Whitby & Oshawa Real Estate: My Journey to the Suburbs
Author: Tracy Ruddell
I usually write this blog from the collective perspective of our team here at Property.ca but today, I want to share with you my personal story of my exodus to the ‘burbs. I’ve recently sold my Toronto home in the Upper Beaches and I’m now viewing Whitby homes for sale and west-end Oshawa homes for sale. In particular, I'm hoping to find a home in the Blue Grass Meadows neighbourhood.
The impetus behind the move was twofold: to be closer to my family and to cash out of a hot market to, hopefully, live mortgage-free in the suburbs; alternatively, to have a much smaller mortgage that would be covered through rental income generated from a basement apartment. I'm also attracted to the investment potential of these two hot pockets of the GTA and the fact that Downtown Whitby is about to go through a major revitalization. You can learn more here.
To be mortgage-free at 41, if I can achieve it, would be a dream come true but it hasn’t come without hard work. I’ve lived out of suitcases for long periods of time while renovating several homes, been homeless in between moves on three separate occasions, put in a heck of a lot of sweat equity and tied up all of my cash in Real Estate (no annual beach holidays for me). I’ve also made some wise Real Estate decisions in order to build my personal wealth, working together with my Property.ca PRO, and had a heck of a lot of fun along the way.
The problem I’m now facing–and I share this with you because I know that it’s a problem a lot of you are also facing–is that the economics that spurred this decision to move to the suburbs have already shifted dramatically. When I made the decision to move, I immediately jumped into renovations, de-cluttering, painting and staging to maximize the price I could command for my house in Toronto. And while prices continue to escalate both in Toronto and the 905 (check out the latest prices in our April 2017 market report), Durham Region is outpacing Toronto in terms of year-over-year price growth. The prices of Oshawa and Whitby homes are escalating at such a rapid pace, I’m now $100k below the budget I needed to have in order to realize my property dreams. If I wait much longer, I could fall even further behind.
If you’re thinking of buying east of Toronto, hopefully my experiences in this hot spring market will help you plan.
When we see home price increases quoted in the media, they’re usually the average for Toronto or all of the GTA. The figures get much more interesting and useful, in my opinion, when broken down by city.
There are some cities in the 905 that have been appreciating at a pace well above Toronto, including Oshawa and Whitby. We see this trend continuing for some time to come. It’s clearly still more expensive to buy a comparable home in Toronto than in Whitby. Nobody’s disputing that. This will almost certainly always be the case; there’s only so much land in Toronto-proper and there will always be demand to live in a vibrant urban centre close to work. What the recent trends are showing us, however, is that, if you plan on leaving Toronto for the suburbs, you’d be wise to make the move ASAP or you may find yourself priced out. That's certainly been my experience.
To give you a sense of what’s happening in Durham Region, I’ve poured through all of TREB’s data from 2017 for Toronto, Oshawa and Whitby and compared average sold prices to the same period, last year by property type. This will give you a snapshot of the crazy speed of appreciation we’re seeing in certain pockets of the Durham Region:
There are a few outliers due to low sales months but the above charts give a good sense of the trends. Oshawa and Whitby are significantly outpacing Toronto so far this year in terms of rate of appreciation and it’s a continuation of the same trends we saw last year.
How is this impacting what’s happening on the ground in Durham? Here are few things I’ve learned while property hunting that are different from my Toronto experiences.
#1 Open Houses Are Crazy
Our founder, Carl Langschmidt, has taught me a lot about Real Estate over the years. I’ve also learned a lot myself through buying and selling homes (this next purchase will be my sixth home). One thing that surprised me when I started my Real Estate journey is that Open Houses are really more about the REALTOR®, and less about actually selling the client’s home.
