There’s a very simple reason for this: Supply And Demand. After a very, VERY slow start to the year buyers found their confidence (apparently all at the exact same moment) and roared off the sidelines to buy out the joint.

So how does one successfully navigate in this type of market (read: very little inventory + many, many buyers; also known as a seller’s market)? Any tips or suggestions for Toronto buyers? Do ecstatic Toronto sellers even need to take notes? How can you get cool?

Let’s find out!

A Few Tips For Toronto Sellers

• This has been a great seller’s market. If you see yourself selling your Toronto property in the not-too-distant future, for whatever reason, serious consideration should be given to getting it on the market NOW.
• It’s not always about the price. You might not get multiple offers or over asking, but go to market with a nicely-staged, well-priced listing and what you just might get is your property SOLD in a matter of days, as well as a satisfactory price. And that’s gold, baby!
• As hot as the Toronto real estate market is (and make no mistake, it’s hot), it’s still possible to overprice a property. If your house hasn’t sold in this market, it’s the price. It’s always the price. The price vis-a-vis the location and/or its condition. If you held off offers, and showed potential buyers the door because you didn’t like what you saw, you just might have passed up a great offer. Think about it.
• Take Nothing For Granted. Sellers, the market is yours. However, if you want to knock it out of the park, support your marketing strategies with these dealing-making tips.

A Few Tips For Toronto Buyers

• Inventory is depleted, Part I. Those who hesitate (read: buyers) will lose. If you delay viewing properties for even a day, you’re going to be inspecting the property while nimble buyers are signing the offer.
• Inventory is depleted, Part II. Even if you are fast out of the gate to view a property, you can’t waffle on making an offer. If you are the real deal (read: a motivated, financially-qualified buyer), AND the listing meets your requirements, AND it’s in your price range AND you LIKE it, why would you hesitate?
• Inventory is depleted, Part III. As much as buyers want to negotiate, this summer low-ball offers just aren’t cutting it. Why would a seller even consider such an offer when other buyers are willing to go in with their very best? All these offers do is make the competitive offers look even more attractive.
• Persevere. If you’re bidding in the right price range, you’ll succeed as long as your buying strategies are sound.

It’s All About Neighbourhoods
In Toronto Real Estate Market

• If you want a demand neighbourhood, be prepared to compete. Many listings will advise that offers are being held off, which is a clear signal the seller anticipates multiple offers. This, of course, frustrates many buyers, and the cries of “unfair” and “manipulative” ring out across the city. However, it’s the seller’s call as to how offers are handled. After all, it’s their property. They have absolute discretion regarding the presentation (read: when and how), the response to, and the acceptance of offers. Many listings are silent with respect to offers, but that doesn’t mean you won’t be in competition. The explanation for all of this: Supply And Demand.
• Be open to alternatives. If you’re not prepared to compete, be warned the demand neighbourhoods will offer you nothing but frustration. You’ll see properties you love that you’ll walk away from, again and again. Or, you’ll spend time making inadequate offers that only serve to make the others look way more competitive. What a waste of time! Find other neighbourhoods that are off the radar. You know, the ones that just might have everything you’re looking for with potential for price appreciation, minus the hefty price tag.
• Emerging neighbourhoods are called that for a reason. There’s a long way to go before these neighbourhoods “arrive”. Prepare to be shocked. There’s potential, certainly, but also a need for big infusions of cash. Your cash. And you might have to wait for quite some time to enjoy amenities typically found elsewhere and the reputation of trendy to be bestowed. But in the end … the rewards can be great.

I hope this has been a cool breeze on a hot real estate day!

Toronto buyers and sellers! Are you looking for a Toronto real estate agent who knows how to play the game in today’s challenging market? Call Lauren at
416–550–6991, or send me an email.

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When it comes to bidding wars, there’s not much that weary Toronto home buyers haven’t seen. Or is there?

If you’ve been in the fray of multiple offers and taking a beat down, or just observing the Toronto bidding war circus from the sidelines, you’ll enjoy the story of the bidding war that drove up the asking price of what is now the most expensive parking space in Boston. And least for today!

$300,000 price sets record – for parking (The Boston Globe)

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Same Old, Same Old
Toronto Bidding Wars

Given May’s market activity, it’s no surprise that the local media is buzzing about the re-emergence of Toronto bidding wars. And yet, how can it be called a comeback when bidding wars never really went away? Just asking!

Let me recap what’s being spun: Houses are selling for significantly more than asking price, underpricing is happening and there are buyers who “would not have bid on the property if they knew the price was not realistic”.

And that’s what gives me The Crazy Eyes. The idea being promoted that Toronto buyers are so uninformed that they don’t recognize an underpriced listing. How can that be? Is it possible that “should be well-educated” Toronto buyers are throwing themselves under the bus? Well, somebody’s throwing someone!

