Welcome to the August 2018 Home of the Month! This feature provides a snapshot of what Urbaneer's Buyers have recently purchased in the City of Toronto. This month’s real estate buy is about the journey of a first time buying couple who competed in 6 bidding wars over a 12 week period from the end of January to the beginning of April during the height of the spring market.
Did you know there are Seasons To Real Estate?
In their early 30s, these newlyweds found themselves embroiled in the intensity of this year's spring market, which by my account signalled the recovery of the downtown freehold housing market after The Provincial Government Unveiled The Ontario Fair Housing Plan in April 2017. I documented this in my Tales From The Real Estate Trenches blog category about real-time experiences on the dynamics of the Toronto real estate market. You'll see the specific links below.
These Buyers were seeking the highly coveted but rare unicorn of a dwelling where they could put their personal stamp on it, without having to undertake a substantial renovation. Properties like these don't come to market frequently in downtown Toronto, which is unfortunate as there is a large market of Buyers whose wish-list includes a house which is structurally sound, has updated mechanical systems and building components, but ideally is aesthetically dated, tired or obsolete in its finishes and fittings, making it ripe for a design elevation (Here's one of my essential reads that will help you Understand The Six Essential Layers Of Property). Sadly, Toronto freehold housing stock that falls into this middle ground are few and far between. In downtown Toronto houses are more likely to be either renovated and sold turn-key or - given our housing stock dates mostly from the 1850s - are vintage wrecks ready for a complete 'gut to the studs' overhaul. I don't consider this surprising, as it's rare a Seller will invest capital into the nuts and bolts of a property and bypass upgrading the kitchen and bath which offer the greatest financial rewards in Buyer appeal. When these rare 'in between' properties do come to market - I find they're most likely homes which have been owned by the same Seller or family for decades - whom are sufficiently 'house proud' to have kept their property in good nick, but they haven't 'renovated' in order to keep their interiors fashionable. These owners are typically part of an aging demographic who view rooms as spaces of utility rather than settings for personal expression (not to say they don't express themselves through their furniture, art, knick knacks and personal mementoes, keeping in mind there are many ways we reflect who we are in our residences independent of renovating, as I share in Chapters of Life: The Value of ‘Home’). But for a larger (and younger) demographic, we see our shelter as an extension of our identities and a canvas for reconstruction. Our homes are symbols of ourselves, which I've written about this in the past in Behold The HGTV Effect On Toronto Real Estate and The Psychology Of Real Estate, Housing & Home.
All that to say that my Buyers did indeed consider some of the wrecks. They got very close to bidding on a handful of dwellings which required extensive work (knob and tube wiring, asbestos, moisture issues, failing foundations and full-on decrepit) but they never pulled the trigger, which was the right thing for them to do. This couple reconciled during their search where they landed on the property continuum regarding Move-in Ready Or Fixer Upper? What’s Your Housing Match?, such that they knew they wanted to continue channeling their energies into 'living' rather than 'renovating' a house from top to bottom. In fact - as their search unfolded - they were more likely to be seduced by the turn-key highly-stylized staged reno's which, incidentally, are the houses most likely to attract significant bidders and spike in price. Why? Because there are more buyers willing to pay top dollar and put all the money into the down payment and as little as possible into maintenance and repair, or at least pay the premium to delay maintenance and repair for around 5 years when their earning power will have improved.
With respect to location, these buyers were renting an apartment near Yonge & St. Clair West, and were open to both east and west end, with a preference to the west as far as The Junction, which was close to her family. They had friends on the east side and said they'd consider going as far east to Coxwell, but with an initial budget of up to $1mil the conversation had to include their willingness to locate as far east as Victoria Park. That $1mil budget did increase, which isn't unusual for every Buyer who starts out at their ideal price point but quickly reassesses as part of their learning curve that you have to spend every cent you have to ensure you can purchase a dwelling which offers at least 70 per cent of what you desire. If your budget is, say $1.2mil along the bloor subway line from Victoria Park west to Jane, every subway stop will have a $1,2mil listing for you to consider, but what it is will be radically different in age and/or condition.
Here are three blogs which documented the challenging climate for Buyers of downtown real estate from January through April of 2018.
These Buyers seriously considered, vetted - and even executed their own presale home inspection - on 15 property contenders from a total of around 60 listings which came to market during their 100 day search. Of those 15 dwellings, they proceeded to submit offers on 7 of them until they secured their purchase.
Below is a chart summarizing the seven properties my Buyers pursued, before succesfully securing 'the one'. You'll see they cast the net quite wide in terms of geography - with the seven neighbourhoods spanning from Woodbine to The Junction from east to west. These 3 and 4bed houses were listed anywhere from $749,000 to $1,099,000 - ranged from upgraded to renovated - and all but one (which was taken off the market) sold in competition using the holdback offer strategy where offers were received anywhere from 5 to 9 days after the date they came to market. Having final sale prices from $920,000 to $1,270,000, these listings garnered anywhere from 16 to 35 per cent over their asking prices (averaging 25 per cent over list). And, to give you a sobering reality check on how intense the Spring market was, these 7 properties received a total of 64 offers between them on their holdback offer dates - ranging anywhere from 3 to 17 bids per property!
It was this detached 3bed house built in 1923 near Coxwell and Gerrard which ultimately became our Buyers Home Sweet Home. The property had been in the same family for 90 years - in fact the last owner in the family was born in the house - and it had had just two owners prior to this coming to MLS. The second owners - a couple who were friends of the original owner - were relocating to the west coast. During their ownership they renovated the second floor washroom, ensured all the aging major building components were upgraded, and they refreshed the entire dwelling with fresh paint. The well-proportioned original space plan retained its character features, the high dry basement was spotless, and the efficient utilitarian kitchen was inoffensive, serviceable and offered a future opportunity to make it their own. In other words, it was as close to their original desire for a house which was in good condition but ready to tailor to suit. Yup, these Buyers secured that rare unicorn!
Here are some photos from MLS of the property:
Congrats to our Buyers! Listed for $975,000, this house was purchased for $1,175,120 in a bidding war against two other parties!
This buy was one of three sales I secured within 90 minutes of each other during one April day, with the other two dwellings also located off of Coxwell Avenue just north of this property (thank goodness!). If you're considering purchasing a property in the Coxwell/Gerrard or Coxwell/Danforth neighbourhoods you may want to check out the other two sales - one being a detached bungalow featured in my July 2018 - Home Of The Month - Danforth Village and this listing I represented called a Terrific Townhome On Bastedo Avenue.
Are you considering a real estate purchase? Here's a step by step summary of how I analyze listings of merit for my clients, including the preparation and delivery of our comprehensive due diligence packages for every property our Buyers indentify as a possibility.
Serving first, second and multi-time Buyers, young families, down-scaling Zoomers, renovators and those building their investment property portfolios, our mandate is to help our clients strategically secure the best real estate on offer, while ensuring their purchase best serves their practical needs and their dream of 'Home'. We identify a property's best qualities, features and insouciant charm in the context of the future target market while meeting your own wishes, wants and desires.
Curious to see what the Urbaneer Team sells? Here's Toronto’s Best Houses & Condos Of 2017 By Urbaneer, which showcases our expertise across the original City of Toronto!
Are you exploring the possibility of purchasing Toronto real estate? Here's some of my most popular blogs
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Steven Fudge, Sales Representative
& The Innovative Urbaneer Team
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