As the temperature rises, Toronto’s real estate market is following suit.
Toronto’s February 2021 sales transactions increased by 51% compared to same time year ago. On the pricing side, there was double-digit price growth for detached and semi-detached properties while condo prices on average dipped by 6% over this same period.
It’s become common for properties to receive more than 10 offers. I’ve even had clients make an offer against more than 40 other potential buyers. So why is there so much activity? There are the easy answers such as:
– Low interest rates giving buyers cheap access to money.
– Properties are routinely underpriced.
– The acceptance and prevalence of digital signatures simplifies the preparation of offers
– In person offer presentations are impractical so even unrealistic offers are made without a Realtor expending an entire evening waiting outside a Seller’s home.
When considering consumer preferences and historical sales volumes, the frenetic activity we are seeing shouldn’t be all that surprising.
Ipsos has polled buyer intentions every 4th quarter since 2016. There is currently a larger cohort of buyers as respondents stated that the likelihood of buying increased from 32% in Fall 2016 to 42% Fall 2020.
Preferences shifted as Buyers were 26% likely to purchase a condominium in the Fall of 2019 but were only 19% likely to buy a condominium Fall 2020 as freehold detached and semi-detached became even more desirable during the pandemic. These preferences are reflected in the February 2021 prices in the table above.
As for sales volumes, much is written about the tight supply as 2016 annual sales were the highest of any in the past decade.
While 2016 was a banner year in terms of sales volumes, we are on track to surpass that in 2021.
With record setting YTD sales so far, it’s likely that real estate activity will remain strong as we prepare for a comprehensive vaccine rollout and look forward to a return to pre-pandemic life.
And now over to Shen.
Shen Shoots the Breeze
Last year I took over the property management arm of our real estate business.
Last week, an agent brought an offer to lease for one of the properties I manage. The tenant supplied an employment letter which showed proof of income. On the surface, it looked good but during the verification process, we discovered the Tenant provided a false document.
After I conveyed this to the agent (who was as surprised as we were), the tenant was came back with an audacious request to see if we would consider accepting him if he increased the deposit. Suffice to day, the landlord declined.
While most of our readers are home owners, here are some tips for tenants.
- First impressions go a long way. Landlords or their agents are sizing you up from the very first contact. So be courteous and sound engaged. You won’t believe how many times I get calls from prospects who sound like they just woke up or sound aggressive. If you are working with a leasing agent who is doing the search on your behalf, they become your voice so ensure they are also agreeable.
- Have your documentation ready: Photo ID; credit check; letter of employment; rental application with references; recent pay stubs. These documents are needed. If anything is missing, it will either delay the process or if you drag your feet it will signal a red flag. It may seem invasive but a landlord leasing one of their most valuable assets will know more about you than if you were buying or selling a property.
- If you have something that is unfavourable – ie, less than desirable credit score. Be up front with the landlord and explain your situation. They appreciate that more than if you try to gloss over it or try to cover it up. Now is not the time to turtle and hope it just goes your way.
- Feel free to ask the landlord on the lease process if you don’t understand what you are getting into. Also don’t be afraid to ask for improvements while you’re negotiating the lease; just be nice about it.
- Finally, although the process has been designed for the landlord to assess a tenant’s suitability, this is also your chance to assess the landlord. Mind you it’s more of an art as you want to ask good questions but not make the landlord feel like they are in the hot seat. As an agent, I don’t mind if a tenant shared that they had a less than stellar experience with a former landlord and hence the reason for certain types of questions.
A good landlord who cares about their property will take the time to ensure that your story checks out. More often not, these thorough landlords are also responsive to ensure that a Tenant is happy in the home.