Now What?

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TorontoRealtyBlog

So, what?  Nobody wanted to talk about the rental market on Monday and Tuesday?

I’m not hurt, don’t worry.  I lay it out, for y’all ta play it out.

I’ll write, and you can respond, or not.  You can hijack the comments section for a blog about bungalows to talk about peanut-butter.  It’s your forum, after all.  This was always the intention.

But yes, I realize after the fact that people want to talk about COVID-19 and how it’s affecting the real estate market, although in my defence, I wrote Monday’s blog on Sunday night, and the world is changing every twelve hours.

I think back to one week ago, and none of this was upon us.

Buyers were freaking out about how many offers were going to be on the house they wanted to buy.

Now buyers are freaking out about how much to offer the guy in the parking lot at Costco selling toilet paper.

The first time I had heard of “Coronavirus” was probably back in January when we all read about this mysterious flu that was breaking out in China, causing even more people to wear masks than usual.  A friend of mine was in China at the time, and we thought he was insane for going.  Then he came back, and we told him not to come into the office.

Did we ever think that we’d be in the position we’re in today?

Perhaps that’s part of the problem – that we didn’t merely assume we’d be in this position.

A member of my team sold a condo in early-January and the deal fell through on a review of the Status Certificate, but we were having trouble getting the seller to sign the mutual release.  The seller, of course, was in China, and we figured that would be tricky as is.  But with this virus going around?  We had no idea what was about to happen.

The original mutual release that we sent over was for twenty-four hours; lining up with the remaining day left on the 3-day review period written into the condition.  But when that mutual release expired, we sent over another one, this time with forty-eight hours.

One week later, we still hadn’t heard from the seller.

I spoke to the agent every day, and he kept saying, “I haven’t heard from the seller.  Not a word.  No email responses.  Nothing.”

I didn’t believe this, of course.  Who in the world doesn’t have access to email?

Three days later, going on two weeks since our deal had fallen through, the listing agent updated me.

“The seller is elderly and cannot use DocuSign; he needs his printer,” the agent told me.  “But he can’t get to his printer at work because all the offices are closed, and even if they weren’t, there’s no taxi service and cars are halted.  People are not supposed to leave their homes.”

And what did I think?

Well, I questioned whether or not this was all true.

The irony about the “information superhighway” that we created for ourselves years ago, and the fact that the planet has become a small globe, is that misinformation spreads as fast, or faster, than factual information.

Look no further than the videos of Chinese people eating BAT-SOUP that magically appeared last month as the obvious, bona-fide, no-questions-asked cause of the Coronavirus.  Did any of you gleeful Youtube-watchers ever stop to think that maybe, just maybe, this isn’t how the disease started?

If you were a child of the 1980’s like I was, you’ll recall kids on the playground stating, “AIDS started because some guy in Africa fucked a monkey,” and we just believed it.  I know I did.  But I was eight-years-old.

In 2020, it’s almost impossible to distinguish between news and propaganda, and certain media outlets seamlessly blend them together to be slurped up by a hungry and dedicated viewership.

So when I heard that China was on lock-down because of a virus caused by bat-soup, and that perhaps millions of people had died but the government wasn’t reporting it, well, I had no idea what to think.

We got our mutual release on that property, in the end.  The paperwork was signed electronically by DocuSign, so of course, I felt like the lockdown, no-cars, offices-closed story was complete garbage.

Now?

I feel silly.  Like the rest of the world.

The fact that the TRB readers wanted to talk about Coronavirus last week tells me that people are truly concerned.  Fearful and panicked?  Not all of us.  Not even a majority, I would think.  How many happy joggers and dog-walkers are outside right now, enjoying the unplanned vacation?  Is this naivety?  Indifference?  Did the rest of the world overreact?

A friend of mine works in a lab, and he told me last weekend “This is a powder-keg about to explode.”

You’ve heard that before, right?  A dozen times?

But you’ve also heard people say that only 89-year-olds with emphysema are at risk?  And for the rest of us, the virus might be like one or two days of a runny-nose before we’re back to running 10 K’s and eating kale salads?

Who freakin’ knows.

We’re all dealing with this in our own way.

One of my favourite comedians of all-time, as many of the long-time readers know, is David Cross.

In the early-2000’s, David Cross did a comedy routine about 9/11.  Risque, yes, but this was in a better time when comedy was allowed to touch all subjects, and when the people who were perpetually-offended would just avoid, you know – buying tickets to things they found offensive, rather than trying to ensure the rest of the world was forced to take on their values and beliefs.

Anyways…

David Cross did this bit about how the best thing he saw during the days after 9/11 was a guy decked out in spandex, “rollerblading…..with purpose!

