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Over the last few weeks, we’ve spotted a new trend in central Toronto’s condo market….bidding wars! Yea, you read that right…bidding wars for condos. It’s been years since we’ve seen that. In the last couple of weeks, we hosted 4 multiple offers on our condo listings:
- 3 offers on day 1 – condo
- 2 offers on day 3 – condo-townhouse
- 3 offers on day 4 – condo-townhouse
- 9 offers on day 6 – loft
Scroll down past our fancy graphic (March 2016 vs March 2015) to find out what we think is happening in the condo market.
Bidding Wars for Condos: WTH?
The stats above speak for themselves…but it’s important to note, bidding wars aren’t happening in EVERY condo building.
Most popular this March: townhouses, lofts, condos in smaller boutique buildings and condos in wicked locations…they are literally flying off the shelf. The $500-650K market is also especially active right now.
Our guess as to why? As house prices have continued to spiral upwards, more and more Buyers have been priced out of the house market and are instead choosing to live in central Toronto’s condo and townhouses. We knew it would happen, but didn’t expect to see that shift for another year or two.
What to Do: for Buyers
Unfortunately, you’ll have to borrow a page from the house buyer book and arm yourself to win a bidding war [Related: How to Win a Bidding War] In short:
- Have a big fat deposit cheque ready (at least 5% of the purchase price and you’ll want to get the cheque BEFORE your offer is submitted so that Sellers know you’re serious).
- Get your financing in order BEFORE the offer – yep, that means you’ll want to make an offer with no financing condition if you want to win it. We’re not saying not to do your due diligence – but you’ll need to do it before the offer instead of after.
- Have your lawyer review the status certificate BEFORE the offer. This is an important part of the condo buying process and you’ll want your lawyer to review the condo financials, outstanding lawsuits and what’s happening with condo maintenance fees. If there aren’t multiple offers on a condo, this normally happens after a Seller accepts your offer – but if you’re in competition, you’ll need to have this reviewed before the offer so that you can submit a non-conditional offer.
- How much to pay? Valuing a condo is easier than valuing a house because there have likely been very similar or identical sales in the building. But if you’re in multiple offers, you’ll likely need to PAY MORE than the last sale in order to win it. A good REALTOR can guide you on price.
What to Do: For Sellers
If you own a loft, condo townhouse or unique condo in a boutique building, stop thinking about selling and get on it! We can help!