**Source - Toronto Star - Tuesday Mar. 19, 2013
A house in Toronto’s west end in need of an “extreme renovation” has sold for almost $200,000 over asking price thanks to a frenzy of activity that saw 40 people register bids on the detached home.
Seven potential buyers pulled out at the last minute Monday night before the listing agent took the pile of bids for the owners to review — some with deposit cheques of $100,000.
“I just kept thinking, ‘I hope nobody breaks into my car,’ ” joked listing agent Ashley McInnis, recovering from a frantic week that saw interest from more than 350 potential buyers in the detached home close to Dovercourt and Dupont, transit and the downtown.
Some realtors who had clients bidding on the Armstrong Ave. house are enraged, saying it was underpriced at just $419,900 specifically to stimulate a bidding war. It sold for $601,500.
“I would have priced it at $525,000 or $550,000,” said realtor Dennis Maude, whose client set a personal limit of $525,000 for the 2,600-square-foot, 2 ½-storey house.
Even McInnis was overwhelmed by the interest: Cars were lined up on the street, there was an almost constant stream of people into the house and he had to hire other realtors to be there when he couldn’t to keep things under control.
“This many offers tells me that buyers are out there, that consumer confidence in the housing market has returned,” said McInnis. “They are at the start line and just waiting for the gun to go off, but there is no product out there.”
The Armstrong sale, and a handful of others the last few weeks in prime neighbourhoods across the City of Toronto, speak to a serious supply/demand imbalance that is expected to ease in the post-March Break period when listings traditionally pick up, said east-end realtor Desmond Brown.
While the sale of high-end homes has slowed considerably since last fall, demand continues to far outstrip supply of homes under $800,000, realtors say. And listings have been down significantly across the GTA since 2009.
In some high-demand areas, such as the Junction Triangle, house listings are now half of what they were four years ago, according to the Toronto Real Estate Board (TREB).
Theories abound on why: Baby boomers are staying put, opting to renovate rather than move or downsize. TREB blames the tightening of mortgage lending rules last July, as well as Toronto’s double land transfer tax which makes it costlier to move.
Many buyers and sellers may well be spooked by all the recent talk of a housing bubble and don’t want to risk taking on bigger mortgages.
“There are still bidding wars in pockets of the city, but buyers are very well-informed about the market value of properties and they are paying what they feel the property is worth based on the valuations their realtors are giving them,” said Brown, who recommended clients back off a bidding war on a different home Monday night, rather than waive their condition of a home inspection.
The semi-detached home on Silver Birch Ave. with no parking ended up selling for $30,000 over the $649,900 asking price.