Maybe they saw the recent story in the Toronto Star about the house that was way under market value due to all the work it needed–it garnered 40 offers and sold for $200,000 over the asking price…
Please do not confuse the red hot Toronto market with conditions country wide. I assure you such is not the case. But downtown Toronto, on the edge of Yorkville, it’s a very hot neighbourhood. Pricing wars are usually easy to spot as the unit is a real deal. Sounds like these folks needed a reality check, for sure. Hasn’t sold in three months and they want to start a bidding war, and are offended by an asking price offer, sounds terribly mis guided to me.
I think the OP dodged a bullet. Double the deposit? Are they crazy?
That is nuts. I think you had the misfortune to encounter that unpleasant creature, the home owner who doesn’t realize that their house is worth what someone else is willing to pay for it, and nothing else.
Heh. We’ve thought about doing that if we run into buyers like we had for our last house sale - everything was fine, then they had the home inspection done, and they decided that in spite of the house passing the inspection handily, they wanted to pay even less than the agreed-upon price. If I had it do over again, I would have told them to go fuck themselves at that point, knowing what pains in the ass they would turn out to be (that wasn’t the last problem we had with them).
DvorJacques has given a pretty good explanation of Canadian real estate practices; here in Calgary, another pretty hot market, prices will go above and below asking. It is expected that people will offer less than your asking price, but is is also common for bidding wars to happen on particularly tasty properties. There’s a certain amount of etiquette involved; you can offer anything you like on a property, but you do risk pissing off the sellers if you give them a ridiculously low bid, and you might cause them to tell you to get lost. People buying houses here have to keep in mind how much they’re willing to pay, too, in case they do get caught up in a bidding war. The advice here (and everywhere, I think,) is to not fall in love with a house.
A couple of years ago when Calgary was in the middle of the boom, yes, it was expected that you would get more for your house than your listed price. Houses were selling in a day - with that kind of heat, bidding wars were very common. Hell, when we sold our last house three years ago, we got multiple offers at our first open house.
When we sold our condo in 2005, we had a bidding war. It was actually pretty exciting! We listed it, had an open house, and within four hours of the start of the open house, we had 20 offers. Our realtor brought us the top five offers and we chose the one we’d accept. We ended up getting 25% more than our asking price and no conditions.
Conversely, when we flipped a house in Chestermere (a suburb to the east of Calgary), our house was on the market for 8 months. Luckily, we finally got an offer and did make a good chunk of money on it, but it took a lot a patience and declining a few lowball offers.
About 8 years ago, when I was looking to buy my last home, I found a place that I liked and made a bid. I offered their asking price but wanted them to pay for the septic tank inspection (which according to the realtors I talked to was the seller’s obligation), the termit inspection (ditto), and to remove the heavy junk in the garage.
Less than 20 minutes later, realtor called me to say that the seller was seriously offended and that the house was being sold “as is”, so he or she had raised the price 5,000. I was really shocked, the housing market being what it was. I refused and went on my way.
About a month later, the realtor called me back to say that the seller had thought it over and agreed to my offer. Seeing as how I was in the process of moving into the house I had bought in the same area, I turned him down.
In the spirit of schadenfreude, I made a point of driving by that house a couple of times a month. It was on the market for over a year before it got turned into a rental, and then was empty more than it was rented. Neener, neener offended seller.
I don’t know Canadian real estate laws and contracts, but those sellers may be getting into a mess with their realtor over this. The realtor is also not serving them well if s/he’s not making it clear to them that asking for more than their “asking price” is not going to work.
When we sold our first place, 20+ years ago, the realtor mentioned that if he brought in a full-price offer with no contingencies, he’d be entitled to his fee even if we decided not to sell for whatever reason. Which I think is a valid point: I mean, you hire them to do a job, and they do it, they should get paid.
In the OP’s scenario, maybe the realtor wouldn’t be entitled to the commission since the offer really wasn’t full price/no contingencies. But I’d bet their realtor is pretty fed up with them right about now!!
As far as bidding wars go: Those can indeed happen if the market is hot enough (and we benefitted from that scenario, 10 years ago). If a condo is on the market for 3 months, the market is NOT hot enough.
If you list a place at a certain price, you’d damn well better be prepared to sell for that price - you can NOT expect a bidding war. When we sold, we knew exactly what we needed to take out to have a down payment on the next house, and that was our list price.
Congratulations (?)** Dvor** on dodging a bullet with crazy sellers, etc. I like your style kayaker. Real estate isn’t a game for the faint of heart. I haven’t really posted much about this, but my house sale closes in 10 days. The housing market in my old home town is really tight, and I worked with the Realtor who helped me buy the place 7 years ago.
Because of me working across the country we really had one day available for an open house. (I’m not going to post the wherefores and the whys on this board). We had dithered about the price, my realtor suggested one price, I had floated 5000 more to her, but she strongly recommended her price not mine. Then at the last minute, she switched the asking price to my higher figure. (She saw some other information, or something.)
We had 4 bids. One for less than asking, but cash deal no conditions. Not a bad offer, actually. We had two bids for 5K more than asking. And one for 15K over asking, usual conditions like home inspections and financing.
