What People Are Doing If They Can’t Afford Toronto Houses

Market Condition

The housing market in Toronto is cooling and the need for rental units is heading up.

What a change from April!

People were paying almost $900,000 for a typical home in Toronto with no home inspection and the agents were having their commissions slashed.

You can thank the Fair Housing Plan, which had a speculation tax that controlled rent and foreign buyers. The average price per home has tanked in recent months because of this. Currently, the average price in Toronto is $793,915 which is a 6.3% increase over June 2016.

Although the prices are high, there is a sign that price decreases are coming.

Currently, the number of units sold sits at 7,974 in June 2017, which is a 37% decrease over the past year. This means three things:

  • Sellers are over-estimating the value of their home
  • Buyers are being more cautious about home prices
  • Eventually, the high supply and high home inventory levels will drop the average price even further.

While millennial and commuters alike are praying that the Toronto market cools down, what are people doing in the meantime?

Rentals

More and more people are turning to rentals. At fivewalls, a real estate agent search site, they have noticed that there has been a big increase in renters looking to find an agent to help them obtain a rental unit across the GTA.

But there’s bad news.

After the Fair Housing Plan was announced, rental prices grew 11 per cent and surpassed $2,000 for the first time. Vacancies are near zero.

And people are accepting these rental conditions simply because it is slightly better than the terrifying purchase prices in Toronto.

Turnover on rental units has been down, as the average duration of rental units have increased by 4 months to a total of 22 months.

What If I Don’t Want to Live In Toronto… At All?

So what a lot of people are doing now is simply heading west. Not to Mississauga and not to Oakville. Instead, people are now going as far as Kitchener-Waterloo, Cambridge, Guelph and even London. And the prices are definitely reflecting the mass exodus from Toronto.

Currently, an average house price in Kitchener-Waterloo is $465,772, which is 19.8% higher compared to last year’s June.

Good news.

Like Toronto, the units sold are slowly headed down as only 716 units have been sold (3.2% decrease since the past year).

Nevertheless, it’s a place that’s only about 90km from Toronto and you can still buy a detached house for $537,389 on average.

Let’s Move?!

If you want to make the move to a new city, especially if you are used to the vibrant Toronto culture, it can be a huge shift. There are a lot of things to consider and it may become overwhelming and intimidating.

Many real estate agents help their clients with the relocation process. Agents often say that employment, amenities, and the community are one of the largest impacts on a new move.

First question is the lifestyle. There is not a lot of hustle and bustle in these areas, compared to the lively Downtown Toronto culture. Take a road trip and see if you think the different activities (hiking, biking) are a nicer change than Toronto.

Do you think you can handle an hour commute to and from work every single day?

If these factors work for you and you want to find out more, contact fivewalls mentioned above who can help you find an agent to navigate through moving to a new city and escape the Toronto housing prices.

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