Demographia International Housing Affordability Survey was conducted in the year 2017. It was done to find the most unaffordable cities in the world. Vancouver got 3rd position and Toronto hits the 13th position in that survey. This ranking is based on the cities with a population of over 1 million.
Toronto has always been Canada’s hot real estate market. Take a look at Canada’s current market stats and you will agree to that. There is 22% jump in the real estate prices because of excellent supply and demand. Increased demand along with scarcity in the options available signals towards lower listing prices, which leads to the bidding wars. And, in the bidding wars, we all know that international buyers with a pocket full of undocumented money take advantage and go beyond the reasonable price of the property. A house was sold in early January this year at the whopping price of $1 million.
The sold house was located in an alluring territory, especially with the Bridle Path steps away, but it was intentionally priced lower than its genuine value to attract the buyers and start a bidding war. This typical strategy utilized by real estate agents and real estate brokers in Ontario and rest of Canada. These bidding wars are very strategically thought of and planned to pull all sorts of the buyers in the race of buying the property. These bidding wars raise the price of the property and land it in the hands of the international buyers.
Barry Kainth, president, and CEO of Galaxy Gates says that the bidding wars are very stressful for the fresh as well as experienced local buyers. It is stressful as well as unfair to them. The buyers have approached him sharing their experience of bidding wars auction. They all felt cheated by those real estate agents and brokers who hold the open property and put it in the situation for bidding wars by pricing it low. Barry Kainth appeals to the Government councils such as RECO (Real Estate council of Ontario) to guide and prepare a set of policies that can put a leash on these bidding wars. Advertisements over asking have to stop. Bank of Canada should stop providing mortgages to the international buyers who hold undocumented money. Once this practice stops, only then the local buyers will be able to afford property in Ontario and the rest of Canada.
It is too soon to tell when all of this is over…
The bidding wars are to promote the big players, the international sellers. But, on the other hand, they are crushing the local buyers too and giving them a difficult time to buy property in Canada. Barry Kainth takes every step he could to stop these bidding wars that are harming the buyers.