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Buyer Diaries: Toronto

  • It's not complicated. 1. Sell your home now for as much as you can. 2. Rent a modest property. 3. Invest in gold and silver as well as inflation protected assets, i.e dividend stocks....4. Watch house prices plummit in the next 3 to 18 months. 5. Purchase your dream house while others are dumping theirs for peanuts as there'll be no credit available out there to save them - the banks are all going bust !!
  • I appreciate the point of view Massive. I do. I'm definitely not rushing to buy, but after 10 years in this home we have an idea of what does and does not work for us. When the right home arrives we will go for it. Obviously it would be nice to time everything but that isn't always possible. In all honesty, I was raised under the guidance you are offering. Seriously, every month my father would tell me the new signs that the economy was about to collapse. That view has been there for my whole life. Even 10 years ago I was told I was insane to buy, there was a crash right around the corner. I am not sitting here suggesting there won't be a correction. Nor am I forecasting the end of the world economy either. What I want is the right home for us. It will be our home for a long time. If, in that period of time it becomes less valuable it may not be that big an issue since we will be in it for the long haul -- not as a short term investment. Everyone has to understand their own situation and be comfortable with their decisions. Certainly not everyone is going to be comfortable with looking at houses in this market -- but it's not like I've actually bought yet either.
  • Yeah... when you're looking at your primary residence, that seems like the right attitude to have. Back when I bought 7 years or so ago, we were looking at how low interest rates were and expecting that as soon as they started to rise, house prices would plummet. BUT... we wanted a house and knew we'd be in it for the long haul, so we went ahead and bought. If you're an investor or speculator, then this is a bigger issue. If you're looking for a place to live... well... then you just need to be able to afford what you're paying. What's it's worth afterward isn't much concern.
  • Thanks, Wild Weasel. I think you summed it up nicely.
  • I just wanted to let readers know that Carl is now an international sensation. :-) A Buffalo business website is talking about his blog.
  • The Globe and Mail recently reported that 75% of Canadians would walk away from a bidding war over a house. Sadly, it feels like the other 25% happen to be looking in the same Toronto neighbourhoods we are.
    Our preference is East York: anywhere from The Beach to Riverdale and as far north as O'Connor. In reality that covers a lot of ground and a number of different neighbourhoods. So how hard can it be finding a house in the $650,000 to $750, 000 range? Apparently it's a challenge. Three weeks ago we thought we had found 'the one' --a three bedroom, 14 year old rebuild nearby that was listed at $749,000. When the dust settled the home had sold for $140,000 over asking and it hadn't been sold to us. Bidding wars, it seems, are the norm for now. I'm open to the concept, but I know my limits. To me it's no different than walking into a casino. I know exactly how much of my money I'm really willing to part with and will walk away after that no matter how tempting it is to stay.
  • That's some crazy stuff to do with knob and tube

  • As hot as the market may be right now, I can't say there was a lot of depth available this weekend. That may help to explain why people bid when they see something they really like. We have typically looked at two story detached houses, this weekend I've branched out to look at bungalows that could have a second floor added. These kinds of properties are fairly common in East York but even they seem to have an entry level of $500,000. In this weekend's case there was no effort to offer the house as anything more than a tear down. In the picture above you can not only see the wiring is a mix of new with knob and tube, but that it's also perhaps a little questionable. No efforts to hide it. This $500,000-ish house is really just being marketed for the lot and a couple of foundation walls. In the end the yard was a significant factor that made us decide to keep looking. A big part of the backyard was occupied by two very new and very large sheds. These outbuildings had new cement pads poured for them which would make demolition and removal a real pain. I need a shed. I don't need two and we would rather have the green space -- particularly if we are expanding the existing home.
  • A part of our morning routines each day is to review our 'property matches' email from our agent. He has set us up to receive an automatic email each day showing all of the new (or changed) listings in our preferred neighbourhoods and price point. We like it because items appear there before they appear on the realtor web site. Mondays are typically slow when it comes to new listings and today is no exception. The email is showing only two properties, one of which is a price change. Both are semis and that isn't the kind of house we are looking for. Tomorrow should offer more potential. Tuesday mornings are often the busiest of the week for new listings. As our agent once explained, most of them work all weekend and prefer to take Monday off. Tuesday often marks the start of their work week.
  • Tuesday morning. Remember how I said this has often been the busiest day of the week for new listings? Not today. There's one and it's a townhouse. Maybe tomorrow...
  • A busy day today of looking at this week's selections. First up is a picture of a 9 year old's 3 michelin star back yard. While this house wasn't right for us on a few fronts, my daughter loved the yard: The ramp was a pirate ship plank and the "second" yard behind the fence. It was a playground paradise for her. The house had been reno'ed with accessibility in mind. While there will be home buyers looking for those features, we aren't them. I hope the right buyer finds this place rather than someone just pulling it all out. FYI, the accessible semi was a bit under $600K
  • Despite my claims of not wanting a semi, we still looked at one today. It was closer to the subway and there's a great ice cream shop blocks away. But it still wasn't enough to sway our belief that we are firmly planted in the detached world. (That was an intentional gift for those making comments).
  • The semi yard garnered a half michelin star from the nine year old. I was quite fond of the brick if I would be allowed to decorate it. But decorating the side of someone else's house is often taboo.

