Toronto real estate agents using new tactic to fuel competition and boost housing prices
A sold sign is shown in front of west-end Toronto homes, Sunday, May 14, 2017. (Graeme Roy/The Canadian Press)
TORONTO -- If it sounds too good to be true, it almost always is.
A new trend in the Toronto real estate market, in which realtors are listing residential homes in the Greater Toronto Area for only a dollar, has left some buyers with questions.
Just because a property is listed for a dollar, it certainly doesn’t mean that buyers will pay that much, though.
Toronto real estate agent Paul Poliszot currently has a property at 15 Rebecca St. listed for one dollar. While he’s doing it as a means to attract attention to the property, he says listing prices have not reflected actual property value for some time.
“We've had a crazy six months. It's been extremely volatile. Prices have fluctuated and asking prices and listing prices have not been reflective of a property's value for quite a long time,” Poliszot told CTV News.
“All we're really striving to do [is] be innovators in the real estate investment space in Toronto and serve our clients as best we can,” Poliszot said.
He says the low listing price has attracted hundreds of inquiries.
Marco Momeni, a Toronto realtor testing out the same strategy on 16 Kenrae Rd. in Leaside, has different motives.
“I've been in the real estate business in Toronto for the past 20 years and this is only the second time we are not disclosing the price because this is a very unique property,” Momeni told CTV News Toronto.
This particular property has approvals in place that could allow it to be redeveloped into two semi-detached homes, so its current property value wouldn’t reflect the potential it holds, Momeni says.
“They have all the approvals in place to convert the property to semis, so that's why they don't really know [the value.] They've been approached by few developers in the past year, so they didn't want to disclose a price. They want to know what number is the highest number that the market can get to for this property rather than imposing a price,” Momeni explained.
Desmond Brown, Toronto real estate agent and host of podcast Soldinthe6ix, spoke to CTV News Toronto about the trend, which he says is nothing more than a marketing strategy.
“We see [the trend] periodically. In residential real estate, to me, if an agent puts [a listing] out for $1, [..] it’s to generate as much activity as possible on it. So they can get multiple bidding wars happening or multiple offers on it.”
When representing a buyer, however, Brown says it can be irritating.
“It ends up generating a lot more competition [than is] really necessary. So it's a waste of a lot of people's time,” Brown told CTV News Toronto.
While Momeni is implementing the strategy himself, he doesn’t recommend it for everyone — only for unique properties.
“I don't recommend this for the average seller,” Momeni said, “and that comes from 20 years experience with buyers and customers.”