.
Sales were up by more than new supply in December, CREA senior economist Shaun Cathcart says. The national sales-to-new-listing ratio tightened to 77.4 per cent – among the highest levels on record for the measure. The long-term average for the national sales-to-new-listings ratio is 54.2 per cent, Mr. Cathcart says.
Elise Stern, a broker with Harvey Kalles Real Estate Ltd., says buyers in Toronto grappling with the low supply are using tactics such as bully offers to get ahead of the competition.
Her clients recently tried to submit a bully offer for a four-bedroom house in Thornhill Woods with an asking price of $1.699-million. The sellers declined to look at the offer, so Ms. Stern’s clients showed up on the scheduled night with a bid of $1.761-million, which the homeowners accepted.
The house on a quiet cul-de-sac was previously listed in December, 2019, with an asking price of $1.588-million, but at that time it failed to find a buyer after 50 days on the market.
Ms. Stern says one reason for the low supply in the city is that some sellers prefer to sell quietly without launching their home on the Multiple Listing Service of the Toronto Regional Real Estate Board. The homeowners are reluctant to have numerous people through the property and they also don’t want to undertake the decluttering, painting and staging that helps to make a home appealing to a wider pool of buyers.
Ms. Stern has recently sold two properties on an exclusive basis.
In such deals, sellers are saying “this is the number that I’d be prepared to sell it at today,” and Ms. Stern puts the word out to fellow agents and her own list of buyers to see if there are any takers.
“The exclusive network is up-and-running.”
Ms. Stern expects the intense bidding to continue because buyers have preapproved mortgages with low rates lined up, and they become anxious when they miss out on properties that sell to competing buyers. If they sit on the sidelines, they see prices rapidly escalate.
“If a house sells for a lot of money, that becomes the new benchmark,” she says.
Ms. Stern advises clients to visit a mortgage broker and become educated about the market action in advance so that they can feel confident when the time comes to make an offer.
“I try to keep them level-headed,” she says. “I don’t ever want them to overextend themselves financially.”
Source:- The Globe and Mail
Canadian Real Estate May Get Cooling Measures As Early As This Month: Scotiabank – Better Dwelling
One of Canada’s big banks expects cooling measures for real estate soon. Derek Holt, Scotiabank’s Head of Capital Markets Economics, sees the Spring Budget including cooling measures for real estate. In a note penned to investors, the economist highlights how policy has been overly loose. He feels the next budget likely includes measures to cool the market, which can come as early as the end of the month.
Canadian Home Sales Are Unusually Strong For A Pandemic
Canadian home sales are extremely strong. Not just for a recessionary environment, but in general – they’re better than they were in Canada’s best economy. Holt points to Toronto home sales reported earlier this week. Sales were up 15.9% for the previous month, when seasonally adjusted (SA). This follows a 3.1% monthly increase in January, which followed a 21% monthly increase in December. He also notes these increases are accompanied by fast rising home prices.
Greater Vancouver also reported an equally hot market just a day before Toronto. National sales data will be released later this month, and is likely to show similar trends across Canada. This is occuring in the winter, which Holt emphasized multiple times. He further adds, “Apparently, there are a lot of masochists out there who are not fussed one bit about moving in -20’C or colder weather and heavy snow!”
Canadian Home Permits Increased Over 7%
Canadian new home permits are also a point watching, according to Holt. He highlights house permits increased 7.3% m/m in January. This breaks down as 15.1% m/m for singles, and 4.1% m/m for multiples. This doesn’t just highlight a rapidly expanding market, but “reinforces the move to the ‘burbs” narrative, he stated.
“If Canadians are taking out permits and buying resales at such a pace during the winter, what does that say when the key Spring housing market and vaccines arrive?” Holt wrote. Adding, “Policy is arguably overly easy and macro prudential changes may be afoot in a Spring budget.”
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These are the cheapest real estate listings in Calgary right now | Urbanized – Daily Hive
Good news for YYC house-hunters – you don’t have to break the bank to purchase your own home.
In this month’s roundup of Zoocasa’s cheapest real estate listings in Calgary, affordable properties can be found throughout the city for under $300,000.
A lower budget doesn’t mean you have to compromise your standards, as most of these properties offer updated kitchens and bathrooms, recently replaced flooring, and state-of-the-art appliances.
If you’re in the market for a new home, take a peek at these Calgary real estate listings.
- Three bedrooms
- One bathroom
- 826 sq ft
This Pineridge home is close to schools, playgrounds, and shopping, making it a convenient location for anyone. The property offers a detached garage and a fully-fenced yard.
- Four bedrooms
- Two bathroom
- 1,132 sq ft
Located in Copperfield, this townhome features a fully developed basement, spacious tiled front entryway, and upgraded appliances in the kitchen. This is an end-unit property boasting tons of natural light and electric fireplaces.
- Two bedrooms
- Two bathrooms
- 1,174 sq ft
This bungalow-style condo is located in The Highbury building in Evergreen Estates-Shawnee Slopes. The unit was recently updated and has stainless steel appliances, a spacious master bedroom, a walk-through closet, and luxury vinyl plank flooring throughout. Condo fees include everything except electricity.
- Two bedrooms
- One bathroom
- 441 sq ft
In this Mayland Heights bi-level home, house-hunters will find large windows, a dining area with a cozy built-in bench, and a spacious balcony with downtown and mountain views. The unit has been freshly painted and boasts new laminate floors.
- Three bedrooms
- One bathroom
- 1,099 sq ft
Live in this new Fonda condo, featuring a renovated kitchen with stainless steel appliances, a main floor office, and laminate-engineered hardwood flooring throughout. The upper level is home to a spacious master bedroom and recently renovated four-piece bathroom.
Real estate company says demand for housing in Niagara will continue to grow – NiagaraFallsReview.ca
A Hamilton-based real estate company says Niagara’s economy as well as its real estate market are poised for continued growth.
After placing a renovated 12-unit apartment on Drummond Road on the market, Crescendo Equity secured a total sale of $2.9 million. That translates to $247,000 per unit, compared to a previous benchmark of $176,000 for units in the area.
The company predicts demand for housing in Niagara will continue to grow through 2021.
”Market conditions are being strengthened by interprovincial migration, as home buyers and renters from the Greater Toronto Area, Peel and Halton regions look to Niagara for more space and better affordability,” said Mathew Moxness, Crescendo Equity’s founder.
The Drummond Road property is part of the company’s larger strategy to take older, underperforming stock and reposition properties for maximum occupancy and potential.
“With growing demand for multi-family housing throughout Ontario, repositioning aging and underperforming assets will help to supply the segment and provide housing for those who need it,” Moxness said.
The company, which offers opportunities to private and group investors, purchased a shuttered retirement home in Niagara Falls last year, and plans to convert the property into apartments.
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