Real Estate

Paying $120k over Asking price?

  • Last Updated:
  • Jun 16th, 2022 2:49 pm
Tags:
Deal Fanatic
User avatar
Feb 20, 2015
5280 posts
4940 upvotes
Southern Ontario

Paying $120k over Asking price?

Maybe I'm not used to the game, but it appears even the "cheap" real estate in my city is going apesh!t. Apparently if the house is up for $300k asking, if your offer is lower than $400k, you have no chance as there is so much competition. I've had 2 houses on my block sell in a matter of days. Here's an article on this:

https://www.cbc.ca/news/canada/windsor/ ... -1.5987417

I know the GTA and Vancouver area has always been nuts, but I guess other areas are catching up.

If I sold my house in the attempt to relocate somewhere else, where does $450k buying power stretch the most? Maybe I should hold off until I'm a Millionaire and go buy some fixer uppers in Nova Scotia for rental units? Just thinking out loud, but I was surprised by the news today. A woman was complaining she makes good money in Health Care and moved here, but keeps getting overbid on a house.

So is this bidding way over asking normal in other areas or is it new?
Last edited by Gibsons on Apr 14th, 2021 11:43 pm, edited 1 time in total.
42 replies
Deal Addict
User avatar
Oct 26, 2007
2803 posts
2613 upvotes
YYZ
450k will get you a studio apartment in Toronto
Licensed Full Service Realtor
Deal Fanatic
User avatar
Feb 20, 2015
5280 posts
4940 upvotes
Southern Ontario
bLuPhYrE wrote: 450k will get you a studio apartment in Toronto
I don't live in Toronto and would never want to live there. I'm sure your car costs more than my house.

2 years ago you could get a 3000 sq/ft house for $400k here. Now it's doubled.
Deal Addict
User avatar
Oct 26, 2007
2803 posts
2613 upvotes
YYZ
Gibsons wrote: I don't live in Toronto and would never want to live there. I'm sure your car costs more than my house.

2 years ago you could get a 3000 sq/ft house for $400k here. Now it's doubled.
sorry im very unfamiliar with the market in windsor, but goodluck to you.

im seeing 2000 sq ft detached homes going for 1.4 mil now in Mississauga.
Licensed Full Service Realtor
Sr. Member
Dec 23, 2012
672 posts
532 upvotes
RICHMOND HILL
it isn't just bidding over asking, it's that they set asking to usually much, much lower than even market value (and market value goes up week over week at the moment). it's a trick to get more attention and offers. you want 5-10 or more offers, and people who really want the property to go "oh, so many offers? well I really want it so here's an extra 200k".
Deal Fanatic
User avatar
Feb 20, 2015
5280 posts
4940 upvotes
Southern Ontario
bLuPhYrE wrote: sorry im very unfamiliar with the market in windsor, but goodluck to you.

im seeing 2000 sq ft detached homes going for 1.4 mil now in Mississauga.
How do people afford that? I guess we have a long way to reach that level, but people from other areas are buying here sight unseen.

If someone has a Million dollar mortgage and the interest spikes, what do they do then?
Mosho1 wrote: it isn't just bidding over asking, it's that they set asking to usually much, much lower than even market value (and market value goes up week over week at the moment). it's a trick to get more attention and offers. you want 5-10 or more offers, and people who really want the property to go "oh, so many offers? well I really want it so here's an extra 200k".
Does a buyer or his/her Rep know how many offers have been placed?

Guy in my neighbourhood had a 1000 sq/ft house listed at $380k and the sign went SOLD after a couple days. Granted the area is sought after, but still - pretty small house. I wouldn't call $380K as an undervalued asking.
Deal Fanatic
Dec 11, 2003
8556 posts
1056 upvotes
That chart is so useless. It has no context at all.

