Listen to the data, not the drama

I’ve noticed there’s been new interest in the market since the Bank of Canada announcement last month. In my experience, showings are up, open houses are busy, and a lot of first-time-buyers are finally testing the waters.

Buyers today are cautious, which is smart, but too often, they’re believing headlines over data, and more troubling, agents aren’t preparing their clients with real numbers and context.

Here’s a real life example.

We recently sold a home in the Dovercourt-Wallace area where the average price for a semi-detached is $1,296,000. Zoom in further, and a three-bedroom, two-bath semi with parking averages around $1,303,000, with recent sales ranging up to $1.6 million.

With above-average finishes, a dugout basement, a beautiful extension with wall-to-ceiling windows overlooking a private, tree-lined backyard, and a rare, double-car garage, we priced our home at $1,199,000 to get people in the door. 

Seventy showings later, packed open houses, and 17 offers on the table, seven of those offers landed around $1.2 million, below the average sale price for the area, on a home that was well above average.

This was a clear sign many buyers and their agents aren’t reading the market correctly. Toronto currently has about 2.7 months of inventory for freehold homes. In other words, if no new houses came up for sale, everything currently on the market would be sold in under three months. That’s hardly a buyer’s market.

The home sold for $1,605,000.

On the flip side, if you’re a seller and not informed about the real value of your home, or you’re working with an agent who lacks the confidence and market knowledge to guide you, you could easily leave money on the table thinking it’s just a bad market.

I experienced this with another recent sale. 

We had about 30 showings and over 40 groups through the open house. But on offer day? No offers. The catch was parking, or lack of it. That seems to be a major sticking point for buyers right now. 

We had a few agents call with verbal lowball offers. The kind of calls that could shake the confidence of an agent who doesn’t know the numbers. Instead of reacting, we raised our price slightly above our expectations. We had originally priced low with an offer date in mind and knew buyers would want room to negotiate. Thirty days later, we sold close to our original expectations, with a quick close that worked well for my clients who had already left the country.

Buyers are trying to test their leverage, and fair enough, that’s their job. But sellers, remember: patience pays off. It can take some time to get the number your home deserves.

So here’s our biggest takeaway this month:

• If you’re buying, know your numbers and ask these two questions:

  • What’s the average sale price for a home like this in the area?

  • What did the last sale similar to this, go for in the neighbourhood?

• If you’re selling, confidence comes from information, not assumptions.

And if you’re working with an agent, make sure they’re experienced enough to tell you the truth, not just what sounds comforting. 

The market isn’t broken. It’s recalibrating, and in a recalibrating market, knowledge is everything.

Curious how this plays out for your home or your budget? Let’s talk it through. There’s no pressure, even if your move is two or ten years away, I’m always happy to share what I’m seeing and help you make sense of where things are headed.