If you’ve been watching the Toronto real estate market closely, you may have noticed some atypical trends: homes selling for a significant percentage under asking, properties available for several weeks, buyers negotiating favourable terms. For buyers, it’s a welcome change from the market they saw and experienced leading up to 2017.
The market is definitely more balanced than it was, and it is presenting some great opportunities for those actively looking for a new home. In the last several months, our clients have purchased several properties that were well beyond their initial expectations and with terms that made the process far less stressful.
The key question is – will it last?
Based on the recent 2020 Housing Outlook generated by the Canadian Mortgage & Housing Corporation (CMHC), home prices across the GTA are predicted to rebound in the next two years, rising as much as +5% in 2020. By 2021, average prices could rise by as much as +11%.
Housing sales are also anticipated to increase to between 83,400 and 92,400 next year, up from between 79,400 and 86,985 this year. Strong migration into the GTA, coupled with a robust labour market and lower than anticipated interest rates are the driving forces behind expected sales and price increases over the next two years.
According to UBS AG’s annual global real estate bubble, Toronto ranks #2 among the world’s most overvalued housing markets. That being said, the bank has also stated that “a major price correction seems unlikely in the short term given improving mortgage conditions, a weakening Canadian dollar and falling supply.”
Over the last ten years, average sale prices in Toronto have consistently rebounded from any brief dips. The market has typically rebounded quickly from any price dips, moving to even higher prices than those preceding the drop.
No one has a crystal ball, but what we can say is that this more balanced 2019 market has been favourable for our buyers. If you've been waffling on whether now is the right time to make a move, you could be missing an opportunity. If the CMHC prediction turns out to be correct, buying a home in 2020 or 2021 could cost you more than it will today.
To learn more about the great opportunities out there and hear about our many recent success stories, get in touch. We’d love to hear from you.