Here is a listing of the five-bath, seven-bedroom home on High Point Road. Toronto It does not contain any images of the interior of the house or any details of the property.
Still, it all comes with a $16 million price tag based on its potential.
To help buyers imagine what could be built on the two-acre property located in Bridle Path, one of Toronto’s most prestigious neighborhoods, with neighbors like rapper Drake and singer Celine Dion, the seller included three sets of architectural plans that envision the property. as a luxury property.
It’s an emerging trend.
Property sellers floundering in hot luxury markets began listing their properties with architectural plans already included, in hopes of attracting luxury buyers and securing a higher price for land. Sometimes, properties come with permits so potential buyers can begin construction as soon as they close.
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“In the ultra-luxury market, what we typically find is that a particular buyer may not be familiar with zoning and what’s possible in a particular property,” said Eileen Lasswell, listing agent for the High Point Road home. “This is really starting to allow a particular buyer to use these plans as a launch pad.”
Luxury demolitions are growing in popularity, with the number of listings rising amid widespread inventory shortages, according to an analysis by Realtor.com, which describes a luxury home for over $1.5 million. Teardown high-end listings have been accumulating since 2020, with the number of listings growing 19.8% between 2020 and 2021, keeping pace with the overall luxury home market (up 19.4%).
The prices of these properties are also increasing. Compared to the first quarter of 2021, luxury demolition prices increased by 14.9% as of the first quarter of 2022, while total luxury prices remained stable over the same time period, according to the data.
In the last quarter, luxury homes marketed as demolition were on the market for 22 days less than typical luxury properties, indicating interest in ‘do-it-yourself’ opportunities compared to buying an existing luxury home.
A property that comes with plans can sell even faster, helping buyers reduce the painstaking time they spend researching what type of home can be built on the plot.
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Helping a Buyer Envision their Dream Mansion
In the case of the High Point Road property, the seller hired three architects (Audax, Memar Architects and Richard Wengle) to design a home that better reflects the larger mansions typical of the private Toronto enclave, Bridle Path. Each of the plans has different luxury elements such as a conservatory, climbing wall and indoor swimming pool. Two of the plans are designed in an “iceberg” style, with most of the square footage of the property being underground.
“Many people don’t even realize that this is possible in Toronto,” said Ms. Lasswell.
Ms. Lasswell said a number of plans envision a home that would not require further city approval, while the other two would require going through this process, which could take six months or more. Each plan includes estimates of the timeline and building cost.
“Many of these buyers have money, but they probably haven’t built anything on this scale before and don’t even know where to start,” he said. The plans can help them get a “realistic view” of what they’ll need to build their dream property.
“Overall, a buyer will not choose to build a house exactly as designed, but this gives them the opportunity to at least have a starting point,” added Ms. Lasswell. Ultra-luxury buyers can often work with their own architect to try to personalize their home by adding a poker room, basketball court or other personal touches.
Sellers should be prepared for the high price tag of making plans. Hiring a well-known firm to create plans for a large property can cost upwards of $300,000 or closer to $50,000 for a smaller property.
Buyers are also waiting to see the full plans. More than flashy pictures, they want to understand how to arrange the house.
“Is there staff housing? How big would that be? Where would they be? Is there a second kitchen? Is there more than one access point? What are the security features?” said Mrs. Laswell, “Otherwise you have to start getting really detailed, you’re going to have a lot of questions, and if you’re just doing something very simple, visualizations can do more harm than good.”
Ms Laswell said that despite the huge cost to the seller, plans are indispensable to educate buyers and ensure that the seller receives a strong offer with a faster turnaround.
“Properties with a land value of over $15 million don’t show up that often,” he added. “I can’t imagine marketing this property without at least putting it together.”
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Adding Value to the Final Sale Price
The inclusion of architectural plans can add significant value to a property ready to be demolished.
Brothers Ryan and Matt Burns, real estate agents with Compass in East Hampton, New York, encourage demolition sellers to include possible plans.
“They tend to sell faster and for more money just because there are fewer question marks for a buyer,” said Matt Burns. The new plans can also help an outdated and smaller “mismatched house” stand out in a competitive market compared to its neighbors.
This year, the Burns team listed a .37-acre two-bedroom, 900-square-foot cottage with plans and permits for a new five-bedroom, 4.5-bath modern home in a desirable neighborhood near the center of the village. The property, including the plans, is listed at $2.4 million.
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Seller Josh Helfand purchased the property in April 2020 in hopes of demolishing the existing structure in 1986 and building a new home for his family. For 10 months, he worked with his sister, architect Jessica Talley, to design a modern farmhouse-style home with a pool and backyard and secure building permits. When his plans changed, he decided to sell the property along with the plans.
“It should definitely add value to the right buyer,” said Mr. Helfand.
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Turning A House Over With Permissions In Place
Securing permits for a structure can also be a way for home pallets to add value to their investment without having to be involved in the construction process.
In Toronto, Ms. Lasswell sometimes works with investors who buy properties that are demolished, hire an architect to design a new home, complete the permit process, and then return and sell the property and blueprints to a buyer who wants to build it.
In the time it took to obtain permits, the housing market may have also driven up the value of the land, providing the investor with additional gains beyond the value added by the permits.
These shovel-ready properties are attracting a large number of buyers, especially due to the lack of housing stock in some of the high-end luxury markets.
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“Not only do you save time dealing with the city, you also save money in terms of not having to finance a property for six to nine months while waiting for permits,” Shel said. Additionally, buyers can be more confident in their construction budget as they can get started right away rather than waiting a few months when prices for lumber and other materials may change.
As Miss Laswell said: “Time really is money.”
(Mansion Global is owned by Dow Jones. Both Dow Jones and Realtor.com are owned by News Corp.)
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