Posted 3.12.14 @ 8:35
A strange question, indeed - but according to a recent BMO survey over a third of Canadians (and almost half of shoppers in the GTA!) are more than willing to get into a bidding war if it means getting the right home. With so many people entering the process ready to fight tooth and nail, it can make the whole process a bit intimidating, right?
The same survey was conducted in 2013, with slightly different results. Only 21% of prospective shoppers in the GTA were prepared to fight to secure a property (about 20% of all Canadians gave the same response in last year’s survey). So what’s changed? Why so aggressive? Is it really worth it to get into a bidding war? Are the expectations for smooth sailing unrealistic at this point?
The Market Has Changed
The first thing we have to understand is that the market has changed this year. While home sales are dipping, home prices are quickly rising, especially in the GTA. That means with fewer “choice” homes available, people are willing to spend more to secure the prime property they want to buy.
While a drop in sales is usually the hallmark of the beginnings of a buyer’s market, in this case it just means there are fewer homes available (or fewer homes that you would want to buy). In Toronto it’s culminated in a fever pitch with a dilapidated home in Roncesvalles Village going for over $800,000, a home that’s going to need half of that in renovations.
Average Homebuyer Visits 10 Houses Before They Buy
But for most of us, we can afford to be a bit pickier than buying down rundown homes. The same BMO survey showed that the average homebuyer visits 9.5 homes before they move to bid, with about half (49%) winning the first home they bid on, and 44% winning the second home they go after. That leaves an unfortunate 7% of buyers bidding on a third, fourth or even fifth home.
Then again they didn’t have the Goodale Miller team on their side to help them win a home - but you will, if you give us a call. Another interesting tidbit from the survey was that while over a third of buyers were willing to enter into a bidding war (and 44% of us in the GTA), most of the successful bids (85%) worked with a realtor or property specialist.
Buyers Can Afford to be More Aggressive This Year
Canadian incomes across the board rose by 10% in the last 3 months of 2013, so Canadians can afford to spend a little more on a home than they could even six months ago. This means that not only do they want to get into a bidding war, they can afford to get into a bidding war.
Great news for sellers, but not the best news for buyers. That’s why it’s so important to have the right team on your side when you buy a home! We here at the Goodale Miller Team have lived, worked and loved Oakville for years and we understand the ins and outs of the market here. If you want to buy or sell, you want to work with us. Give us a call today and see what we can do for you.
You can also view some of our great luxury homes for sale in Oakville and the surrounding areas here: http://www.goodalemillerteam.com/Homes.aspx