Whenever Arnold Schwarzenegger utters his ‘I’ll be back’ catchphrase in the Terminator movies, there’s no doubt his cyborg character will follow through (and wreak some serious havoc in the process).
Terminated real estate listings are less predictable. Whether a homeowner decides they no longer want to sell, or contracts between sellers and listing agents expire before an offer is accepted — it can sometimes be years before a terminated listing reappears on the market.
Since the start of 2022, however, there has been an unprecedented surge in the number of terminated condo listings across the GTA. From 380 in January to 2,822 in June — this represents a 643-percent increase in the past six months alone. And it’s certainly sending a clear message to home-hunters: Sellers are not getting the offers they want.
“Many sellers are still operating under the impression that this is a seller’s market, so they are listing too high and not seeing any action,” says Alex Hood, a realtor at Strata.ca. “At the same time, rising inflation and interest rates are making buyers feel uncertain about the trajectory of the market, which is causing them to be more conservative with their bids.”
Combine all of this with a near-tripling of total condo inventory since the start of 2022, and Hood says he expects the number of terminated listings to wane “as sellers' expectations start to align with the realities of the current market.”
In this uncertain climate, “most sellers who have terminated their listings are waiting for a better time to relist, or have shrewdly decided to lease their property instead,” says Strata agent, Anna Wong, pointing to double-digit percentage increases in condo rental prices, both overall and per square foot, since the start of 2022.
Unlike the GTA’s oversupplied sales market, condo rental inventories are down nearly 60 percent from January levels. “After a winter hibernation, rental markets are roaring back with multiple offers, large rental deposits, and very few days on the market,” says fellow agent Nate Légaré.
Some sellers, however, will relist sooner rather than later — and therein lies an opportunity. “In a cooling market, it is fairly common to see a listing get terminated and then relisted a day or two later with an adjusted price,” says another Strata agent, Galina Sheveleva. “This usually signals a couple of things to buyers: One, there is some wiggle room in the price that the seller is willing to accept; and two, the seller likely needs or wants to sell in the current market.”
The new price of a promptly relisted property often depends on whether an offer date is involved, Wong says. “If the seller is still going with an offer date, the new price will usually be lower than the previous one to attract buyer interest. If there’s no offer date, the price typically increases because the seller is going with the price they wanted in the first place.”
Either way, she adds, “the relisting will make the sellers' intentions a lot more transparent and give buyers a better hand at negotiating.”
It also fuels buyer confidence. “An uptick in terminated listings is when we typically see more negotiations and low-ball offers,” Sheveleva says. “At that point, buyers know they have the upper hand in the market.”
With the GTA market shifting to favour buyers, it’s becoming increasingly important for sellers “to get the price right from the get-go,” advises Sheveleva, adding that sellers who must part ways with a property may need to lower their expectations to make it happen.
For buyers, meanwhile, the market is as friendly as it’s been in years. “As we know from real estate history, when the market dips, it's the right time to buy,” Wong says. “Don't wait too long as things will eventually pick back up.”