#GTAHomeHunt is a weekly series from the Star that gets into the details of real estate listings in Toronto and the Greater Toronto Area. Have a tip? Email us at firstname.lastname@example.org
Price: $ 700,000
Neighbourhood: Keelesdale-Eglinton West
X-factor: This is a home for potential contractors, renovators and “do it yourself” types that are willing to invest in building up a home that could be worth a lot after construction. It’s also located in a great neighbourhod in an older part of the city, with a great commute time to the downtown core.
There’s also not much of a rush in claiming this home as it’s been on the market for over 70 days. The asking price could also be brought down in negotiations.
If you’re a first-time buyer, you might be wondering, is this a good deal? We brought in our expert, real estate agent Othneil Litchmore, to gain a better understanding of why this property costs what it does.
Why is it priced this way: At about 1,300 square feet, this fairly small detached home located at 370 Silverthorn Ave has three-bedroom, two washrooms and its own backyard. It’s an unfinished place but is priced at $ 700,000 due to the projection of the market value in the neighbourhood.
“It’s priced this way by the seller because they believe the house could be worth upwards to a million if you put money toward the work,” said Litchmore.
In the neighbourhood, similar detached homes are selling for over $ 900,000 — with one home a couple of doors down — fully renovated — that sold for over a million back in June.
This property has been on the market since May. Litchmore believes it hasn’t sold yet due to the price not being right considering how much work is actually needed to be done on the house.
“When people do the math on it, the asking price is too high, that’s the reason why it hasn’t sold,” said Litchmore. “The question someone has to ask themselves is, ‘is it just $ 300,000 worth of work or more?’”
Litchmore can see the asking price coming down on the low end of $ 600,000 with the continued lack of interest. It was previously sold in October 2020 for $ 650,000, which has Litchmore wondering if it could have been purchased by someone looking to build the home, but later gave up on the idea.
In the last few weeks, the price of the home has been brought down twice as it was originally slated at $ 750,000, then at $ 719,000 and is now sitting at $ 700,000. Images displayed of the home show prospective buyers what type of construction and work will be required.
“I think the agent wanted to show you that the home had good bones. The structure is good, you just have to fancy it up, but it probably needs a lot more work than they’re letting on,” said Litchmore.
Litchmore does have concerns about potential water issues that may be persistent with waterproofing shown in the images of the place. He also mentions it might be hard to get financing and insurance on the home due to safety issues and the home needing construction. It may even be a home that needs $ 400,000 worth of work.
Tips to finding places like this:
Litchmore says the key to finding a similar home is knowing what it will actually cost you in total, including renovations to bring it up to market value.
“The question is for someone looking at something like this is whether or not they have $ 200,000 to $ 300,000 to get it up to where they want it to be,” said Litchmore.
“If you know your numbers, this could pay off.”
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