Jul 16 | Posted by Barry Cohen

It is becoming almost impossible to talk about the hot Toronto housing market without sounding like a broken record.  Speaking about breaking records, it seems GTA realtors are doing it with each passing month this year.  Whether it’s condos, townhomes or single-family homes, if it’s for sale in this area, it’s likely to sell very quickly and for more money than it would have last month.

A lack of inventory is the main catalyst driving prices up and often creating bidding wars especially for detached homes where the average price has skyrocketed to $1.5 million in the city – an increase of 18.2 percent just in the last year alone.  The number of homes sold in this category is down from last year, largely because there aren’t enough of them for sale, but also with the new price tags they are out of reach for most buyers.

Baby boomers are impacting the market because many of them have decided to stay put and do home renovations instead of downsizing, which directly affects the number of properties available.  This decision also has a large impact on their children, the echo-boomers, who are in their prime home buying years and find themselves with very little to choose from, or in a situation where they simply can’t save enough money fast enough for the initial down payment or qualify for the hefty mortgage payments that come along with million dollar properties.  As a result, the only realistic housing choice left for most young buyers is condos.  

The GTA condo market that was experiencing stagnation is feeling the impact of young and first-time buyers being pushed their way.  Condos are registering the biggest increases in sales of all housing types according to TREB statistics. Condo sales surged by 13.2 percent in May and prices climbed by a healthy 5 percent.  It appears that despite the skeptics who expressed their concern that too many condo units were being built, the number of young buyers, investors and renters has for the most part kept pace with the new supply.

I’m sure you’ve heard rumors on the nightly news about the “Toronto Housing Bubble” and that it has to burst in the near future.  I’m not so sure I agree with that – I’m more inclined to think that at some point the inventory will increase to where it keeps pace with the demand and the market will settle down.  Over the years, I have experienced many of these peaks and valleys in the market, and believe they are a normal phenomenon for real estate.  All it takes is a few consecutive months where listing growth outstrips sales growth to satisfy pent-up demand.

What does all this mean?  Quite simply it means that NOW is an opportune time to list your GTA property for sale while demand and prices are high and selling time is low.  It is almost impossible for a homeowner to know the realistic current value of their home with the market constantly changing.  The experience and expertise of a professional realtor is invaluable when it comes to deciding on the true market value for your property.  I would be happy to meet with you and provide you with a professional, accurate evaluation and a suggested listing price.