Many local readers will be familiar with the news of a recent residential real estate transaction in Laurentian Hills Kitchener, where a semi-detached home sold for over 300k the asking price. The article was quickly passed around town and discussed by homeowners and prospective buyers. Ten years ago it was completely unthinkable for a semi-detached home, let alone any residential property to sell for nearly 34% above the listing price in Kitchener-Waterloo. What’s more, a comparable property sold in 2019 on that street for just over 400k. That’s a doubling of property value in under three years. If you follow real estate, it’s a shocking headline. You can read the article HERE
If you look under the hood on this deal though, a couple of things put the sale into perspective. First of all, the listing price was more or less representative of a freehold townhouse in the summer of 2020 when the market was still recovering from the pandemic shock, (read our initial analysis on this HERE) In our current market, with record-low inventory (properties for sale) that was more than enough to generate 53 offers. It’s interesting to note, the winning bid was from an agent out of the GTA, it would be curious to know what the second-highest offer was. But it goes to show, listing under-value to generate competition is an extremely effective marketing strategy for desirable residential real estate in a Sellers’ market.
If you shop comparable sales around the City of Kitchener, a case could be made this Buyer overpaid, but there have been other semi-detached to sell over 800k recently (although they tend to be larger or have duplex status). The property had beautiful location backing onto greenspace and the Buyer decided to ensure their bid was winning, as long as they plan to stay there long term and it’s not something speculative where they only hope to unload at a higher price in a years’ time, they will be served well.
In this market, Buyers need an agent more than ever to determine market value, list price can be meaningless, value is now being determined by the most recent sales (2021 and on), and buyer competition. To acquire property in Kitchener-Waterloo where prices are rising at record levels compared to national averages and also combined with surging population growth, it takes a precise strategy and team approach. Benjamins Realty specializes in ensuring both our Buyers and Sellers are fully prepared to handle multiple offer negotiations. We do this through collaboration with industry professionals, market research, and careful attention to your real estate vision.
Have questions about buying strategies in today’s competitive market?