Power of sales are increasing across the Greater Toronto Area but are still rare in top-market areas, says Jane Zhang, senior vice-president sales broker, Sotheby’s International Realty Canada in Toronto.

“In the Bridle Path, a top market in Toronto, the country and the world, most owners have significant wealth and financial stability,” she says. “What they don’t have is a mortgage, so they don’t go into power of sale,” a process that allows lenders to sell a property in order to recover funds owed.

There are two reasons a power of sale would come up in these top-market neighbourhoods: 1. financial, likely a failed business or a massive debt that could be due to a huge event like a market crash, and 2. breach of contract, she says.

Lenders prefer the power of sale over foreclosures because the former is quick and efficient. “The lender’s goal is to collect back the money they are owed as quickly as possible. In the Canadian context, the power of sale is chosen more often than foreclosure,” which requires the lender to take ownership of a property and become responsible for all liabilities, Zhang says.

 

Buyer interest and misconceptions about pricing

 

The power-of-sale price is negotiable, as with any sale. However, some buyers are attracted by power of sales, thinking they may get a bargain because “the sale is initiated by a lender and can sometimes be priced lower than a traditional sale as a way to quickly recoup their investment,” she says. “However the lender is obligated to try to sell at a fair market price to be fair to the borrower.”

Regardless of the price of the property, Zhang says it’s important for agents representing the sellers and buyers to work closely with a real estate lawyer who specializes in power of sales, and to get them involved early in the process because there is a strict legal process to follow.

Zhang says she has been in early and constant contact with her real estate lawyer on the power of sale of 45 Park Lane Circle, now listed for $22.8 million (Sotheby’s fair market valuation for the Bridle Path property).

Her client is a private bank with whom she has had a long-term relationship and it trusts her, she says. “The bank came to me. Being trustworthy, accountable and professional are keys to being hired. Bridle Path power-of-sales scenarios involve niche circles, where highly reputable agents introduce their ultra-high-net-worth clients to private wealth managers or boutique lenders, facilitating introductions.”

 

High-end power-of-sale listings require deep trust networks

 

Zhang says agents who are interested can’t just go to the bank and ask to handle their power of sales. “They have to trust you.”

The power of sale is a challenging process for agents regardless of price. “Lower-end power-of-sale real estate representatives also need to have the same qualities,” she says. “A realtor’s own network is important. Who are you? Who do you know?”

Zhang’s power of sale was listed close to the end of November and she says some inquiries have already been received.

Forty-five Park Lane Circle was previously listed on MLS for $29.8 million by the owner in June 2024, then later reduced to $25 million before its most recent $22.8-million price when it was relisted with Zhang toward the end of November.

Zhang says a few streets in the Bridle Path are used as thoroughfares between two main roads, but Park Lane Circle is south of Lawrence and is more secluded. The 2.15-acre landscaped property has a 302-foot frontage.

Features of the Park Lane Circle residence

 

The 14,200-square-foot bungalow has a walkout lower level.

Architecturally, it’s contemporary, California-inspired open-concept layout with a bright interior. It was built in 1985 but fully renovated in 2024, she says.

Highlights include a neutral palette, ultra-premium concrete and stainless steel, illuminated glass, precious stone and a kitchen with quartz islands, a heated floor and chef-worthy appliances. High ceilings, a glass elevator and a lower-level entertainment area with an upgraded theatre, a gym, a steam spa and a dedicated wine cellar are other features.

Zhang says the abundance of glass ensures a connection with the outdoors, making it the perfect mansion for nature lovers.

Walkouts provide an easy flow from the sunny interior, which has an indoor garden and skylights, to the gated grounds. A secluded courtyard, a driveway with a snow-melt system and a private resort-like backyard are noteworthy.

Tiered patios, a pool, a whirlpool, a tennis court and several lounging areas are backyard features.

 

Large Bridle Path estates face longer sales timelines

 

The Bridle Path has more than 100 ownership properties of two or more acres. Mansions that have 20,000 to 30,000 square feet of living space are common.

The sale of 45 Park Lane Circle is expected to take several months because of the rigorous power-of-sale legal process. This property is also tenanted.

The commission is 2.5 per cent for the co-operating agent.

 

Photos courtesy Ryan Fung photgraphy.