Most serious buyers know that they have to get out and look at a house on Day 1 or 2 of list, particularly if the sellers are not holding for offers. We’ve seen Toronto homes for sale sell firm within the first few hours of list. And even on houses that have a set offer date, some REALTORS® and their sellers will still accept a bully bid. Now, by law, REALTORS® have to state in the listing (the version that your REALTOR® will see which holds more info than the public MLS view) whether or not they will entertain pre-emptive offers but that wasn’t always the case. And even when they do state pre-emptives are allowed, not all REALTORS® inform others who have viewed the home that an offer has been received. They should be letting your REALTOR® know if you’ve already viewed the home or have booked a viewing but it doesn’t always happen in practice. Because of this, Toronto buyers who have experienced agents know to jump on new listings, quickly. Listings typically go live Monday to Wednesday (although it differs) and so by the time a Saturday Open House rolls around, serious Toronto buyers already know whether or not they want to offer.
Toronto Open Houses are typically attended by two groups: nosey neighbours, who may decide to list themselves once they see what you get for your home, and buyers who haven’t yet signed with an agent, since they would require an agent to get into your home for a viewing at any other time. These groups are low-hanging fruit for a REALTOR® to generate new business leads from. And so Open Houses became a marketing tool for REALTORS® to sell themselves not your home.
Is this a bad thing? No, not at all. In fact, a third group that attends an Open House is interested buyers who came in earlier in the week with their agent and want to come back for a second look before offer night. If they come and see the house packed with other people raving about it, it can light a fire underneath them. All of this said, Open Houses have been drying up in Toronto lately. In fact, I can share with you that I didn’t get one serious buyer through my Open House (just curious neighbours) and it’s a beautiful, fully-renovated family-home priced well under the average for a detached house in Toronto. The mind reels.
What’s happening out here in Durham Region, however, is quite different. I’ve attended 30 or 40 Open Houses in Whitby and Oshawa to educate myself on the local market. Many I knew I wouldn’t be interested in but I wanted to see what they sold for so that I could build-up my pricing knowledge. Yes, your REALTOR® will be the expert on this but since I work as a Real Estate writer, I like to learn these things first-hand. Every Open House has had at least three or four groups inside for the 15-minutes or so I was there. A small, historic home in downtown Whitby I toured last week had a massive queue waiting outside; it took us ½ hour of waiting in line to be granted access.
What’s clear to me is that Open Houses are still very popular in Durham Region as a selling tool. Yes, they also market the REALTOR® but buyers here seem trained to find their own home through Open Houses and then pull their REALTOR® in afterwards for a second viewing before offer night.
I’m not sure why the culture of Open Houses is so different east of Toronto but it is. Buyers seem to wait for the weekend to view houses that they’re interested in. That’s likely because no-one’s accepting pre-emptives here right now; at least not for in-demand properties. So, buyers have the luxury of waiting until Saturday or Sunday and viewing the home without their agent.
#2 Torontonians are Moving in Droves to the ‘Burbs & Bidding Wars are Fierce
There are a lot of local buyers in Whitby and Oshawa (plenty of empty nesters looking to downsize, from what I’ve seen) along with Brooklin (a lot of young families) but there’s also a heck of a lot of Torontonians making the move eastwards–to Whitby in particular and I’m sure to Pickering and Ajax, also. Sign-in books at Open Houses have been filled with Toronto addresses and it all means more competition on offer night. Similar homes in Whitby to my house (that only received 2 offers) are receiving, 7, 8 even 10+ offers on offer night. Of course, the difference is, my house was priced north of $1.2M and these homes are selling for less than $900k. Banks are tightening up lending policies and a lot of people are struggling to get mortgaged on seven-figure houses.
Knowing that, I suppose it shouldn’t be surprising that we’re seeing so much competition on six-figure suburban homes but it’s something that Torontonians need to be aware of. Moving to the 905 is not going to free you from the horrors of bidding wars. Quite the opposite, come in with your boxing gloves on and be aggressive. I’m finding that there are a higher number of bidders on offer nights here than what I’m seeing in Toronto right now on similar homes and that’s due to the price points. Even when homes are selling a few hundred thousand over list, you’re still getting a lot more property bang for your buck in the ‘burbs.
