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Toronto 'shack' on sale for $2.5 million — but there's more to the story

(Realtor.ca)

What’s basically a shack, listed for $2.5 million dollars, is getting a lot of attention. Some are wondering if the crazy days of Toronto’s real estate market are back.

The house is a tiny, graffiti-covered total teardown. Pictures of it were removed from the listing once it started raising eyebrows online. But forget the house — this property is all about location, location, location.

(Google Maps)

Similar properties in the area have recently sold for considerably less.

(Zoocasa)
(Zoocasa)
(Zoocasa)

“This is not your typical, residential listing. This is a huge lot on a high-density street, just steps from Spadina Avenue and in the heart of downtown Toronto.

“It is clear that the seller is considering the potential for the land, rather than the merits of the house itself,” Lauren Haw, CEO of Zoocasa, told Yahoo Finance Canada.

So what does the high price tag say about the state of Toronto’s real estate market? Haw says it doesn’t say anything.

“Potential buyers are likely developers who are considering the highest and best use for the land, specifically the rezoning potential for a higher density development in the future,” says Haw.

One of the biggest selling points is the fact that the house is situated along a laneway.

“Laneway housing has been a hot topic in Toronto, with the city making it clear they would like to find ways to bring more inventory to our market through potential laneway housing,” Tom Storey, a Toronto realtor with Royal LePage Signature Realty, told Yahoo Finance Canada.

“That alone makes this piece of land interesting as its 32′ x 160′ lot size works well for laneway housing if the new regulation comes into place.”

Just because the property is listed at $2.5 million doesn’t necessarily mean that’s what it will sell for. It has been on the market for 9 days, so that price could shift in the coming days or even months.

Storey also doesn’t think the listing means the days of bidding wars through-the-roof price increases are back.

“Overall, the Toronto market to start the year has low levels of inventory and the homes that are priced correctly are selling, while the overpriced listings are sitting on the market,”

“This is a sign of a much healthier market overall.”

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