Red-hot bidding wars driving home buyers to rush their offers, local agents say
The pursuit for housing space in Toronto has led to some home buyers actually making offers without even getting inspections, according to local real estate professionals working in the thick of the city’s feverish bidding wars.
“The bottom line is we are in a shortage of supply,” Century 21 Leading Edge Realty Inc. agent Tasis Giannoukakis said, as reported by Bloomberg.
The broker noted that bids of as much as $200,000 above asking price are not unusual, further contributing to the city’s long-running climate of home price growth and desirability.
“That pressure is what’s causing everybody to remove the conditions on an inspection,” Giannoukakis stated. He surmised that the greater accessibility of reliable information via the internet might have made prospective home owners more knowledgeable when it comes to DIY repairs and renovations.
“When you are the only offer on the table, you can submit a conditional offer,” iPro Realty Ltd. agent Lorand Sebestyen said, adding that he warns clients on the dangers of skipping inspections. “But when competing with several other offers, you don’t have that luxury.”
As of February, Toronto-based home-inspection firm Carson Dunlop said that it has experienced a significant 34 per cent year-over-year decline. Meanwhile, Ontario Association of Home Inspectors president and Parish Home Inspections head Murray Parish noted that his firm has suffered a 30 per cent drop in transaction volume.
The numbers came amid news that the average price of a detached home in Toronto increased to $1.21 million in the second month of this year, a development largely fuelled by persistent supply issues.
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