  • Pirate planks and second yards. 3 michelin stars to a kid.

  • I do have a confession. The first thing I go looking for in the house is the electrical panel. It can tell you a lot. It can tell you some real, tangible things and it can give clues about how much care has gone into the parts you can't see. I visited two new builds above my stated range today. We were most interested in getting ideas to do our own reno. The million dollar+ reno had 100 amp service -- and only one free slot on the panel. That's way to little for a brand new build and in my own opinion, way too cheap for a million dollar house. (Don't worry, I wasn't going to to try to buy it). I'm left to wonder, if they cut corners on the service panel I can see, what other corners may have been cut.
  • This was not the million dollar+ home. But is was a new build above our range. I can't help but think the spray foam insulation went in after the electrical inspection. That's sloppy at best. Anthony Bourdain once suggested a restaurant's washroom tells him quite a bit. If they will let you see a really badly cared for washroom, how bad are the places you can't see? I take the same line of thought into new builds and reno's. If they let you see this, what do the parts you can't see look like? This workmanship gem will run you closer to $900K.

  • We did stop to look at one other bungalow this weekend. It caught our eye because it was priced over $100K more than the typical tear down bungalows around here. At the price we thought it might be a renovated house that might be worth considering. It wasn't. It was something you would want to gut and redo. Time will tell if they get the $600K+ they are asking. Personally, I can't fathom it, but that doesn't mean that someone out there won't pay it. If this is the thin edge of the wedge then a crazy market just got worse. I don't think it is though. I don't know the stats, but I really don't think everything is going to bidding. I think there is limited quality out there and when it arrives it garners a lot of interest and bids. Even though I'm an amateur I don't see the magic combination in this property.
  • Toronto housing prices are out of control. If I were living there right now I would rent and wait for the inevitable correction before buying.
  • Yikes, that spray foam photo looks like an FX shot from "Aliens"! Not confidence-inspiring and a pain in the butt if you needed to get at the wiring underneath... And that other place? Our 1100 sq. ft. postwar house has a 100 amp panel. Fine for a couple of energy miser hippies like us but not enough for a bigger home.
  • I've seen a couple of comments reasonably asking why we aren't looking at the burbs. There are a few reasons they aren't on our radar. 1. While people have noted that I work from home everyone has missed the wife part. She doesn't work from home. She has her own career in the heart of the city. 2. We are a one car family. If I moved to the burbs I'd have to buy two and when you add the cost of another vehicle each year I think I'm better spending that $ on real estate. 3. I have actually lived in the burbs and genuinely didn't enjoy it. 4. Lastly, is my daughter: Her sport of choice is exceedingly limited in the suburbs and the only one that could offer a complete training package is probably just as expensive as buying in Toronto. Of course, there are side concerns. My wife would like to see more of our daughter, not less. A daily commute is going to make a big hit on family time. So, while the burbs will work for many people, they aren't on our radar.
  • Wyldbill. Conceptually I understand where you are coming from. My problem is trying to decide how soon and how big the correction is. It's too much crystal ball gazing for me. I tend to buy into Rob Carrick's view today that suggested that is a pretty risky move for a younger family if they already own their house. What I'm saying is that isn't terrible advice, I'm just not sure in my scenario it is financially less risky. Sort of a case by case thing I think.
  • I'm in Leaside and have friends looking in the area. One observation is the market has more demand than supply Feb-early May resulting in many bidding wars. As May unfolds we are starting to see more houses on the market longer and in some cases price cuts in the asking price. So on the one hand an family can get a better price when buying in June to Aug for example but also receive a lower price when selling your place. I suppose Ideal is to sell in Feb and buy in June but let's face it - it's our home not just an investment so there are more intrinsic values that come into play.
  • Do you absolutely need to move now? If you aren't yet sure what you'll need in terms of aging parents, it might be better to stay where you are and rearrange/declutter your way to a better fit...
  • I think Chuckles has a very good point. Supply and demand have a lot to do with it and right now there seems to be a lot more supply. Personally, I would never have an issue with selling in a buyers' market when housing prices are lower. The delta to move up also gets smaller. I'm certainly seeing houses stick around longer on the market but I have no real stats to back up that observation.
