Can Your Neighbours Affect The Value Of Your Home?

They sure can!

But it’s not always in the way you immediately think, ie. the hoarder with eight couches on the lawn, or the crazy person who has covered the entire house in tin-foil to block out the brain-waves.

When looking at “highest and best use” of the property, we often arrive at the highest price somebody would pay for that property as well.

But what if the neighbours were threatening to affect that “highest and best use?”

 

I don’t have a horse in this race.

Nor do I really care about the outcome.

On the one hand, I see a property-owner applying for a minor variance that has probably been approved many times before, and wouldn’t likely produce a noticeable difference once the new home is built.

On the other hand, I see people who live on the street, pay property taxes, and should have a say in what happens on their street, and in their community.

I’m sure everybody reading this could pick a side, if they were so inclined.

But one thing I can’t help but wonder – are we, or should we be, looking at this from the viewpoint of how the potential variance would affect the community as a whole, or from the viewpoint of how the potential variance would affect the next-door neighbour in particular?

The neighbour has not one sign, but two:

PermitRefused2

It will be very interesting to see how this plays out.

Offers are on Tuesday night, and as I write this – 6:30pm, there are only two registered.

This is an awesome builder’s lot, and I have to think that without those signs, there would have been more action.

So in the end, your neighbours can negatively impact the sale price of your home, and they certainly can hijack the sale process from start to finish…

10 Comments

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  1. iwill says:

    Given that it just sold for $1.7M ish, I don’t think the neighbours effected value,

  2. ANewInvestor says:

    well, it’ll be just a tough life if your neighbour next door is doing construction for a new higher larger building / house. imaging the noises dusts and potential security issues when your neighbour next door is a construction site with all sorts of people flowing around

  3. Jeff says:

    Is the house next door a fully redeveloped house? So it was OK for them to buy something that was different from everything else butnif someone else tries they are the devil?

  4. jeff316 says:

    It is extreme to put up signs, and personally I think you have to be prepared in Toronto to have your streets redeveloped around you, but that’s a pretty nice street and I can see how a slew of monster homes could disrupt the look and feel of the place. I think the signs speak to the incredibly hot market we’re in, where buyers snap up properties without much due diligence, often at the word of realtors/developers that may be making generalizations (“oh sure, you’ll be able to redevelop this”) and that the City’s permitting process is sometimes unpredictable, approving things they would have rejected not too long ago. I’d be wary if I were a buyer looking to redevelop the property and be happy that these signs tipped me off to potential problems.

  5. Kyle says:

    I think the signs are going to back-fire on these people. I don’t think the signs will necessarily deter a savvy Developer. They will however deter any sane end user, who would prefer not to live beside overzealous busy bodies.

    A savvy Developer will already have a good sense of what variances he’ll be able to get approval for in that area. For all we know the refused variances mentioned in the signs, could be someone asking to build a 6 storey house, a 10,000 sq ft mansion right up to the lot lines or to subdivide the lot into 3. It likely wasn’t just an application to build a larger 2-storey house, given that there are already lots of large new builds on the street. As well, even if a simple application to build a larger house was refused by the City, doesn’t mean the OMB won’t allow for it.

    1. Marina says:

      Agree. If a developer files to build something similar to what is already on the street (e.g. the house David mentioned that he sold 10 years ago and is now a 2-storey), they will not be refused. Gotta get that second, bigger land transfer tax!

      1. Kyle says:

        Looks like the variances they applied for were for: increased lot coverage, reduced sideyard setbacks and reduced parking width. Nothing to stop a buyer from tweaking those things in the design or appealing at the OMB.

        In fact when you look at the City’s meeting agenda that day, it’s not difficult to imagine that refused applications in Leaside are a daily affair. There was another application on Divadale being reviewed by the City that day and four others (Fleming Cres, Airdrie, Rumsey and Killdeer) that ended up at OMB.

        http://www1.toronto.ca/City%20Of%20Toronto/City%20Planning/Developing%20Toronto/Files/pdf/C/March%2023,%202016.pdf

  6. Marina says:

    Honestly I wouldn’t buy the property because of the neighbors. Do you want to live next to someone who will likely make your life unbearable whenever they don’t like anything about your house?
    I mean, there is a fine line. I’d rather the bylaws deal with that creepy as hell doll house. And if my neighbor wants to paint his house hot pink and build a mini carousel on the front lawn, yeah I’d want that stopped right quick.
    But this is stupid.
    Also i bet when the neighbors try to sell their house, suddenly they will become all progressive and decide building is all fine.

  7. Ed says:

    The neighbours with the signs are pricks. Why not let the sellers get top dollar and then the new owners can worry about getting permits to build, if that’s what they want to do.

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