Sharks are circling around many properties in Toronto right now, as buyers look for deals and try to sense weakness.

They say that sharks can smell blood in the water.

I didn’t know sharks had noses…

Kids are crazy, aren’t they?

When I was a kid, my biggest fear in the world was sharks.  I would go to bed every night, scared to death of sharks.  I would check under my bed, and enlist my sister to pull up my blankets to make sure that there were no Hammer-Heads or Great Whites lurking.

It never occurred to me that not only do sharks need-salt water to survive, but they rarely find their way into a bedroom on the second floor of a house, and then hide their 2000-pound frame under a bed…

As our real estate market has begun the transition into a “buyer’s market,” I find that many buyers out there are letting price dictate if, when, and where they buy.

For example, one of my current listings in North York.

The property is worth about $260,000 (but how can you pin-point a value within a thousand bucks?), and we are consistently fielding offers of $250,000.

We’ve had a verbal offer of $240,000, and two offers on paper of $250,000.

When I try telling the cooperating agents that the property is worth $260,000 because of A, B, and C, they don’t listen.

The sharks are circling around all the properties in this area, and they’re looking for the one weak owner that will go limp and provide an easy kill.

As a buyer’s agent, I would do the same thing.  But as a seller’s agent, I ward off the sharks’ advances, and wait for the “right” buyer.

My friend Greg recently expressed interest in a property near Christie Pitts.  The property was priced at $399,000, and he went into the open house where the listing agent told him, “The owner would probably take $360,000!”

First of all, I can’t believe how quickly that listing agent was ready to royally screw her seller!  Actually, wait….I can…

But after doing some research on the property, I got a sense of just how much weakness was present on the sellers’ part.

Checking Land Registry showed that the property had just recently been transferred from two owners’ names into one.  The owners had been living in the house for almost fifty years, which led me to believe that the husband died, and now the property is in the wife’s name.

But listed under “Seller” on the MLS data sheet was a power-of-attorney!

I concluded that two really old people were living in this house, one of them died, and now the children of the existing owner are selling the house and putting their mother in an old-age home.

Could they possibly demonstrate more weakness?

To the kids, this house represents found money!

They listed the house at $449,000, then $419,000, then $399,000.  The listing agent told Greg that they would take $360,000, which of course means they would probably take $330,000.

Greg asked me if he could offer them $280,000, and I chuckled a little bit.  I told Greg, “We’re not in that kind of market,” and added that I would buy the house if it were available for $320K, let alone $280,000.

But both Greg and I smelled some blood in the water, and there is definitely potential for an outright steal with this house!

In yet another example, my client Julie and I are trying to steal a property from the developer of an un-named condo in downtown Toronto.  The building is home to about 140 units, and the developer has nine left that he didn’t sell during pre-construction or during the subsequent two years.

The nine properties range in price from $259,900 to just under $1,000,000, and I can’t help but wonder how many finger-nails are left on the developer’s hands!  Now is not the time to caught holding three properties of over $800,000!

The building has been registered, and final closing is scheduled for mid-April.

Julie and I decided to test just how weak the developer is by offering $325,000 for a $341,900 unit, while asking for the parking space to be thrown in (a $32,000 value).

The developer looked at his $373,900 property and our $325,000 offer, and signed it back at $365,000.

He clearly wasn’t willing to play ball.

But that doesn’t mean he isn’t as weak as we thought; it just means he is stubborn and is prepared to go down with the ship.

Although our $325,000 offer was obscenely low and probably wasn’t worth the paper it’s printed on, perhaps he would be willing to let ONE of his nine units go for a reasonable price (try $345,000), and then focus on divesting himself of his other EIGHT properties.

How can he convince us that he’s happy holding $5,000,000 worth of property as the building enters final registration?

He can’t, and we know how weak he is.  Whether it is today, tomorrow, or next year, this developer will eventually give in and some lucky shark will get a fantastic deal!

You have to be active to find the deals in our real estate market, and it might take a while to find a weak owner who has fallen on tough financial times and is ready to roll over.

If you happen to be looking in a market or neighborhood where a lot of similar product is available, then you can simply let price dictate which house or condo you end up with.  Somewhere out there is severe weakness just waiting to be exploited.

Again, on the flip side as a seller and a seller’s agent, it’s frustrating to continuously ward off all the low-ball offers from the sharks and/or investors who are looking for a deal.

But welcome to our new market buyers have no shame….nor should they…