Author Topic: Is my thinking rational (to sell or not to sell v. Toronto market).  (Read 1235 times)

Last Night

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This has been on my mind since March when we got our first unsolicited offer for our house.

5.5 years ago we moved into a rundown bungalow in a desirable neighbourhood.  Over the years I’ve been doing 1-2 big renovations each year. The house as it stands now is in our ideal state as a 1,350 sq. ft. 4 bedroom bungalow.

With that said, the Toronto market has been insane and I almost feel like an idiot not selling, or at least entertaining the idea of selling.  We owe ~300k on the home and we received 2 offers at $1.5M for the home with 40% down, and just last week another offer for $1.7M.  The house isn’t on the market, we have no intention in selling, it’s from people approaching me as I’ve been in the front yard. 

If we sell and a “crash” comes, awesome, can rent for the time being and then buy back in and be mortgage free.
If we sell and a “crash” doesn’t happen, I’ve just priced myself out of the market and will not be able to live in the same neighbourhood I’ve wanted to live in.  I’d be forced to move.

On one hand, where we live now we are walking distance to everything, family, friends, grocery stores, library, public transportation, major highways, we both have short commutes, etc.

It would seem absolutely idiotic not to sell from a dollars and cents perspective, I get that, but the issue remains we have nowhere to go and in my ideal life I’d want to continue living in this same neighbourhood…which means I am already living my "ideal" life.  Wife and I both feel the same way, which makes it such a hard decision.

My last option, where I feel I can leverage the increase in the price of the home is to open up a home equity line of credit.  The bank’s appraisal of the home is ~1.3M  and with the remaining mortgage that leaves me with a significant access to cash.  If the real estate market tanks, I can utilize the HELOC money to jump on other opportunities and buy more property/whatever, if the market stays as is, then I’ve retained the value in the home and I didn’t have to sell/move and look for a new place.  This seems like the most logical thing to do in terms of financial risk and lifestyle risk, having my cake and somewhat eating it too.

« Last Edit: April 26, 2017, 07:25:04 AM by Last Night »


  • Magnum Stache
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Re: Is my thinking rational (to sell or not to sell v. Toronto market).
« Reply #1 on: April 26, 2017, 12:48:27 PM »
How much does it cost to rent in your neighborhood, or a nearby neighborhood where you'd want to live?

I mean, your ~$1 million in equity (being very conservative and assuming you get absolutely reamed on taxes/fees - I'm not familiar with costs of selling RE in Canada) will give you $40k/year to spend on housing, forever. Or you can spend less and have a nice steady investment income stream.

I'm in a sort of similar situation in that my house is stupidly valuable. We don't want to move either so we built an apartment in the basement with it's own entrance to sort of utilize the equity (without taking out any loans). Could you use a small loan to build/add an apartment and have the best of both worlds?



  • Pencil Stache
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Re: Is my thinking rational (to sell or not to sell v. Toronto market).
« Reply #2 on: April 26, 2017, 04:44:14 PM »
   I would sell unless you love the house and do not plan on moving. Look up Canada real estate bubble.


  • Pencil Stache
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The amount of equity built into your home is extreme. Like Waltworks has mentioned, you have the option of liquidating the home via selling, and utilizing the investment to pay your housing expenses.

You could take that cash, invest, and retire to a LCOL area as well. Your options are really quite vast right now. Good luck with your decision. I would sell.


  • Handlebar Stache
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With that amount of upside, it'd be hard not to sell.

Have you looked into other Lower COL areas that would offer the same amenities?  Perhaps you could cash out where you are now, buy a similar place in a similar neighborhood, and have a huge gain for your trouble.