Prospective Calgary homeowners are finding themselves in a bit of a war when buying a house — a bidding war.
Julie Marion and Clark Shiels recently decided to move to Calgary from Cochrane but told Global News finding a new home was challenging. The young couple found three homes to make an offer on, but lost out on all of them during bidding wars.
They then found a home they loved in the southeast community of New Brighton and decided to try again — despite the intense interest in this home as well.
“When we were sitting outside the house, we could see the cars coming in,” Marion said.
“So we knew that if were were going to put an offer on it we were going to have to be pretty aggressive.
“We picked a number that was well above what the list price was and that was our walk-away number.”
Marion and her realtor were allowed in the home for a 15-minute showing. She said she checked the furnace and the appliances and everything else necessary so they wouldn’t require an inspection or any conditions on the sale.
They then made an offer — the winning offer — although the couple didn’t want to disclose how much that was.
“Definitely a lot more than the list price,” Marion said. “Over $50,000 more for sure.”
“This house checked off probably 99 per cent of everything we wanted,” Shiels added. “So we knew that this was the one and it was worth it to pay more than we wanted to.”
Calgary continues to be a sellers’ market
According to the Calgary Real Estate Board (CREB) it is definitely a sellers’ market in the city right now. Its latest housing statistics for the month of January show inventory levels eased to 2,620 units — a low not seen since 2006.
There were just over 2,000 sales recorded, well below record levels, according to CREB, but still more than 90 per cent higher than long-term trends.
The tight market conditions also resulted in higher prices with the unadjusted benchmark price in January reaching $472,300 — a year-over-year gain of 12 per cent.
“Expected gains in lending rates are contributing to persistently strong demand in the housing market, as purchasers are eager to get ahead of any increases,” said CREB chief economist Ann-Marie Lurie. “We did see more listings this month, but it did little to change the market balance or take any pressure off prices.
“These conditions should persist for several more months,” Lurie predicted.
Buying in a hot market
Natosha Wareham-Bakker with Casually Professional Real Estate Royal LePage Benchmark was the couple’s realtor. She sold their home in Cochrane and helped them buy their new one in Calgary.
She told Global News she wasn’t surprised that the home went for so much over listing, adding that was comparable to other homes selling in the area.
“We were prepared,” she said. “We knew what we wanted to accomplish at the end of the day.”
Wareham-Bakker said they went in with a plan and it worked for them. But she added bidding wars don’t always play out the same and they don’t all revolve around the highest monetary bid.
“Not necessarily,” she said. “There’s a lot of factors that play into offers being accepted.
“Conditions are huge, property inspections, financing. If somebody can come in with a stronger deposit, it may let sellers know that they’re more serious than somebody else.”
As for whether some sellers are playing a “pricing game” in today’s market, she couldn’t say.
“I think there a lot of strategies being used. Some of which are using a lower price to generate more interest in a property, some of them are pricing them right on that line where it could go either way.”
Wareham-Bakker said the best way to win a bidding war is to hire a professional agent.
“You need someone in your corner,” she said. “Someone who will keep your money in check and work for you.”
The strategy worked for Marion and Shiels. They’ve moving into their new home in Calgary next month.
For Shiels, it will be his first glimpse of the home because he was working during the showings.
“Clark has never seen the house in-person,” Marion laughed. “He just saw the photos so when we walk in for the first time, it will be his first time in the house!”