More Homes Selling Above Asking Price

While Calgary bidding wars are nowhere near the scale seen in frantic Toronto, the amount of homes selling at list price or higher has increased from last March.

Single Family Homes

Of the 1042 homes sold in the first three weeks of March, 11.3% have sold at list price or higher.  Drilling down further, 78 homes have sold above list price (7.5%) while 40 have sold exactly at list price (3.8%)

This is an increase from last March when 49 homes sold above asking  (5.3%) and 31 sold at list price (3.3%) out of a total of 928 sales.

Below is the year-over-year comparison of SFH sales between March 1-21 that sold at list price or higher

6 responses to “More Homes Selling Above Asking Price

  1. On the issue of Canada’s housing market, Mr. Flaherty made comments Thursday that suggest he is not preparing new measures in the budget to cool prices.

    Mr. Flaherty said he would like to see if the market will “correct itself,” and noted that there are some signs that this is currently taking place.

    Some Canadian banks are calling on Ottawa to intervene – either by lowering the maximum amortization period for insured mortgages or by raising the minimum required down payment.

    Mr. Flaherty said he finds those suggestions “a bit much” given that the banks ultimately decide whether to approve a mortgage.

    Read the entire article in today’s Globe & Mail

  2. “We have bank executives in Canada saying ’You know, really the rules on insured mortgages should be tightened up’. They must forget that they are actually the ones that issue the mortgages — it’s their market, it’s not my market,” Flaherty said.

    Financial Post March 22, 2012

    Yeah, except all the downside risk lies with the CMHC which is “his market” and the banks can’t all agree to lend less because that would be collusion and illegal.

    Is a preemptive blame shift in the works? Does Mr. Flaherty want the banks to take the fall for however the housing market unravels in Canada, despite it being the policies he implemented that laid the foundation for it to happen in the first place?

  3. Fair & Balanced

    Yes, interesting comment made by the Minister. Sounds like he is going to hold off. He certainly is correct to say that Banks are the ones that issue mortgages, but it is more than a little disingenuous to say as much. It was this Minister’s own relaxation of the CMHC rules in 2006, and some that preceded him in September 2003 & March 2004, that “motivated” Banks to issue mortgages that arguably have lead to a market that is in need of “correct[ing] itself”.

    That motivation being, of course, they could issue bigger mortgages than before with higher LTV/LTC metrics than before while still having the Government of Canada back those loans with the insurance premium paid (actually mortgaged) by the borrower. Why would a Bank not take that deal? It’s “a bit much” for the Minister to say they shouldn’t when he is the one offering it in the first place.

  4. Pingback: More Homes Selling Above Asking Price

  5. He is going through the CMHC route as they are being directed to drastically curtail growth. I think that this will be a real game changer for FIRE as CMHC has been the engine of the debt machine for some time.

    What do others think?

    http://www.theglobeandmail.com/report-on-business/economy/housing/canadas-mortgage-body-moves-to-slow-booming-housing-market/article2378722/

  6. The position of the Flaherty does´t surprise me. Strange that there are still people who believe in the invisible hand of market.

    If you observe the evolution of markets in Vancouver and Toronto, you have to see that something is not OK. I found quite a nice comparison between Toronto and Calgary (Real Estate Market: Calgary vs Toronto), which points out that there is still a steady increase in sales year by year in both cities.

    This of course results in the bidding wars between the customers. I hope that there will be some regulation introduced soon, because I don´t want the prices in Calgary raise sky high like in the biggest two cities of Canada.

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