Rachel Sa – Canada​.com

Here’s a lil’ tip for you, Toronto home­buy­ers: Want to stop bid­ding wars in this city? Don’t get into one.

Sure, that may be more eas­ily said than done, espe­cially when you’ve checked out a pos­si­ble new home and gone all googly-eyed over the gran­ite coun­ter­tops or the orig­i­nal wood trim or, that rarest of all Toronto real estate finds, the backyard.

Com­ment: But that makes no sense. If you want – or need – a house, you have no choice. List­ings are so low, sup­ply is VERY low right now. Unless you buy a crappy house in a crappy neigh­bour­hood, you are likely to have to com­pete for a house. It is just the way the mar­ket is. Unless we get 1,000 new sell­ers tomor­row, it is going to stay like this for a long time yet.

But the Real Estate Coun­cil of Ontario (RECO) tells The Star that about 30% of the 15,000 inquiries RECO received this year were from house hunters frus­trated by bid­ding wars.

Com­ment: Because it is human nature to com­plain when we do not get what we want.

Not only do bid­ding wars drive up the cost of home own­er­ship, they often force buy­ers to pay more for less. Some­times, a LOT less. RECO has actu­ally launched tran­sit ads and a YouTube video warn­ing peo­ple not to skip the ever-important home inspec­tion just for the sake of win­ning a bid­ding war.

Com­ment: No, no one FORCES any­one to do any­thing. Peo­ple make their own deci­sions. Some­times they are not the best deci­sions. But no one forces them to do anything.

That’s right – Toron­to­ni­ans are actu­ally sign­ing on the dot­ted line for the biggest pur­chase of their lives with­out con­firm­ing that their “dream” home could use a new roof, a new fur­nace or be on the verge of col­lapse. ‘Cause you know that makes a tonne of sense, say­ing to the seller: I’ll pay you MORE for a house which could very well be worth less. I’m will­ing to take that gamble!

Com­ment: Blame that on list­ing agents, they want “clean” offers with no con­di­tions. That ben­e­fits no one. With­out a finance con­di­tion, the bank could say no to the buyer on clos­ing – which means the seller has to put their house back on the mar­ket months after it first sold. If they have bought… ooh, not good. And with­out an inspec­tion, an angry buyer could sell when defects are found later. Let it sim­ply be about price and clos­ing date, let’s leave the con­di­tions in – the pro­tect EVERYONE.

Stop gam­bling, Toronto, and think of the rest of us. When you allow your­self to be sucked into a bid­ding war, you keep the bid­ding wars alive. Don’t feed the beast.

Com­ment: But it is sim­ply not that easy. Many peo­ple want to live in cer­tain areas, more than the houses that are avail­able. Thus, they have to com­pete for these houses. Do you really expect that many peo­ple to just stop look­ing for a house? What hap­pens when they all start look­ing again? Same prob­lem. Are you going to come with a time table, so only cer­tain peo­ple are allowed to buy this month and oth­ers next month? It is all fine and dandy for you to tell every­one to stop, but it sim­ply is not prac­ti­cal. And to be hon­est, a good half of my clients avoid bid­ding wars, they just stay away from them. I expect that is the same with other agents. So that means a ton of peo­ple are already stay­ing out of the bid­ding fren­zies! What you see are those who really really want those houses.

In the mean­time, check out the cau­tion­ary video from RECO, com­plete a mourn­ful piano sound­track and a sad-eyed, pouty-mouthed child suf­fer­ing the fall­out of a hasty home pur­chase. Look at that kid’s face – and back down from the bid­ding war.

And, take a look at the stats on the hot Toronto hous­ing mar­ket.

Com­ment: But what do the stats show? Only that prices rise, year over year. So buy­ing now means your house will be worth more in the future. That does not really sup­port your argu­ment. Peo­ple, list your homes! That is the only way to stop the mad­ness. As much sense as that makes…

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Con­tact the Jef­frey Team for more infor­ma­tion – 416−388−1960

Lau­rin & Natalie Jef­frey are Toronto Real­tors with Cen­tury 21 Regal Realty.
They did not write these arti­cles, they just repro­duce them here for peo­ple
who are inter­ested in Toronto real estate. They do not work for any builders.
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