But anyways, some people like to start at lower price and see people bid the price up. Just like on eBay, when someone start the auction at 1 cents it didn't mean he will accept 2 cents even if that is the highest bid. Don't join a bidding war if you don't want to.
a
Deal Fanatic
User avatar
Feb 20, 2015
5280 posts
4940 upvotes
Southern Ontario
elty wrote: That chart is so useless. It has no context at all.
The population is growing as people are moving here from other areas... more competition for real estate and they're coming with CASH. After all, sell your house for $2M in TO and come to Windsor/Essex and buy 4 of them (3 for rentals), with money left over.

That's all it's showing up there... It was from CBC.
Deal Addict
User avatar
Oct 26, 2007
2803 posts
2613 upvotes
YYZ
Gibsons wrote: The population is growing as people are moving here from other areas... more competition for real estate and they're coming with CASH.

That's all it's showing up there... It was from CBC.
not hard to sell a toronto detached home for 2 mil and buy a house for 600k cash in the outskirts.
Licensed Full Service Realtor
Deal Fanatic
User avatar
Feb 20, 2015
5280 posts
4940 upvotes
Southern Ontario
bLuPhYrE wrote: not hard to sell a toronto detached home for 2 mil and buy a house for 600k cash in the outskirts.
How far you have to go to get that? I have a buddy up in Bradford and real estate is crazy there too. Don't think $600k buys too much there either.
Sr. Member
Dec 22, 2004
736 posts
981 upvotes
Toronto
Gibsons wrote: How far you have to go to get that? I have a buddy up in Bradford and real estate is crazy there too. Don't think $600k buys too much there either.
I bought a house in Blue Mountain and paid over a million. North Bay maybe?
Deal Fanatic
Dec 11, 2003
8556 posts
1056 upvotes
Gibsons wrote: The population is growing as people are moving here from other areas... more competition for real estate and they're coming with CASH. After all, sell your house for $2M in TO and come to Windsor/Essex and buy 4 of them (3 for rentals), with money left over.

That's all it's showing up there... It was from CBC.
How do you even know the chart is talking about population movement just by looking at it? It could have been number of people, number of family, number of single female, number of landlords, the number of company, the number of racoons ,...

Also, it provides no timeframe. Does it compare between today and yesterday? 2020 to 2019? March to Feb? 2021 March to 2020 March? This decade to the last decade?

Lastly, a 500% increase doesn't tell you much. If there was 1 people moved from Hamilton to Windsor yesterday, and 6 people moved today, then it is a 500% increase. I doubt that will affect the real estate price.

I am not saying you are wrong, I am just saying the person who make this chart is useless. With less than 10 extra words this chart would be much more meaningful.
a
Deal Fanatic
User avatar
Feb 20, 2015
5280 posts
4940 upvotes
Southern Ontario
elty wrote: How do you even know the chart is talking about population movement just by looking at it? It could have been number of people, number of family, number of single female, number of landlords, the number of company, the number of racoons ,...

Also, it provides no timeframe. Does it compare between today and yesterday? 2020 to 2019? March to Feb? 2021 March to 2020 March? This decade to the last decade?

Lastly, a 500% increase doesn't tell you much. If there was 1 people moved from Hamilton to Windsor yesterday, and 6 people moved today, then it is a 500% increase. I doubt that will affect the real estate price.

I am not saying you are wrong, I am just saying the person who make this chart is useless. With less than 10 extra words this chart would be much more meaningful.
I took it out. They are trying to show in a haphazard way that a sh!tload of people are coming from other jurisdictions. It's well known that most of the income properties are owned by people not living here.
Deal Addict
User avatar
Nov 2, 2020
1438 posts
2076 upvotes
Gibsons wrote: I took it out. They are trying to show in a haphazard way that a sh!tload of people are coming from other jurisdictions. It's well known that most of the income properties are owned by people not living here.
You should be happy they are driving up your property value...I don't really understand your question. Average house price in Alberta is 353k. Question is can you move elsewhere or do you have a job that ties you to ontario?
Deal Addict
Jun 18, 2020
4229 posts
5540 upvotes
The move west seems to be a real phenomenon. There's an economist who has spent last little while digging into the details of this.

