Not All Homes in London Ontario Are Overpriced!

No, not all homes in London are overpriced! Yes, we are now in a buyer’s market, but that does not mean every seller will reduce their price.

There is no question that some sellers have overpriced their homes, but it is essential not to compare these overpriced homes with those that are priced well.

Here, then, is the crux of this market.

Most buyers and their Realtor are making low offers, regardless of the comparables and the value of an individual home.

The ‘throwing out the baby with the bath water’ mentality is distorting the market. I contend that this mentality harms buyers by leading them to forgo fundamental value in favour of perceived value.

If I may, here is a classic example that not all homes are overpriced.

A townhouse condo is listed for sale at $650,000, and it is the only one available. Five months earlier, one sold for $565,000. Realtors and their clients will consider the $650,000 unit overpriced. I dug further, and here is what I discovered:

• The seller was underwater. (Meaning, they were in financial difficulty and had to sell quickly or lose the property to the mortgage holder)

• Nine photos, no video or floor plans.

• No status certificate is available; it is the buyer's responsibility to order one.

• Initially listed for sale at $639,000, no offers. The listing was cancelled, reduced, and expired three times before ultimately selling.

• Everything in the unit was original from the builder, no upgrades.

• The listing Realtor was from the GTA area, and the only way for local Realtors or consumers to arrange a showing was by calling the brokerage’s switchboard, usually an answering service, then waiting hours for a call back, if ever, and by email, two to three days later!

• The unity was dusty and had a stale, musty odour because it was vacant.

• The rugs were slightly soiled, and the walls required paint.

The $650,000 unit?

• Upgraded throughout with high-quality flooring, lighting, window coverings, and appliances, and decorated.

• One more bathroom

• The backyard view was of a green space, not a six-foot wall.

Now, Are All Homes in London Overpriced?

What do you think happens when a Realtor and their client see the $650,000 place? They appreciate it but consider it overpriced because a unit sold five months earlier for $565,000.

Even though others that sold in 2024 in that enclave were in the $619,000 to $640,000 range!

In one instance, an offer of $575,000 for the $650,000 unit was refused because it was perceived as insulting not only the seller but also his Realtor. A counteroffer was declined; the verbal offer was $589,000.

Two weeks later, that buyer purchased a unit in another area of town for $595,000. The unit was older and of lesser quality than the $650,000 unit, and the condo fees were $285.00 higher.

Hmmmm! Who was the winner here?

Want more examples? I see houses and condos that are a great value sitting on the market waiting for the right buyer with foresight! Those sellers are not desperate or in need of selling, so why play a game you are going to lose as soon as you start?

Don’t get me wrong here, this is an excellent opportunity for buyers to take advantage of the softening real estate market. The homes that are priced appropriately, their Realtor, and the owners are realists and have priced their property accordingly.