With recent headlines about many condo developments being put on hold due to the market, we’re fielding a lot of questions from our clients who own condo units they’re considering selling.
The most common question is whether now is a bad time to sell a condo. The question may be simple, but the answer is actually a bit complex. Before we get into that, let’s share the story of a condo apartment sale we came across recently. It was a two bedroom, two washroom condo with parking and a balcony located in the west end of Toronto.
The condo sold a week ago after more than six months on the market, for about $20K less than what the seller was asking. The agent who got it sold was the 4th agent to give it try, as the previous three agents were fired. All told, there were five MLS listings before it finally got sold. Four agents, five listings, six months is not exactly a stellar track record. We weren’t involved in either the sale or buy side but we think there are some insights to be had from reviewing what works when selling a condo – as well as what doesn’t work!
Here’s the history.
Let’s go through the details of what happened with this condo sale.
- The first listing went up at the start of November last year, for sale for $725,000, offers anytime.
- The second listing went up January 12th with a new agent, listed at the same price of $725,000. After 27 days on the market, it was terminated.
- The third agent made their attempt in the middle of February, listing the unit for sale at $739,900 but after 27 days, they were also let go.
- The fourth and final agent came onto the scene near the start of April, listing the unit for sale for $649,000 but this time they were holding back offers for a week. That didn’t work and after 12 days, this listing was terminated.
- The same agent relisted it (making it the fifth listing since they started their attempt to sell last year) at $739,900 and sold it for $720,000.
Quite the story! There’s one big question we should try to answer about the sale.
Did the seller get what they wanted?
That’s a hard question to answer, so let’s look at it from a few different perspectives.
Back at the start of November when they hired the first agent to sell the unit, they put a possession date of between 30 to 60 days. They were clearly hoping to be out before the holidays or the start of the new year. That was definitely not the case and instead of selling in November, they had the unit on the market all month, as well as in December, January, February, March and April. If you’ve ever had the joy of selling your home, you know that keeping it in showing ready condition for a week is hard to do, let alone for almost half a year! By this metric, we’d say the seller definitely didn’t get what they wanted.
While we don’t know the seller or the four agents involved in this sale, we do think that interviewing, hiring and signing paperwork four times was not something the seller initially envisioned happening. We also bet that the three times they fired their agent wasn’t pleasant and the paperwork to terminate the listing and their representation would also have been time consuming. As such, from a time spent worrying about the listings and interacting with their agent(s), this likely wasn’t what the seller wanted.
Finally, let’s talk about the sale price. The seller originally wanted $725,000 and 169 days later they sold for $720,000. That’s pretty close to their original list price, though a bit down from the $740,000 they raised it to for the 3rd and 5th listings. It is a pretty quick closing of about a month, so that may have factored into their willingness to take $20K less than what they wanted. We’d say that from the sale price perspective, the seller would have (hopefully) felt like they more or less got what they wanted.
So, is now a good time to sell a condo?
There are a few insights to be had from this example that inform our answer as to whether now is a condo time to sell a condo apartment.
The above example shows that for this specific unit, now was a much better time to sell than six months ago. The average price for a condo apartment in Toronto in November, 2023 was $716,000 and as of March, 2024, it rose to $729,000. That’s just $13K difference, but it’s about 2% higher and we’re at the highest average sale price in the city since September, 2023. As such, now is definitely a better time than it has been!
Despite the length of time this particular condo took to sell, the average days on market for condo apartments in Toronto has been dropping over the past couple of months. At the start of the year, it took 41 days on average for a condo apartment to sell in the city, then it dropped to 30 days in February and as of March, it had dropped to 27 days on average. That still isn’t exactly speedy, but it is the quickest we’ve seen the condo market move since October of last year.
Both the number of sales as well as the average sale to list price ratio has also been slowly increasing this year. March saw the most sales of condo units in the city since June, 2023, so the market is picking up in terms of activity. At the same time, buyers are paying about 99% of list price on average these days, which is the highest it has been since July, 2023.
Put it all together and we’d say that now is a better time to sell a condo than it has been for quite a while, but we’re far from the busy seller’s market we saw back in early 2022. If you’ve been waiting to sell for past six months or so, then that was likely a good decision. If you’re thinking that now is when selling might make more sense, give us a call so that we can dive into the specifics for your unit and building.
After all, we don’t want someone writing an article about your place six months from now!
