Novocastrian

I couldn't agree more. An important factor is how long the property has been on the market (your realtor will know this).

The house I bought had been for sale for several months and had had it's asking price reduced first by 10% and then a further 11%. I bought it for 9% less than that.

JonboyE

I agree there is no rule of thumb. The listing price does not necessarily reflect a true market price.

Your realtor can find the actual selling prices of recent comparables so you can easily work out an rough market price. After that it is just a matter of how much you want to buy that particular house.

London Mike

Toronto shows no sign of slowing down, so expect 5-20% over asking if buying here.

geedee

If you're looking in Quebec....

We've put our house on the market with 5% built in for offers (agent's advice), in other words it's put on at X with an expectation of X-5% as a reasonable offer.

It's been on for ages and we haven't had an offer yet!

Novocastrian

I think that's overhyped a bit. I agree that as long as interest rates remain near their historic lows, there'll be no house price deflation in Toronto/GTA.

Someone (perhaps it was you) pointed out that immigration still provides for housing demand, stimulated even more by the slow down in construction caused by the credit crunch since 2008/9.

I'll probably be flogging the house I have here in a couple of years, so I hope that your 20% prediction works out though. It's already worth three times what I paid for it (at least), but every little helps.

HGerchikov

A lot of the sales over asking price in Toronto are due to the strategy of listing the house at under market value, to generate multiple offers, people then bid way over asking (and often way over what it is really worth) to get the house. Look at recent sales on the street to help you work out what the house is worth and remember that if a bidding war starts. It is easy to get 'sucked in' to the competition and overpay.

dormy

In Winnipeg houses are generally selling $20-$30K over the asking, bidding wars are the norm.

JimboV6

Not sure about discounts if you are building your own place, but I bought a model home. Our realtor (a family member) seemed to think that large developers want to have something very close to list price go through the books. So we offered the asking price but asked for cash to be refunded to allow us to build a fence, plus all fixtures, curtains, appliances etc. and a few changes to be made. After all, they can write that sort of stuff off as expenses so it's less valuable to them.

Builders in the London area here have been offering $10,000 + in free upgrades. A smaller builder nearby quickly offered to discount their model home by 5%. Seems to be a slow market here at the moment.

In contrast, we ended up accepting $5000 over ask on our downtown Toronto condo.

Back2UK

I have worked for a Alberta Builder and there is always room to negotiate. I have seen deals that negotiate a good price or the builder is willing to add extra's like a hardwood, tile or completed basement. When a site is new, you can always get better deal as the builder wants sold lots.

Paying the sales team is not included in the deal, that is usually separate budget. Paying a Realtor who is representing a client, the builder will not be so willing to negotiate as much in the deal as they have to pay Realtor fees.

Auld Yin

With all due respect, nothing is free. Discounts or freebies are all built into the price. If you believe otherwise you are naïve.

London Mike

I got a list of houses in my district that were sold in the past 12 months and their actual sale prices. I did an average and it was about 8.1% over the original asking price. So there might be a bit of this game playing but mostly there's just hot competition and bidding pushing prices up - that's the reality where I live anyway.

snowcandy

Having spoken to a Calgary builder at one of their developments locally over the weekend- they were offered to do the basement for half the going price quoted. And this was not for a spec home. Will be trying to get a discount on the advertised price for sure when we are in a position to get things started. If you don't ask......

Good point about the realtor, as some are saying to us don't even step inside a showhome before first employing the services of a realtor to help negotiate.

dollface

Be very aware that not all builders co-operate with Realtors, so if you employ one to negotiate on your behalf with a builder, be prepared to pay them 2.5% commission out your own pocket. That 2.5 % is better in your bank account (or upgrades) than theirs, do your own negotiating

snowcandy

Absolutely agree with you on that one. We're starting to get a pretty good idea now of what we want and need in a house and where we want to build so hopefully will be able to negotiate a good deal when the time comes. Would much rather do it ourselves

JonboyE

I would be cautious about trying to negotiate on your own. For sure, employing a realtor will take some potential discount off the table. However, you are putting your wits against trained and expert negotiators in a business and legal environment where they know a lot more than you do.

The contract they will give you to sign will be heavily weighted in their favour.

I am not saying don't do it, but don't assume you will get a better deal if there is not a realtor's fee to be paid.