Top 10 Toronto Real
Estate Buyer Beware List

There’s no need to be the Toronto buyer that’s taken in by the underpriced listing. If you’re feeling frustrated with your results to date (many offers, no house), maybe it’s time to re-think how the market can work. The following Buyer Beware tips are must-read:

1. Not all bidding wars are the result of an evil conspiracy between seller and real estate agent. Sometimes a well-priced property is just that — well-priced — and it’s no surprise that the market recognizes a good buy when it sees it. The result of Intelligent Pricing is lots of attention from potential buyers, which often leads to multiple offers. You just might be the successful buyer. Or not, but if it’s in your price range you’re in the game for real.
2. Some bidding wars ARE the result of an evil conspiracy intentional marketing strategy to underprice the listing with the specific intention of generating buzz, bids and bucks. To be effective, they need you to be part of the buying circus, to create the buzz that powers the bids and bucks. It’s so simple: Don’t go to the circus.
3. Phantom offers exist, but they’re not typically used in situations where bona fide multiples are anticipated as they serve no useful purpose. Just beware of the situations where they might appear.
4. There will always be someone who has more money than you do and can out-bid you at the table. Always.
5. You will never know someone else’s true motivation. And what you don’t know is always a detriment in any business negotiation.
6. If you decide to compete, especially in hot Toronto neighbourhoods, your offer will be a firm offer (otherwise you’re sure to be sent home early). Be sure your financing is in place for the astronomical price you offer, and that you have an idea of what work, if any, the money pit property requires. And don’t forget that insurers might require certain work to be done prior to or just after closing in order for a home insurance policy to be written. Do You Have The Money?
7. Life isn’t fair. I suspect that all buyers and many, if not most, real estate agents would be delighted to see a halt to the underpriced listing strategy. But can you really envision a market where sellers give up their right to determine the list price of their properties? Me neither! So don’t waste your valuable time waiting for this practice to disappear. Seek out properties that are actually in your price range and work the offer.
8. You just might be looking in the wrong neighbourhood (read: price-wise) if you’re always on the losing end of a streak of multiple offers.
9. If the price seems too good to be true, it probably is.
10. Informed, educated buyers NEVER get played in the Toronto real estate market. So why not be that buyer??

Related MUST READ Posts:

Is A Wolf In Sheep’s Clothing At Your Door? Find Out Why Toronto Buyers Avoid The Underpriced Listing

Another Day, Another Dollar: Toronto Real Estate Market Endures Another Loonie Listing

Toronto buyers! You can successfully bid-to-buy in today’s challenging real estate market. Call Lauren at 416–550–6991 to find out how, or send me an email.

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Wow! If navigating the Toronto real estate market were only made that simple for buyers. Or IS it??

Underpriced Listings Aggravate
Toronto Real Estate Market

Unless you’ve been “off the grid” this summer, you’re probably aware there’s some … tense … feelings in the Toronto real estate market with respect to the practice of blatantly underlisting properties with the intent to generate fierce bidding wars. Although this marketing strategy has been kicking around for several years, it would appear that a cooling market has caused many real estate agents and buyers to question the merits of such a strategy; specifically, to suggest that the practice is a waste of time for both buyers and sellers, possibly detrimental to both (but especially to buyers!), harmful to the real estate industry, and so on. But I think what’s really being asked is: why won’t this practice go away, especially in light of excess inventory and statistics that point to a buyer’s market?

Are Toronto Buyers
Really That Gullible?

There are many Toronto home buyers who can attest to the fact that it’s no fun being on the losing end of a string of multiple bids. But buyers also know there’s always the possibility to be the successful bidder as long as they’re bidding on houses that are actually in their price range.

I find it hard to believe what I’m hearing these days: that there are lots of buyers being taken in by the underpriced listing, over and over again. Why? Because Toronto real estate agents (should) see the obviously underpriced listing for what it is: a marketing strategy intended to deliver buzz, bids and bucks. Because so many buyers are educated about the market and/or “how life works”. Because this strategy is just so transparent and easy to detect.

Which tells me that most buyers aren’t being fooled at all by the Toronto real estate market’s version of the proverbial wolf in sheep’s clothing.

Why Toronto Buyers
Ignore Underpriced Listings

That being said, I do understand how alluring the underpriced listing can be to buyers. I can see why buyers are tempted. The thought that there’s even the slightest chance to get into your most-desired neighbourhood can be hard to resist.

But think very carefully as to whether you want to be part of the buying circus for the underpriced listing that is, in fact, out of your price range. Think about your role and what you can expect to get for your efforts. Which is nothing.

Consider the following:

The list price is merely a tease intended to generate a buzz that will, in turn, generate lots of competing bids. A simple check of recent solds in the neighbourhood will be a very good indicator as to whether this listing is out of your price range.

By taking your valuable time to view the house, pay for a home inspection, arrange for financing, register an offer, and show up at the house to present at the time prescribed, you’ve created just the buzz this marketing strategy is intended to produce. That’s very thoughty of you!

The crowd scene at the offer presentation can further juice the competitive nature of many buyers. No one knows which buyer can’t afford to buy bubble gum, or who’s fabulously wealthy with a real estate acquisition addiction. But when face-to-face with the competition, monied buyers can dig deep and beat their own best offers prior to presentation. They’ll certainly best yours.

