The average price of a detached house in Toronto jumped to $1.28-million last month.Fred Lum/The Globe and Mail
Aspiring buyers in Toronto's real estate market in May were contending with prices about 15 per cent higher than they were last year at this time.
No wonder bidding war fatigue is beginning to permeate the market.
Some agents and buyers are wilting, Richard Silver of Sotheby's International Realty Canada says.
"Multiple offers seem to be lessening – not due to lack of interest but due to a lack of desire to compete and push the price too high," he says.
According to the Toronto Real Estate Board, the average price jumped to $751,908 in the Greater Toronto Area in May to mark a 15.7-per-cent increase from the same period last year. Throughout the spring market, prices were inflated as the increasing amounts above asking seemed to swell each week.
In one jaw-dropping example, an east-end semi-detached, recently listed for $799,000, sold for more than $1.1-million after the buyer offered a premium of $313,212.
The average price of a detached house in the 416 area code jumped to $1.28-million last month.
Sales swelled 10.6 per cent to mark a record for the month of May. Listings, meanwhile, sank 6.4 per cent in May compared with May of 2015.
While some potential buyers are worn down, others are changing tactics.
Shawn Lackie of Coldwell Banker R.M.R. Real Estate says the game is changing on a regular basis. He recommends that buyers who expect they'll face competition on offer night might try being first at the table instead of the last.
Many agents aim to be the last in because they want to suss out the number of rivals first. Often, they will tack more onto the offer with each additional party in the lineup.
Mr. Lackie, who works mainly east of the city in the Durham Region, says one agent in his office recently switched things up by jumping in immediately instead of waiting until the last minute after her clients lost out on eight bidding wars.
Mr. Lackie says he advises that strategy because it allows the agent to develop a rapport with the listing agent.
"They are thankful to you because now they have at least that initial offer that should start the ball rolling."
Mr. Lackie adds that agents should always present an offer in person, if possible, instead of e-mailing, faxing or dropping off a written offer at the listing agent's office.
He says presenting the bid in person gives the buyer's agent a chance to push for their best interests. It also allows the agent to figure out how things are going from the listing agent's demeanour and body language.
Julie Kinnear, an agent with Keller Williams Neighbourhood, also recommends trying to build a connection with a seller.
One way potential buyers can do that is to attach a bank draft for the down payment. A bank draft is more secure and therefore may put the seller's mind at ease.
A buyer who is going to be using financing for the purchase might have a mortgage provider send out an appraiser before the offer date.
Ms. Kinnear adds that bidders who include a personal note about themselves are often successful in winning over the sellers.
In her experience, eight out of 10 times, the buyers who included something personal about themselves with the offer were the triumphant bidders.
Carolyn Ireland