His bit went something like, “Nobody’s gonna tell Gabriel where to rollerblade.  Gabriel’s gonna do what Gabriel’s gonna do.  And if Gabriel doesn’t rollerblade to the Chelsea Pier, then the terrorists win.”

The point to his bit was that everybody dealt with 9/11 differently, and some people, in Gabriel’s case, felt that they needed to try to act normal in order to lessen the burden.

I’m not comparing Coronavirus to 9/11, but rather the similarities with how people choose to cope.

For every person reading a book on a park bench today, there’s another one huddled under a blanket watching Narcos: Mexico on Netflix.

Who is the first person to tell the second person that he or she is wrong, or vice versa?

How am I coping?

I’m choosing to work.  At least, where I can.

The Toronto real estate market is not operating in the same fashion as it was one week ago, but it’s also not shut down like bars and restaurants.

As I alluded to on my blog on Monday, I was set to receive offers on a condo listing on Monday night.

The property was in Regent Park; a quaint 1-bed, 1-bath, measuring just under 500 square feet, with owned parking and locker.

We listed at $499,900, because that seemed like a nice number, and set offers for a week later.

I figured that I would get 10-12 offers on the property, and perhaps back in February, I’d have received 15.

I was hoping for over $605,000, since that’s the price at which we turned down a bully offer on the third day of the listing.

In the end, we didn’t get 10+ offers like I had predicted, and we also didn’t get $605,000.

We got 8 offers, and $624,000.

For those playing along at home, that’s over $1,270 per square foot, absolutely obliterating the previous record of $1,232/sqft.

So what does that tell us about the Toronto real estate market?

Well, it tells us that the market is still red-hot!

Alas, that was on Monday night.

And by Tuesday morning?  Well, I think things had sort of changed.

All three of our “leaders” in government; municipal, provincial, and federal, had given press conferences by noon.

And shortly thereafter, I found myself forced with a decision: should we be listing properties for sale this week?

In the end, after consulting with my team, brokers in my office, and a host of colleagues throughout the industry, I concluded that we should not.  Not this week.

So with a King West condo scheduled to come onto the market on Tuesday afternoon, I called my client and told them we needed to hold off.

This wasn’t an easy thing to do.  A 700 square foot soft-loft in a boutique building in the heart of King West?  That’s literally real estate gold.  But with the risk/reward scenario staring me in the face, I figured, “What’s the upside here?”

Today was not a slow day for listings, by any stretch!

Check this out:

I always use “Downtown” as the litmus test in these conversations, and in peak season, you might see 100+ listings on a Tuesday or Wednesday.  On a Tuesday in mid-March, I would probably expect to see 50-60.  So with 57 properties listed today, we are literally right where we should be.

But the issue on my mind is how these properties will be listed, and how they will sell.  At least for this week, with all the changes to our daily lives that we’ve seen.

Most of these listings for downtown condos still have “offer dates.”

But how about that listing at “Rezen” on Frederick Street that came out at $689,000 with offers any time?  Is that how this would have been listed two weeks ago?  And is that how this will be listed in the first week of April?

Not one of my buyers have changed their search criteria.  Four of them emailed me listings today, and I have viewings scheduled for Thursday, Saturday, and Sunday.

But there’s just something about this week, on the listing side, that I can’t get behind.

For those that like to make bets on TRB, as well as predict the future, here’s one for you: I will bet that the average condo price in September/October will top the $722,675 that we saw in February.  That means I believe this market will continue to ascend, that I don’t think there’s a downturn ahead, and that I do believe the Toronto real estate market will get over COVID-19.

But what’s going to happen tomorrow?  Or on Friday?

I don’t know.

That’s why I told one of my clients to hold off this week, and with three listings scheduled to come out next week, we may list all four, and we may list one or two.

As I told a client on the phone tonight, I’m a “planner” by nature.  I like order.  I like preparation.  I like knowing.  But with what’s going on out there right now, flexibility, versatility, and adaptability are crucial, as is the ability to think objectively, and come up with a solid Plan-B.  I told him that we may list his house next week, and we may not.  As much as it pained me to say it on the phone, there’s just no way to know what we’re going to do tomorrow, today.

That’s where this crisis has left us.

And all the while, I could come off as insensitive crying about the real estate market when “people are dying.”  Ask Vanessa Hudgens how she feels about that.

But life goes on, as does everything therein.

My life is centered pretty heavily around real estate, so that’s what I’m thinking about.  It’s what I’ll be writing about too, even if it continues to be the same update on how the market is working, given the societal conditions out there.  But I’m hoping that it also gives many of you an escape for a few moments each morning, as well as an outlet.

Here’s to better days ahead!

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