The successful buyer who is on the winning end of a heated bidding war knows that the seriously-underpriced listing is not what it appears. They see it for exactly what it is, they are well informed as to recent selling prices for comparable properties, and are in a financial position to make a competitive offer. They go to the table to win.

When all is said and done, you’ll be happy to know (won’t you??) that you’ve provided a very valuable service to the seller (that being the buzz), one for which you will receive no thanks or consideration. Ouch!!

I’m not seeing any upside for the buyer in this scenario. Do you really want to play into this strategy? How much free marketing buzz are you willing to provide? How many disappointments can you take? And given the Toronto real estate market’s excess inventory, what opportunities are slipping by while you chase unattainable listings?

There’s a lot to be said for the old adage, “Fool me once, shame on you, fool me twice, shame on me.”

Savvy Toronto
Buyers Bid To Buy

Here’s my suggestion to serious buyers: Let’s look at homes in your price range, find one you like and make a competitive offer. No guarantees you won’t end up in a bidding war, but savvy buyers know if not this one, then the next. If the one you like is overpriced, I’ll find out if the seller is willing to negotiate a fair price, and if not we’ll move on. If they’re underpriced but the market indicates the listing will sell in your price range, we’ll negotiate.

And here’s the upside for you in this scenario: your efforts will benefit YOU. Now that’s happy house hunting!

You CAN buy and sell successfully in today’s Toronto real estate market. Call Lauren at 416–550–6991 to find out how. I know a wolf when I see one!

But, you say, this story is generating a buzz! The “list for one dollar” strategy has focused a lot of attention on the sale of this property. There must be some merit to this approach. What’s not to love??

Quite a bit, actually!

Is The “$1 Listing” Sound Marketing
Strategy For Toronto Real Estate Market?

It’s no surprise that Toronto home owners seek a competitive advantage when selling their homes. And if the “list for one dollar” strategy has the potential to deliver the client’s desired results (read: lots of money), shouldn’t it be considered a bona fide strategy used to sell houses in the Toronto 2008 real estate market? Should Toronto real estate agents recommend this approach to their clients?

No, no, no! Even if this strategy occasionally pays off, I strongly recommend you avoid this ploy at all costs. It’s risky, tacky (there, I’ve said it!) and oh-so-transparent.

And here’s why …

It’s been done before and with not-so-great results. A quick check of the Toronto MLS shows these listings are often terminated or suspended. If this strategy wasn’t embraced when the Toronto real estate market was super hot, what are its chances of success today?  And what a waste of time; think of all the qualified buyers who bought elsewhere rather than negotiate this type of offer, and the sellers who were aggravated with lowball offers (really, you were expecting something else?).

The Toronto 2008 real estate market is in transition. Coming off its best year ever in 2007, the numbers are cooling. Based on the mid-April statistics it would appear that for now buyers are on the sidelines; they are showing signs of reluctance to write those offers. The buyers who are out looking are doing just that: looking. Even though this may just be the time to get out there and find an affordable house in a good-but-not-hot-area while interest rates are dropping and your buyer competition waits for the Toronto real estate apocalypse.

Are these the buyers who are going to pile on a multiple-bid scrum, especially one where the seller is “coy” about what price would be considered a reasonable offer or at least a reasonable starting point? Buyers are very wary about overpaying in a market that they believe may be about to dip or correct. It’s one thing to be overextended in the early days of a rising market; it’s quite another to overextend yourself at what may just be the peak. Why would a seller adopt a strategy that makes potential buyers uncomfortable and thus unlikely to come to the table?

Toronto Home Buyers
Avoid The Dork Flag

I think it’s safe to say that many Toronto home buyers are a little weary of the market. It’s become the baby you love but find hard to like. Think about it: price appreciation, losing bids, phantom bids, listings at well under market value (a close relative of the $1 listing), alarming home inspections, and on and on.

And then there’s the dork flag. Ah, the dork flag; not something a Toronto home owner should be flying when it comes time to sell their house. It can take on many different appearances but trust me, Toronto home buyers and their real estate agents know it when they see it. And avoid it they will, especially in this market.

So, what makes the “list for one dollar” strategy a dork flag? For me, it’s all about transparency. In this scenario, the seller typically makes noises about wanting to generate a buzz (fair enough) and letting the market decide the value of the house. And that’s where it all falls down.

It’s never a matter of letting the market decide value; the market will always determine value over time. It’s no secret that this strategy is intended to deliver buzz, bids and bucks. And buyers know this, especially those that have been on the losing end of a string of multiple bids. When expectations are set unrealistically high by this strategy, what are the chances that the seller will be willing to negotiate when the market brings an offer that doesn’t dazzle but reflects what it will bear? Are they willing to defer to the market? Exactly.

Fewer buyers want to play that game these days. And although it might not be seen that often in Toronto’s hot real estate pockets, there are many buyers who will not deal with sellers they believe will be unreasonable or inflexible in negotiations. Just as home sellers do not wish to tie up their properties with conditions if they believe the buyers are not serious, the same goes for buyers who don’t want to waste precious time negotiating with sellers who are elusive with their price.

It will be interesting to see what happens with Toronto’s latest $1 listing. Anyone care to make a prediction?