BY MAURICE ANDERSON
HAPPY NEW YEAR! We made it. Canada went through a lot last year. From the wildfire in Alberta that destroyed over two thousand structures, nearly ten percent of the city and demolished acres of natural forestry to British Columbia’s real estate reform. Toronto’s real estate market was definitely not an exception. Month over month last year starting from January to December there was an increase in home sales. Home buying activity remained strong across all market segments throughout the year. One of the strongest months last year was November when home sales increased by 16.5%. The home price index rose to 20.3% compared to November 2015.
Toronto possesses real potential to come into its own like never before.
International and local investors realize Toronto means they can live in a world class city with New York traits, without the New York price. Though the government has implemented new regulations to try and stabilize the rapid increase in price it will not slow down the market as much as they expected. The municipal government implemented these changes in real estate to maintain the strength in the real estate market thus reinforcing the strength in our economy by adding a “stress test” in the pre approval process.
In turn, it makes it harder for first time home buyers to enter into the market due to the strenuous financial competition. As a result, many buyers are having to experience multiple offer situations caused by the lack of homes for sale which is also a direct result of the lack of supply of land. Canada (9.985 million km2) is a vast country, bigger than some countries, such as U.S.A. (9.834 million km2), and continents, such as Australia (7.692 million km2). Numerous regulations are in effect to protect forestry. Conservation areas have been proven to be important for our agriculture and ecosystem but if the government approved the use of some of the land it would relieve some of the selling power given to homeowners when putting up their property for purchase and sale. New developments would be available closer to the city and at an affordable price. Sellers and buyers would mutually benefit.
As it stands, if a homeowner was to successfully sell their home and wants another home of the same caliber in regards to square footage, bedrooms and lot size in another neighborhood they may end up paying more. Unless they are willing to downsize, depending on which neighborhood they’re moving
from. In a seller’s’ market, a home is listed and sold typically within thirty days, with multiple offers and sold over asking. The buyers’ may choose to “bully offer” the sellers’ to acquire their dream home by putting in an offer prior to the offer presentation date or will have to continue looking.
A recent toll (14,096 votes approximately) conducted by the Toronto Star stated that 36.98% of the voters agreed that they do not need any more expenses to commute to Toronto via Gardiner Expressway and the Don Valley Parkway. In addition to the road toll changes city council is also trying to approve new Land Transfer Tax regulations for Toronto. For these reasons to name a few, more people will continue to move out of Toronto because of the continuous rising costs from all avenues.
New developments allow buyers another option. They have the ability to purchase a new home at a reduced cost while saving money and increasing equity during the interim until their home is finished being built. Security is also given to the buyer in the form of the Tarion home warrant program. I have had clients in the past who have gained one hundred thousand dollars and more in equity from when they purchased their home outside of Toronto using my services through the VIP Broker pricing I have access to. The real estate industry showed unexpected growth at a rate unprecedented in our history in 2016. This year will be no different. Buyers are trying to get into the market before it’s too late. Sellers are trying to make a substantial profit with the momentum currently established. Real estate is simple to an extent. Buy low and sell high.
