This fall, the Supreme Court of Canada ruled that the Toronto Real Estate Board (TREB) must publish sold data for the public.
Is this good or bad? What can home owners expect?
There are still so many nuances to the value of a home that basic sold data and listing history cannot tell the whole story.
Think about your own neighbourhood for a moment. If you got a list of all of the semi-detached homes with three bedrooms, in say for example, Leslieville, would you expect that you could take an average of all of the sold prices and come up with a value?
If only it were that easy.
Here’s the process we undergo to determine the value of a client’s home when they’re thinking of selling or putting an offer in on their next home:
1. Search properties within a comparable geographic area based on style, i.e.: detached vs. semi, number of bedrooms, parking, etc.
This is where the general public would typically have to stop in their analysis.
As an FYI, TREB automatically generates a report that shows the average price based on the homes this search generates. Plus, agents who don’t know the market and don’t do the work will also stop here.
2. Refine based on specific streets that may not be comparable – one street may have more rental properties vs. detached primary residences.
3. Further refine based on specific location features, i.e.: located across from firehall, bus route and condition of neighbouring homes.
4. Going a step further, focus on more specific features, , i.e.: lot size, parking situation and school district.
5. Apply local knowledge of the quality and quantity of renovations and updates within specific homes.
6. Adjust for market conditions at the time of sale, or specific circumstances of the home sale. For example, did the home sell quickly and for less due to highly motivated sellers?
7. Draw on experience and knowledge of homes in the area for the various nuances of why a home may or may not be a good comparable. From the 40-50 homes you start with, there are perhaps only five to eight homes that will be truly comparable to yours.
Ensure you’re working with a full-time professional agent or team. If they aren’t, they may not be seeing enough homes in your area to have the knowledge to provide an accurate valuation. In 2017, just over half of 50,000 agents did 1 or 0 transactions in 2017. Only 10% did 10 or more sales. Source: REMonline.com (in case you were wondering, our agents do almost double that.)
8. Factor in the real-time market conditions. What has changed since those other homes sold? What near-future policy or economic changes could affect the value?
9. Evaluate the competition of other homes currently for sale and how that positions your home in the market.
10. Incorporate knowledge of other homes that are not listed yet but hitting the market around the same time as yours.
When you’re talking about one of your most valuable assets, work with a professional to determine the value of your home before you make any big decisions.
Real estate IS a hobby and it’s even more fun to see what has sold in your area. Sold data just made it that much more fun. Email firstname.lastname@example.org to get set up as soon as our sold data site is released.
The Richards Group Re/Max Hallmark has the honour of being East Toronto’s Agency of Choice from helping so many clients move their lives forward. They have redefined real estate with an experience of total care, unlocking the true potential of your home while delivering industry leading results, so your next move brings you closer to where you want to be.