The Weekend That Was…


5 minute read

January 11, 2010

NOT the best weekend if you are a real estate agent working with buyers, or a buyer yourself…

I had two experiences back-to-back that demonstrated how quickly the “spring market” has taken off this year.

All this, and I have to remind myself we’re only in the first week back after the New Year…


Two days, two stories, and they both don’t help to put things in a positive light if you’re a buyer.

Many of us believed that the “spring market” or the 2010 market would be slow-going at the onset, but my experiences this weekend lead me to believe otherwise.

Maybe these are two isolated examples, but the early indication is: there is still a lack of product on the market, and the buyers are starving.

Here are my two stories…

“Three Hours And GONE”

Friday is generally a slow day in real estate.  There aren’t a lot of new listings to speak of, since most new listings come out on Tuesday, Wednesday, or Thursday.

On Friday afternoon I was sitting at my desk enjoying a fresh Tim Horton’s brew, and I noticed a new listing at 230 King Street, which in addition to being the main target for three of my buyer-clients, is also my home.

“Who brings out a new listing at 3:30PM on a Friday,” I asked aloud as a colleague of mine was looking at the exact same condo on his computer.

“I don’t know, but I’ll tell ya something – I’m gonna sell this condo,” he said.

We argued over who would sell it first, somewhat jokingly of course but we both had 3-4 clients for the property so we were both rushing to get our clients in the door.

Then I realized that this listing differed from about 95% of all the other condos in this price range currently listed in the downtown core: there was no hold-back date on offers.

Priced at $279,000, the unit fell right in that “first time buyer” price range where you’d expect to see a hold-back on offers, and then anywhere from one to a dozen offers on “offer night.”  But this seller and agent elected to list it without the hold-back, and I knew that the property wouldn’t last the weekend.

I had arranged to take one of my buyers to see the unit at 11AM on Saturday, and another at 5:30PM that day.

By 10:00AM on Saturday morning, I received a page from my office that in the back of my mind, I knew might be coming: “CANCELLATION 230 KING, PROPERTY SOLD FIRM.”

The property likely sold to the first person through the door, and why not?  It was under-priced in my opinion, and I think they could have got $300,000 for it if they held back offers.

I’m guessing that the buyer of this property is quite savvy or has a savvy agent, and they recognized that the listing agent and the seller were completely outclassed.  They probably had a full-priced offer printed and ready to sign as soon as they walked in the door, and I bet they were inside the unit for less than sixty seconds before the buyer said, “Yep, this is it.”

Contrast this with a quote from my colleague’s client, who when asked to view the unit by my colleague, said, “Not this weekend….it’s too cold outside!”

That’s a great lesson in how not to be successful in a tough market place!  It’s too cold outside.  Really?  If you aren’t willing to put on a coat and venture out for an hour, how the hell are you going to find the gap in this seller’s market?

The buyer of this condo struck while the iron was hot, and then conversely, you’ve got buyers like those of my colleague who are too lazy to leave their own home.

If I had it to do over, I would have insisted that my clients meet me at the property at 5PM on Friday.  As much as I’d like to say, “How was I supposed to know it would sell in three hours?”  Part of me knew that it would…

“Party Of Five”

On Saturday afternoon, I took a client to see a few condos in the King West area.  My client is looking primarily for a townhouse in Liberty Village, but since there isn’t a lot of activity in that segment of the market, we decided to look at what else is available.

We met at 1029 King Street, aka “Electra Lofts” at 2:00PM and it was a madhouse.

I parked on Douro Street behind the building, and I could see a throng of people trying to get in through the back door of the building.

I walked around to the front entrance, and through the glass door I could see about a dozen people standing and waiting.

I already knew what would happen from here on out, and I knew I’d be writing this on my blog…

I walked inside and there were four agents waiting for their clients, and three clients waiting for their agents; none of which were waiting for eachother.

The listing agent’s business partner was standing there with an “OPEN HOUSE” sign and was completely bewildered by what was going on.  The poor guy didn’t know which end was up, and he just stood there with a sheepish grin as people filed past him to get to the elevator.

I made chit-chat with the other agents, and when their clients arrived they went into agent-mode and began their sales pitches.

Over the ten minutes while I waited for my client, the waiting-buyers found their agents, and the waiting-agents met up with their buyers.

When John walked inside I said, “Buddy, this is going to be quite an experience.  Just smile, and absorb everything that’s going on.”  John is a smart guy, and he knew right away that he’d never get involved with a frenzy like this.

