It’s Getting hot, Eh? Toronto’s Real Estate Market Refuses To Cool
When many Americans threatened to relocate to Canada if Donald Trump gets elected, it wasn’t just a joke. Canada’s immigration actually experienced delays being overloaded with site traffic, possibly from worried liberals seeking refuge to the North.
If like these peeps, your escape plan for a better future involves moving to Canada’s hottest city, Toronto, then this little news nugget may leave you dejected—Toronto’s now Canada’s hottest real estate market. According to the real estate grapevine, the city’s home prices and sales show no signs of slowing down since august with 9,813 homes sold and a 23.5 percent rise in sales since 2015.
This crazy climb in sales has increased the average selling price up by 13.6 percent compared to last year. Estate agent Christopher Bibby of Sutton Group Associates Realty observes, “I’ve never seen such an aggressive market.” Bibby says that buyers who got a whiff of his plans to list a townhouse in the Annex neighborhood of the university area are pursuing the home even before it hit the market with an estimated $1.2 million price tag. A one-bedroom condo in Toronto’s downtown area that sat on the market for 90 days last fall with no potential buyers, sold this spring for $620,000. A far cry from last year’s immobile market, other agents were urging Bibby to hold off on the final sale for the condo, so their clients could compete with a counter offer.
So what’s contributing to this astronomical growth in graph other than the Trump effect? The continuing rise in real estate prices has been partially fueled by historically low interest rates—BoC overnight is ½ percent and Bank prime is 2.7 percent. Matters are definitely looking up on the economy side of things with the country’s new prime minister, Justin Trudeau. As for Toronto, it’s easily one of the most cosmopolitan cities in the world, with a heavy influx of foreign money and investors.
The real estate market results from early this year have even debunked some anticipated effects of the federal rule-change applied in February. The new rule meant that buyers in the $500,000 to $1- million range had to come up with a larger down payment to qualify for mortgage insurance. Even this stipulation hasn’t deterred buyers from investing. Sales leaped 16.2 percent compared to the same month last year.
Bibby says the market is so competitive that, “many ask if they should count on paying $ 150,000- $200,000 above asking price, to them that is normal.” This over zealous attitude is one of the reasons the average price of a detached home in the Greater Toronto Area reached $910,375 by the end of March this year. Toronto Real Estate Board officials think that the favorable economic conditions in Ontario, low interest rates as well as a shortage of listings attribute to the scorching Toronto area market. So, regardless of where you lie on the political spectrum, if you decide to move to Canada—especially Toronto—be ready to draw daggers, their bidding wars can get brutal.
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