  • To answer K: This house was supposed to be our starter for the first 5 years. We are nearly at 10 now and my wife has really had enough of dealing with the shortcomings that made this a starter house. We have been looking for a while and are taking our time to find what we feel is the 'right' house. Our primary concern with our house is the noise/specific street. Those are things we can't address with a reno or rearrangement.
  • Another weekend has come and gone. This is the second week in a row that nothing has even caught our eye enough to go and look at. It's not like there is a shortage of available houses out there, they're really just not that appealing. Things seem to be cooling off (thankfully), but I wonder if the lack of depth available has something to do with that.
  • Beware of the "wait to buy, rent instead, reap the benefits of a crash". Many a buyer in today's market heeded that advice in 2007, 2009, or 2011 to no avail. If you are purchasing a single-family home for your own main residence, have a sizeable downpayment and secure income, you most likely will be fine.
  • There was a rare week night open house nearby last night. A nice enough little bungalow. Electricity was updated -- and the panel job looked so much nicer than that last monster I put up ;). The "bones" of the house appeared to be in good shape. I've asked my wife to look at it on the weekend. While she would still want to top it up it could certainly lived be lived in too.
  • Remember that &600K+ bungalow that I couldn't see the value in? It sold. Not in the first week, but it sold. I'm curious to hear what it finally went for. I'm hearing of fewer bidding wars but the prices seem like they are still going up. Even as an existing home owner this market is getting harder and harder to move up in. I'm not looking for a palace, I just want to address the deficiencies of the current location.
  • As this month of house hunting and blogging draws to a close I'm more grateful than ever for two luxuries we have: time and a few hundred thousand dollars to put down. I don't envy my fellow bloggers who are trying to get started in the own-your-own-home game.
    Housing prices around here still look like they are going up, albeit a little slower. I think the perception of it slowing down has more do with a large supply than anything. Quality opportunities still go to bidding. I'll keep looking, but with the schedule getting bogged down, the house hunt will be a lower priority this summer.
    This last month has been an interesting opportunity to gather a lot of advice -- both solicited and unsolicited ;). The advice more or less reinforced my belief that a long term house for a family is a very different beast than an investment property. The two certainly require two different mindsets about when you should move and what risk you can live with. At the same time the size of your downpayment has a huge impact on being able to ride out the leaner times. Everybody has to find the level of risk they are comfortable with. Ideally they are honest with themselves when they arrive at that value. Knowing all of the numbers in my life I'm pretty comfortable that we can do the price range we discussed. Of course though, I'd be happiest if we found something at the lower end of that range.
    Thanks for taking the time to read!
  • You should seriously look at more semis. The 80+ year old semis usually have double brick between the houses. I lived in one for 15 years near Pape and Danforth and never once heard our neighbours
  • Carl, are you finding many buyers want offers unconditional on sale of your existing home? We are in a similar boat (looking for a larger home for our growing family) and I am finding that in my city, sellers simply will not take an offer contingent on sale of your existing home, which makes pulling out equity for a CMHC-insurance-free down payment impossible.
  • I landed on this article/blog when I saw a smidge of an RLP sign, firing up my curiousity. To Carl I say you are a wise shopper who doesn't appear to be motivated by greed. My theory is when you carry humility and gratitude in your tool belt with a huge buckle of patience - you'll end up a winner at the end of it. We aren't seeing a bubble or any peculiarities in the market - we typically have periods that slow down a wee bit and usually that decline in speed comes from exhaustion. We had a strong Spring market that came on the heels of a hectic Fall session that ran through the Christmas season. There are buyers out there who won't sell until they buy - the old Catch 22 because so many have that in mind - there isn't much good inventory available. With hot temperatures outside, folks are getting into a cottage and holiday mentality which contributes to the pace or lack thereof. Hold onto your hats and purse strings because the Toronto market doesn't give any fair warning: you wake up and there is a glut of good stuff out there and the race begins. As long as you are prepared, have a good professional team on your side and trust your own instincts (because you understand your needs) - that home will find/wait for you. Good luck.
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