We went upstairs and there were people literally lining the hallway waiting to get into the unit.

We took our shoes off and left them with the other 10-12 pairs in the hall, and stood idly by while the listing agent poked her head out the door periodically to ask, “How many are you?”

As much as I try to escape the velvet-rope phenomenon, be it at a nightclub or at a condominium, I always find myself waiting to be let through the door!

A group ahead of us said, “We’re four,” and the listing agent said, “I’m sorry, I can only take two right now, you’ll have to wait.”

John and I laughed at the insanity, but we were there to see the condo so we had no problem waiting.

I joked around, being the clown that I am, and said, “Salinger, party of five,” when the listing agent asked us how many we were.  I guess she wasn’t a fan of the TV show, but then she probably wasn’t in love with Neve Campbell like I was…

Once inside the condo, we could barely move.  There were about 20 people mulling about in the 950 square foot unit, and another twenty waiting in the hallway outside.

The condo was very average, and nothing special.  I had been in this same model unit about ten times before, and at a different time and in a different place, nobody would get excited about this unit.

I tried to film a short video for my blog, showing all the people lined up like cattle to get inside the unit, but I didn’t feel comfortable filming a bunch of strangers and sharing it with the world.

You’ll have to take my word for it – this “average” condo probably had 200+ people through the door on Saturday, and who even knows about Sunday.

The January market has certainly started with a bang, and while the sellers seem to be waiting for late January to list as is the usual custom, the buyers that carried over from 2009 aren’t wasting any time…

Written By David Fleming

David Fleming is the author of Toronto Realty Blog, founded in 2007. He combined his passion for writing and real estate to create a space for honest information and two-way communication in a complex and dynamic market. David is a licensed Broker and the Broker of Record for Bosley – Toronto Realty Group

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  1. LC

    at 2:33 pm

    I used to be bearish on the downtown market, but I was proven wrong every year. It will be interesting to see how high the first quarter of ’10 goes in price per SF before the implemetation of the HST and whatever interest rate increases the government decides to throw at us. But I don’t believe either factors will have a crippling impact on demand, as long as supply remains relatively short.

  2. WEB

    at 11:51 pm

    The macro factors and sentiments are worrying:

    – ratio of property values to incomes is 5X vs. historical average of 3X
    – people are looking at real estate as an investment instead of a place to live AND everyone thinks real estate is a good investment and can never fall (usually the sign of a top in any market.)

    But, what bears don’t consider is the many very positive micro factors relating to Toronto real estate:

    – The GTA is the second fastest growing metropolitan area in North America
    – The GTA is land-locked by Lake Ontario to the south and increasing restrictions on development to the north.

    Positive micro factors relating to downtown Toronto:
    – gridlock is getting worse every year
    – hours worked continues to increase which makes time away from work more valuable and thus the value of a short communte rises
    – downtown Toronto is fast becoming an amazing place to live- neighbourhoods are rapidly gentrifying, new neighbourhoods are being created (Distillery, West Donlands, East Bayfront), the waterfront is being revitalized, new attractions are being added (aquarium, ROM and AGO renovations, etc.), 5-star hotels and condos are being built, neighbourhoods are being connected (St. Lawrence market connected to Distillery, connected to West Don Lands, connected to Corktown, connected to Riveside, connected to Leslieville, connected to the Beaches- the same is happening in the west), trails and parks expanded (Lake Ontario Park, waterfront trails), new retail is being built (supermarkets, etc.), more and better restaurants being opened, etc, etc.

    How do the macro negatives and micro positives play out? Real estate in Toronto is expensive and appears and feels overvalued but I feel that prices may be somewhat justified due to the positive micro factors I mentioned.

  3. LM

    at 5:36 pm

    Mark Carney fuelling the fire… BOC saying house prices/ rates are at an appropriate level… party on 🙂

  4. Meh

    at 6:37 pm

    Being able to justify the price doesn’t matter though. The price of a Porsche may be justified, but that doesn’t mean people will go out buy it. People buy what they can afford, not what the justified price of a product dictates.

    Real estate bulls always forget how abundant rentals are in Toronto. People need shelter, but they don’t’ need to own that shelter.

    In the long run housing prices can only match wage increases. Until high paying jobs start increasing (or general wages increase), housing prices will hit a ceiling.

    On the topic of down payment. People will

Pick5 is a weekly series comparing and analyzing five residential properties based on price, style, location, and neighbourhood.

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