Under Asking: “We could have got more if interest rates weren’t so high.” Three agents explain why they sold for less

The Bank of Canada surprised homebuyers by raising its key interest rate twice in the past two months—another attempt at cooling inflation. At five per cent, it’s now the highest it’s been since 2001. This decision has poured cold water on the market as consumers cope with higher mortgage rates and tighter budgets. No surprise, then, that many homes across Toronto are selling at a discount. Here, three different agents representing three different homes explain why they settled. They also forecast what buyers should expect for the rest of the summer.

Related: “Bidding wars are back, but buyers are wary.” Three realtors share why they went down in price

High Park-Swansea: Riverside Drive

The place: A two-and-a-half-storey classic with a serene backyard Listing price: $2,949,000 Sold for: $2,850,000 Date sold: July 11, 2023 Bedrooms: 6 Bathrooms: 3 Size: 3,700 square feet Agent: Dave Simandl

“The sellers lived here for 34 years and decided it was time to downsize. It’s in an exclusive neighbourhood overlooking the Humber River, which makes it special. Without many comparable properties, in early July, we decided to test the market by listing at just under $3 million.”

“There were lots of showings, but because the home wasn’t recently renovated, buyers were concerned that it would be too expensive to update. This summer’s interest rate increases have had a big impact on first-time homebuyers, but they’re also stifling buyers for higher-end homes like this one. Many are shifting their focus to listings at lower price points.”

“Six days after our listing went up, we got an offer at $99,000 below our ask. Because of the limited number of buyers in the market and the added cost of a reno, my clients felt that the offer was fair. The market has been so topsy-turvy this year.”

The Beaches: Wineva Avenue

The place: An open-concept semi with a basement suite Listing price: $1,599,900 Sold for: $1,525,000 Date sold: July 12, 2023 Bedrooms: 3 Bathrooms: 3 Size: 1,600 square feet Agent: Nat Grillo

“This place is fully renovated, has a separate basement apartment and is a short walk from the water—so we knew it would generate tons of interest. On the downside, it didn’t have any parking. Still, we listed at $1.6 million, which is on the higher end for a semi in this neighbourhood.”

“We set an offer date for a week after our listing first appeared in late June. We got no bites. This is an increasingly common phenomenon: buyers are sick of bidding wars on offer nights, so many of them are choosing to wait before they even book a showing, let alone make an offer.”

“Two weeks after our offer date, we received a bid at roughly $75,000 below asking. Given the lack of parking, which came up as an issue with other buyers, we opted to accept. In this buyer’s case, holding back to see what the market would do worked out very well.”

Downtown: University Avenue

The place: A penthouse with 10-foot ceilings and wall-to-wall windows Listing price: $1,599,000 Sold for: $1,570,000 Date sold: July 17, 2023 Bedrooms: 2 Bathrooms: 2 Size: 1,100 square feet Agent: Harbinder Panesar

“Based on recently sold penthouses with at least one parking spot, we chose an enticing price point at a little under $1.6 million—we would have been happy with anything around that figure. The unit was move-in ready and nicely staged, so we got a steady stream of daily showings and multiple offers.”

“Because the market had slowed down due to rising interest rates, many of the offers coming in were well below our target. My clients weren’t in a rush to sell, so we felt it best to wait.”

“After 24 days on the market, someone offered $29,000 below asking, with only one minor condition and a quick close. My clients accepted, and the buyer was able to enjoy two per cent off the sticker price. We could have got more were it not for the hikes, but our patience in this market definitely paid off.”

Are you an agent who recently sold for under asking? Send your story to realestate@torontolife.com.