In a recent analysis by Wahi, it was found that for the first time since March, the share of Greater Toronto Area (GTA) neighbourhoods experiencing overbidding has increased. This signals growing competition for single-family homes, with 13% of the 284 neighbourhoods with at least five home sales in September being in overbidding territory – up from 8.0% in August.
While 1.0% of GTA neighbourhoods sold homes at asking, the majority (86%) of neighbourhoods still saw homes sell below asking price.
“With the start of the historically busier fall real estate market, stronger competition is expected,” says Wahi CEO Benjy Katchen. “However, we’re still seeing transaction levels and bidding activity well below last year’s level for this time of year.”
In September 2023, 24% of GTA neighbourhoods were in overbidding territory, and an additional 3.0% of homes sold at asking.
Demand for single-family homes fuels bidding wars
The competition between housing types is diverging, with condominiums and single-family homes moving in opposite directions. In September, only 5.0% of neighbourhoods with at least five condominium sales saw overbidding, down from 8.0% in August and 10% in the same period last year.
For single-family homes, however, 18% of neighbourhoods experienced overbidding, up from 13% in August. Despite this increase, bidding activity remains far below last year’s levels, when 35% of neighbourhoods saw overbidding for single-family homes.
Most homes still selling below asking
The majority of homes sold in September were purchased for less than their asking price, with 69% of all properties selling below asking – down slightly from 70% in August. A year ago, 61% of homes sold for under their listing price.
By housing type, the trend continues to differ. For single-family homes, 64% were purchased below-asking in September, a slight improvement from August. However, for condominiums, 77% of sales were below asking, consistent with August figures.
Top 5 underbidding GTA neighbourhoods
For the first time in 15 months, Oakville’s Eastlake neighbourhood did not rank among the top five underbidding neighbourhoods in the GTA. Three of the top five underbidding neighbourhoods were located in the City of Toronto, with Forest Hill reclaiming the top spot after placing fourth in June.
Luxury markets priced between $2 million and $4 million dominated the list of underbidding neighbourhoods, with Port Credit in Mississauga being the exception.
Top 5 overbidding GTA neighbourhoods
Toronto neighbourhoods accounted for four of the top five overbidding areas, with St. Clair West leading the way in Old Toronto. The Danforth and Parkwoods were among the GTA’s top overbidding areas in August.
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