In Toronto’s Hot Housing Market, the Inner City and Condos Still Offer Upside Potential – Mansion Global

December 17, 2021 by No Comments


Toronto was already simmering before the advent of the pandemic, but the past two years have sent prices soaring amid feverish home buying in the Canadian city.

Prices across the greater Toronto area have risen by 22% in the past year, with the price of detached homes in the suburban areas of Toronto, known as the 905, experiencing 33% growth, according to data from the Toronto Regional Real Estate Board.

Still, potential buyers can hedge their bets against the possibility of a real estate bubble by looking to neighborhoods with less frenzied price growth, like the city’s downtown core, as well as its condominium and townhouse market.

“The prices in the surrounding areas of Toronto have been rising higher than the city,” said Cheryl Thompson, a real estate broker with Sotheby’s International Realty.

Outline Financial, a boutique mortgage and insurance brokerage, has been keeping track of home price growth around the Golden Horseshoe.

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“If you want to see any region that has benefited the most from Covid, it’s Durham,” said Outline’s Managing Partner Jason Lang, referring to the municipality that encompasses Toronto’s eastern suburbs.

Buyers have turned to the region’s larger properties to accommodate remote working, while supply has stayed limited, resulting in the average prices in Durham for detached homes growing 34.2% from October 2020 to October 2021, to C$1.1 million (US$860,000).

Similarly, in Simcoe County located just north of Toronto, prices for detached homes have increased 31% this year, to C$1.05 million.

While these regions might be leading the Golden Horseshoe’s growth, the rapid increases in home prices during Covid-19 are an anomaly. Over the past five years, detached-home prices have risen but at a considerably slower pace of around 8% each year, according to Outline’s data.

Exurban areas may be some of the first areas to feel shifts in the market. That was the case for Simcoe and Durham during the Canadian housing market’s last slowdown, in 2017. Now, as Toronto returns to pre-pandemic conditions, the exurbs might again be the first to see price growth slow, especially as workers are called back to the office and commuters start looking for homes closer to the city.

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Potential buyers could consider Toronto’s inner-city neighborhoods, where prices have risen less dramatically.

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Source: https://www.mansionglobal.com/articles/in-torontos-hot-housing-market-the-inner-city-and-condos-still-offer-upside-potential-01639743358

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