With the number of active listings in the Greater Toronto Area (GTA) at a multi–year high, the GTA real estate market continued to see buyer competition soften among homebuyers in June — and Durham region was no exception.
Compared to May, those Durham neighbourhoods that had homes selling for above list price saw a decrease in the median overbid amount by nearly 50 per cent in some areas.
In Applecroft, Ajax, for instance, the median overbid amount for homes in June fell to $46,000, down from $85,100 in May. Uptown Ajax also saw a drop in the median overbid amount from $95,800 in May to $65,500 in June, while Blue Grass Creek, Whitby, saw its median overbid amount fall to $50,900 from $69,050 the previous month.
The Top 10 Overbidding Neighbourhoods in June 2024
Five of the top 10 overbidding neighbourhoods in Durham could be found in Ajax, followed by three in Whitby. Pickering Beach, Ajax, which ranked 6th for underbidding neighbourhoods in May with a median sold price of $977,000 and a median underbid amount of -$6,500, moved into overbidding territory last month, ranking #1 for the most overbid neighbourhood. This neighbourhood had a median sold price of $890,000 and a median overbid amount of $90,000.
When a neighbourhood is in overbidding territory it doesn’t necessarily mean that every home is selling above asking price. Instead, it’s a general reflection of overall market behaviour, which can be influenced by seasonal factors, for example, or decisions by sellers, such as to list homes below market value to try to attract more bids. If a particular neighbourhood has a large number of active listings, some sellers may choose to list their home at a lower price to beat the competition. Homes overbid in these neighbourhoods may be due to the list price being lower than the market norm.
The trend in the Durham Region real estate market is consistent with what’s happening across the Greater Toronto Area, where the number of homes selling for above list price fell to 27 per cent in June, down from 36 per cent in May and 39 per cent in April. The 25-basis-point interest rate cut last month doesn’t seem to have done much to get buyers off the sidelines. While Durham Region remains one of the more affordable regions of the GTA, Wahi’s recent analysis suggests that when it comes to finding a home, there’s even more selection now than in the past five years.
The Top 10 Underbidding Neighbourhoods in June 2024
Four of the Top 10 underbidding neighbourhoods last month could be found in Ajax, with four others in Pickering. One of Durham’s top overbidding neighbourhoods in May — Salem Heights, Ajax — moved into underbidding territory. In May, Salem Heights was ranked the highest overbid neighbourhood with a median sold price of $1,300,000 and a median overbid amount of $120,000. In June, however, that neighbourhood was ranked the highest underbid neighbourhood, with a median sold price of $1,255,000 and a median underbid amount of -$39,900.
Generally speaking, the more active listings in a particular neighbourhood the more underbidding there can be because buyers have more bargaining power. The number of active listings makes competitive pricing more essential when selling a property.
At the end of each month, Wahi compares the differences between median list and sold prices to determine whether neighbourhoods are in overbidding or underbidding territory, excluding those neighbourhoods with fewer than five transactions in a given month. The top overbidding and underbidding neighbourhoods are ranked by the median overbid or underbid amount. The median overbid and underbid amounts are calculated by subtracting the list price from the sold price of each individual listing in a given neighbourhood. These are then ranked by the median of all subtractions and presented as the median overbid or underbid amount.
Note: Benjy Katchen is the CEO of Wahi, a digital real estate company that redefines the homebuying experience by putting more power into consumers’ hands. By combining cutting-edge tech and market data with expert realtors, Wahi offers unmatched access to insights, tools and the team that makes buying a home faster and easier.
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