It closes in 10 days. Very glad its over and was so painless. The day it happens look for a thread in 80 point blinking font. (Not really mods, but there may be an ecstatic thread that day, also all-hailing a certain Doper who gave me some advice and pointed me to some cool people that day. Be warned. 
)
Yeah that was a real red flag for me, even if I desperately wanted that condo and was willing to pay the extra 33% I would still balk at raising the deposit. Why would they want more of a deposit? Are there seriously people walking away from 20K deposits?
I think the issue here is probably more than 50% due to their realtor, I found another condo in the building I’m in currently. It is 1150 sq ft and there are 2 other 1300sq ft condos for sale in the building. The 1300sq ft condos have asking prices of 550K and 600K, the 1150sq ft condo is going for $750K (!) it has upgrades like granite counters and flooring, but still. I emailed my realtor about it and discovered that they are using the same realtor as the original condo, no way am I touching that one with a ten foot pole.
Also: what is up with granite flooring? Do people pay extra for that? sounds like a good way to raise your heating costs and shatter anything that falls on the floor.
Smart move on the place with the crazy realtor!!
Granite flooring? I wonder that the building even allows that. Around here, even hardwood floors are controlled by some condominiums because of the noise factor (your downstairs neighbor would hear every single step).
I also tend to think of any kind of tile / stone flooring as being rather more suitable to warmer climates (like Florida), or bathrooms. Brrrr.
Well not to spark a 10 page long thread this is in Canada and 99% of people take their shoes off indoors so granite floors are probably less of a noise issue than they could be. But yeah cold hard floors are just not homey to me, this place seemed only to have it in the hallway and dining area and carpeting everywhere else but I imagine guests probably have a hard time feeling welcome when they walk into a place like that.
$200,000 worth of granite counters and flooring? I doubt it. 
Good call (on both the realtor and the granite flooring).
Update:
We viewed a condo today, we’re going to put in an offer, it’s way better than the original one and it’s priced reasonably so it’s likely that they are not lunatics expecting a bidding war so this time tomorrow we may have a conditionally accepted offer, yay!
Our realtor told us though that she had heard directly from the seller of the previous place, she is definitely a total nutso. I learned that our realtor emailed their realtor saying why we wouldn’t be responding to their offer and that they should list the condo for what they think it’s worth and stop wasting other people’s time. The realtor forwarded that email to the seller who decided to respond to our realtor directly. She demanded to know exactly how they were wasting people’s time, blah blah blah. Our realtor actually responded to that presumably calmly explaining that they were smoking crack if they thought they were really going to stimulate a bidding war. She responded to that presumably with more invective but our realtor is not going to respond again.
What a difference with the sellers of the current place, we asked their realtor about heating and cooling costs and he forwarded a nice email saying the average charges of 6 months of gas and electricity bills. Plus they have cats, that means they’re good people doesn’t it?
That does sound good, Jaques - fingers crossed for you!
And yes, the cats are a good sign.
Concur!!
Is this condo still in the Bay/Wellesley area?
Nope, Church/Dundas. It’s not our preferred area, and the school district is somewhat worse, but we’re going to try to get our kid into the daycare of the better school and that will mean he has the right to go to the better school.
The neighborhood has a very different feel than Bay/Wellesley but I like it, Ryerson gives the place a vibrancy that Bay/Wellesley definitely lacks.
Huh, just realized that Bay/Wellesly is in the neighborhood of UofT, weird how that university doesn’t affect the neighborhood at all.
… Yet. It takes people like you to make an area better. I have spent the last 20 years working in Baltimore and DC and I can attest that neighborhoods change, and sometimes quickly, from mediocre to good to bad or whatever. Mostly neighborhoods have been getting better and it’s refreshing.
So if a place is decent to good and you move in, you might find yourselves being part of the movement that makes a place better.
That area has definitely been gentrifying for a while. A few years ago, a former co-worker of mine bought a condo/townhome/loft near the Moss Park Armoury a few blocks away and it was still a bit scuzzy at the time; this was right around the same time that a homeless guy got murdered in the park.
I’d probably live there in a heartbeat, but my wife hates street traffic noises and panhandlers so she wouldn’t be caught dead living there. I wonder how much noise you’ll get from concerts and so forth in Dundas Square this summer.
I’ve made an unconditional full-price offer.
We really liked a particular house but the backstory was apparently the owner didn’t really want to sell and was being forced to because of a divorce.
The house had been on the market for over 2 years and every offer was rejected. The seller’s agent asked if we’d be willing to put in a full-price offer with no conditions in order to get this albatross off of her neck. We did, he rejected it, and the agent successfully sued him for her full commission.
I’ve been thinking about the granite floors and while I appreciate the beauty of granite it seems to me to be a less than ideal flooring surface (or countertop for that matter). You could ameliorate the cold foot factor with radiant heat but if it’s polished it will be super slippery when wet, subject to fracture, it is slightly radioactive, and it has to be sealed. Likewise marble (except the radioactive part).
Congrats on dodging that bullet, Dvor.