#3 Pre-Sales Home Inspections are Practically Unheard of
The phenomenon that is the pre-sales home inspection has not caught on east of Toronto but you’ll likely still have to make a firm offer to get the home if there’s competition. That sucks, to say it plainly. I have no problem waiving a home inspection when a pre-sales inspection is provided by a reputable inspector. I paid for a home inspection on my house before I listed as many if not most Torontonians do unless the home is a gut or tear-down. Yet, every home I’ve viewed in Whitby and Oshawa has not had an inspection.
I spoke with many Durham region REALTORS® and they all say the same thing: it’s just not expected out here. Some advised me to pay for an inspection before offer night; that they would arrange for access with the homeowner if I wanted to do that. Can you imagine paying for a home inspection on every house you’re considering bidding on, knowing you may be facing multiple lost bids before you seal a deal? No thanks.
Fair or not, if you’re house hunting in a hot pocket of Durham Region under the $1M mark, you need to be prepared to face the risk that comes with buying without an inspection.
As for me, I’m a few months into my property hunt and have already lost one bid (due to a "conditional upon the sale of my home" clause; I was the top bid in terms of price by just $1,000 if you can believe it; what a tight race!) and pulled out of three other offer nights because my house hadn’t sold yet. A conditional offer was simply not going to fly in the face of multiple offers and I'm not someone who's comfortable risking a firm offer when my house is still on the market.
Now that I’ve sold, I know I’ll have to go in firm at a very attractive price point in order to get a house. I’m also having to adjust my expectations on what a “good house” in the suburbs looks like, at this stage in my life. I had hoped to move into a dream home, mortgage-free. Instead, I’m looking for my next investment, knowing that I’ll have to grow my Real Estate equity further before I can settle down in a home that I’ll want to stay in for the long-haul, debt-free. To all those who say your Principal Residence shouldn't be an investment, in addition to a place to call home, well, I'll match my lovely, mortgage-free home by age 50 with your stock options, anyday.
Even if it costs more than I expected to buy a suburban home, the great news is, Oshawa and Whitby homes present a huge opportunity to grow our personal wealth. So, don't be scared to inaction by attention-grabbing headlines in the media. Just do your homework (including getting mortgage pre-approval), hire an expert, be realistic and stay flexible. One day, may we all be mortgage-free by making the right moves. I just may have to wait a few more years (and at least one more move) to get there.
Did anything surprise you about the experience? Please share your stories with our readers, below.
Lead image: Brock Street, the main street in downtown Whitby, by Chris Harte, 2014. CC BY 2.0 from wikipedia.
About the Author
Tracy Ruddell is not only a partner at Property.ca, she's also a client! Tracy has bought and sold all of her Toronto homes over the years through Property.ca along with our two partners–Condos.ca and MrLOFT.ca. So, when the opportunity arose to partner with Property.ca, she left her 15-year long career in Arts Marketing to help form the brokerage. The draw wasn't just a move to the Real Estate industry that had always intrigued her but also the commitment by the founding partners to build a different kind of brokerage, one that puts people first with a transparent culture and open flow of information to the public.
Tracy is our resident non-REALTOR® at the shareholders’ table and so she thinks like a client. And, as she will tell you herself, she's a dang tough client. Unapologetically so. Buying or selling a home is likely the biggest transaction of your life and, like us, Tracy believes that you shouldn’t have to compromise on service level nor on the experience, knowledge and ethical-treatment that you receive from your REALTOR® and their parent brokerage just because the market is so hot. In fact, finding an expert REALTOR® who has your back is more important now than ever before.
In addition to blogging about Real Estate and home design for Property.ca, Tracy is a self-proclaimed Reno addict always looking for her next project. She's transformed several homes in Toronto from the studs up and has her sights set on Whitby next where her family resides. She's hoping to renovate or build her dream home soon to put down roots. Unless she gets tempted by a new project, that is.