An Asking Price for Ontario Real Estate
Published on 29 August 2022, 07:22:56 AM
Split levels selling for $367,000 and $306,000 over list price — who knows where Canada real estate prices will land buyers and sellers.
Should you ever offer over listed sales price? Axess Law sees many buyers who do, especially —
When It’s a Seller’s Market
Housing demand and supply rarely line up. Competing for limited inventory in a pent up market can be lucrative for sellers.. No wonder you feel pressured.
Relax! A temporary step back could save you from making real estate offers too rich for your mortgage lender.
Check out how long homes are taking to sell by looking at the number of days the property has been listed for. Less than 10 days and it’s anyone’s guess how much a modest bungalow in the Greater Toronto Area could go for.
You’re in a Bidding War
Popular homes in desirable neighbourhoods often attract multiple offers — real estate in Ontario is a hot commodity. Find out from your realtor if you’re in a bidding war. Then put your best offer forward and hold your breath. Don’t go too far over budget. You could regret it if your offer is way over the appraised value.
A Home’s Under Contract, Over Budget
Sure it’s disappointing to find a property you like is under contract. Persevere. You still might get it if the deal falls through. Pending sales can be subject to multiple conditions. All it takes is second thoughts, a negative credit report, or a better deal elsewhere for prospective buyers to disappear. The house could be yours by outwaiting your competition, rather than offering over asking price for Ontario real estate.
It’s Too Good to be True
Look under the wrapping. Sellers who deliberately list for less than market value could be pushing for a bidding war. Ask your realtor for “the comps”, comparative values of similar homes in the same or surrounding neighbourhoods. Comps give you a realistic idea if a home is priced right for its age, condition, and location. They’re how you determine fair asking price for Ontario real estate.
What Sold Over Asking Means
In case you’re wondering, do houses usually sell for the asking price for Ontario real estate, or how much over asking price should I offer on a home in 2021 in Ontario, the answer is complex. Realtor signs advertising “sold over asking” can be deceiving. Listing a home for less than fair market value may give buyers a false sense of urgency.
Before you offer over asking price for Ontario real estate, check the comps. Ask your realtor what offers have already been rejected. Then go in with 1% to 3%. The reality is offering over asking price for Ontario real estate can be problematic. House appraisals, their fair market value, decide what mortgage lenders will finance. You may be forced to make a larger down payment to make up the difference.
Cash is King
Cash offers cut out the middle man, your mortgage lender. Instead of waiting for a bank or credit union to approve financing, the seller can close the deal right away. You’ve offered cash. Obviously, or so the seller thinks, you can afford the house. Can you offer 20% below asking price for Ontario real estate? Reduced buyer competition due to climbing interest rests could be your best shot at scoring a bargain.
When you’re up against cash buyers, try going over list. It’s a windfall for the seller, so don’t be afraid to make your best offer.
What to Ask Your Realtor About a Home You Want
You could find out how popular a home is just by asking your real estate agent a few pointed questions.
- What offers have been rejected?
- What are homes selling for in this market?
- What is the average asking price for Ontario real estate in your community?
- How long do you have to make an offer?
- Can you include a clause in your agreement of purchase and sale to beat the best or any offer?
- Can they show you comparable homes at lower prices?
Your realtor’s duty to you.
What to Offer in Bidding Wars
Always offer no more than you can afford to pay.
New homes mean extra expenses, like upgrades, moving costs, utility hook-ups or replacing a water heater or roof. Common area fees for condos or, if you are new to home buying, school or property taxes can be an unexpected financial burden.
Strategize before you make an offer:
- get a home appraisal — you will have to make up the difference between appraised value and your offer in cash
- increase your deposit to show you’re serious
- get a preapproved mortgage so you don’t go over budget
- and only include necessary contingencies, so you can close quicker than other buyers.
Private Mortgage Rules Ontario
Private mortgages can make the difference between affording a home you desire and getting financing in time. You borrow against the equity in the home’s value. Mortgage stress tests and stellar credit reports are not required. Your home is security for the loan.
Private mortgages carry higher interest rates and transaction fees. Lenders are less likely to work with you to keep the home if you run into financial problems. And your title insurance could be compromised if you share a lawyer with the lender.
Have Axess Law review the details before you sign for a private mortgage loan. We cover off all the legalities before we complete your real estate transaction.
Having second thoughts about a second mortgage?
Why You Need a Real Estate Lawyer in Ontario
Before or after you sign, let an Axess Law real estate lawyer review your agreement of purchase and sale. We add in clauses that protect your interests as buyer or seller.
Including a home inspection clause prevents you from inheriting problems the seller should rightly correct and gives you the right to walk away if a home requires costly repairs. Axess Law writes your offer to purchase in a way that erases any questions about If a real estate deal falls through who gets the deposit.
We have licensed real estate lawyer services in Toronto, Greater Toronto Area or Ottawa when you need one and virtual lawyer services anywhere in Ontario.
See 25 questions to ask about real estate services.
Flat Fee Legal Services You Can Afford
Axess Law’s affordable real estate lawyers cost far less than traditional legal services.
Our flat fee legal services start at $999.99 plus HST for real estate buyers or $799.99 and up plus HST for property sellers. We transfer title to your property for $649 plus HST and up or work with your lender to refinance mortgages from $799.99 and up plus HST.
We can meet with you remotely via secure, online video conferencing software or in person at any of our Axess Law locations in Ottawa and Greater Toronto Area.
Make Online or Phone Bookings
Making an appointment is as easy as using our online booking form or picking up the phone.
Dial toll-free to 1-877-552-9377 or call our 647-479-0118 lawyer line for an Axess Law office near you. We’re open 7 days a week and have day or evening appointments when you need them. Check out our onsite parking and easy transit access.
When you prefer it, our lawyers video conference online from the convenience of your home or office. Axess Law’s virtual video conferencing software is private and confidential. You can trust Axess Law with all your real estate transactions.
Call us today to make an appointment.
