Is now a bad time to sell?

High interest rates and uncertainty have made the buyer pool shrink in a big way: the demand just isn't there right now. So…does that make this a bad time to sell? The answer to that question depends on three things: 

1. Your location 

2. The type of property 

3. Your reason for selling

Some neighbourhoods are still competitive: under-supplied, high-demand areas like Rosedale, Playter Estates, Riverdale, and Summerhill will always be in demand – and so will special and/or unique properties across the city. But if your neighbourhood isn’t in demand or your property isn’t something really special, it could take a while to sell, you could end up selling for less than you want – or it could end up not selling at all. 

This isn't the time to be expecting a huge cash windfall. Prices are down across the board, and you’re unlikely to get a “magical” amount for your place unless it’s something extra special. I'm seeing offer dates come and go with no offers, and some properties are selling for well below asking. If you don’t need to sell in the next few months, consider waiting. 

If you do need to sell, however – maybe you've already bought something, you're an investor who is over-leveraged, or interest rate hikes have made it impossible to carry your own mortgage – you'll need to work with an agent who has a solid strategy and the ability to pivot if your first, second or even third approach doesn’t work. 

Sellers need to be realistic right now.

The market has changed, even from what we were seeing one or two months ago. There are so many layers and moving parts, and there's really no one formula that will work for everyone. But there are a couple of “musts” for sellers in this market: your property needs to look fantastic and be priced right!

If you want to get buyer attention, the property has to show incredibly well. That means making updates, staging and styling it – and really pulling out all the stops to make it look great so it’s a 10/10 both in photos and on showings. 

The price also has to be strategic. This is especially important for properties around the $1M mark. Remember that anything over a million requires a 20% down payment. If you price higher than that, you may be eliminating a significant demographic. On the other hand, underpricing slightly can attract buyers who could potentially swing an additional $100 or 150K once they've seen the place and fallen in love with it.

If I do decide to sell, should I buy or sell first? 

Unless you're in one of those areas where properties are still selling well, selling first may be your safest bet. Even if closing dates don't line up and you have to move twice or get bridge financing, it's worth the peace of mind of knowing exactly how much you have to spend on your next place. 

When will things get better for sellers? 

That’s the million-dollar question. Maybe the market needed this cooldown after blazing too hot for too long. This could be our “new normal,” at least for a while. It all comes down to supply and demand: if buyer demand doesn’t increase and we keep feeding the supply, the market will continue to favour buyers. And for demand to get stronger, I think most buyers need more clarity around consecutive rate holds, more positive news from the Bank of Canada, and/or rates to start coming down before things balance out again and they’re able to approach the market with confidence.

The reality is that interest rates probably won’t get any lower until mid to late 2024. The next Bank of Canada announcement is October 25 and experts are predicting a 0.25% rate hike. If that happens, this buyer's market trend will become even more pronounced. 

Talk to an expert

If you need to sell now, work with an experienced agent who can figure out the right strategy and manage your expectations to get you the best result. If you're looking for someone who can help you navigate this tough market, get in touch anytime at [email protected] or 416 721 3345 – I'd be happy to help.