https://mikepmoffatt.medium.com/

Basically he believes population growth is driving prices, but as well there's a migration effect to these smaller cities. London, Waterloo etc seeing gains as people, as he calls it, drive until they qualify for mortgage.
Deal Fanatic
Mar 15, 2005
6024 posts
1874 upvotes
Gibsons wrote: Maybe I'm not used to the game, but it appears even the "cheap" real estate in my city is going apesh!t. Apparently if the house is up for $300k asking, if your offer is lower than $400k, you have no chance as there is so much competition. I've had 2 houses on my block sell in a matter of days. Here's an article on this:

https://www.cbc.ca/news/canada/windsor/ ... -1.5987417

I know the GTA and Vancouver area has always been nuts, but I guess other areas are catching up.

If I sold my house in the attempt to relocate somewhere else, where does $450k buying power stretch the most? Maybe I should hold off until I'm a Millionaire and go buy some fixer uppers in Nova Scotia for rental units? Just thinking out loud, but I was surprised by the news today. A woman was complaining she makes good money in Health Care and moved here, but keeps getting overbid on a house.

So is this bidding way over asking normal in other areas or is it new?
Why does anybody care about "over asking" price?

In my neighborhood houses keep getting lists at around 999,000 even though every house around here has sold for 1.1-1.3M in the past six months. When it sells I get dozens of flyers like "SOLD 300K OVER ASKING!"

Of course it sold for way over asking, it was under listed on purpose to get the bidding war and the wow factor of "over ask"
Deal Addict
Mar 30, 2017
1226 posts
980 upvotes
GVA
Ziggy007 wrote: Why does anybody care about "over asking" price?

In my neighborhood houses keep getting lists at around 999,000 even though every house around here has sold for 1.1-1.3M in the past six months. When it sells I get dozens of flyers like "SOLD 300K OVER ASKING!"

Of course it sold for way over asking, it was under listed on purpose to get the bidding war and the wow factor of "over ask"
exactly, asking price and over asking mean nothing.
comparing it to assessment is way more meaningful
.
Deal Fanatic
User avatar
Feb 20, 2015
5280 posts
4940 upvotes
Southern Ontario
seatiger wrote: exactly, asking price and over asking mean nothing.
comparing it to assessment is way more meaningful
It can be difficult finding these values when you don't find out the 'final selling price' and the assessments are 1-3 years old (things have doubled or tripled since then).
Member
Nov 26, 2012
433 posts
471 upvotes
Toronto
Gibsons wrote: It can be difficult finding these values when you don't find out the 'final selling price' and the assessments are 1-3 years old (things have doubled or tripled since then).
They mean reviewing comps of similar houses in the area and how much they sold for in the last 3 months (or month in Toronto cuz it's been crazy). List price doesn't mean anything, it's just a marketing strategy. If my house is worth $500k but I list for $300k and sell for $500k, yes I technically got $200k over asking but I didn't actually get more than what it is actually worth. I'm very confused by why people think the list price is the price the seller wants. That's just the opening gambit.
Deal Fanatic
User avatar
Feb 20, 2015
5280 posts
4940 upvotes
Southern Ontario
niche54 wrote: They mean reviewing comps of similar houses in the area and how much they sold for in the last 3 months (or month in Toronto cuz it's been crazy). List price doesn't mean anything, it's just a marketing strategy. If my house is worth $500k but I list for $300k and sell for $500k, yes I technically got $200k over asking but I didn't actually get more than what it is actually worth. I'm very confused by why people think the list price is the price the seller wants. That's just the opening gambit.
How do you acquire how much they sold for? I've asked this several times already and nobody has answered.

Maybe an Agent is privy to that info, not sure a regular Joe has that access.

Top

Thread Information

There is currently 1 user viewing this thread. (0 members and 1 guest)