Storm wreaks havoc across the region,
Major challenge for GTA buyers remains condos
Take-no-prisoners atmosphere in housing market now mellowing, but condos still hot property,
How much heat buyers and sellers experience this spring will depend on the kind of property and the area in which they are trading. Downtown If there’s a heat island in the GTA, it’s downtown, where properties are routinely getting snapped up, Desmond Brown of Royal LePage says.
Brown reports that the take-no-prisoners atmosphere of 2016 and early 2017 has mellowed. Even in competing bid situations, the selling price for houses tends not to be a crazy amount over asking and there’s frequently room to negotiate.
A buyer on one property that had multiple bids had a successful offer that included a home inspection, he says. Financing conditions can also be written into offers. Still, he advises, if you’re buying, “You’ve got to do your best to have the cleanest offer possible.” That can mean arranging a home inspection before the offer date or asking for one the seller has done in advance. Buyers should also make sure their financing is pre-approved, he says.
It’s a real estate cliche, but it really is all about location, and that’s truer than it was during the peak, Brown says.
“Last year, where we were seeing things selling in just about any location. This year, buyers are a lot more discerning,” he says. They will pay attention to the condition of neighbouring homes, and properties on main streets will take longer to move.
“A lot of young people in financial services and the tech industry have the money to spend. They want to be within walking distance for work or a short transit ride, and they’re still paying top bucks,” Brown says.
The $1-million price that would be a psychological barrier doesn’t apply to the hot downtown market, says John Pasalis, president of Leslieville brokerage Realosophy.
“Prices of $1.3 million, $1.5 million — those are still competitive down here — if you’re on the subway line,” he says. “It’s when you get north of $2 million that it starts getting slower.”
The 905 The pain of the real-estate bubble lingers in the communities outside Toronto, particularly in areas such as York Region where speculation played a big role in driving up the market before last April, says Realosophy’s Pasalis. Overall, he’s expecting a balanced market, but the farther from the core you are, the more inventory there is, he says.
In Durham Region, one of the most affordable areas of the GTA, the average price rose to $598,000 from $578,000 between January and March, says Dennis Roberts, president of the local real estate association. The average number of days on the market has dropped to 18 from about 30 during the same period. The extension of Highway 407 and expanded GO train service are raising Durham’s value.
Lower-priced properties are moving faster than bigger houses, and empty nesters have fewer options in Durham, where condo development has lagged behind other areas of the GTA, he says.
“They really don’t have many options of where to go. So we need to get a bigger choice for them. We need more supply for that bungalow-condo market, larger condos. They don’t want to go down to 800 square feet,” Roberts says.
Mississauga and Oakville are starting to climb back out of the January doldrums, but the heat generated in downtown always takes a while to work its way west in the Toronto region, Tracy Nursall of Sage Real Estate says.
Increasingly, buyers in 905 communities are looking for the same kind of destination neighbourhoods that make downtown Toronto attractive, Nursall says. They will be quick to pounce on the new neighbourhoods being built around Port Credit in Mississauga, she says.
“Hamilton’s taking a lot of eyeballs because they’ve got a great culture and foodie scene,” Nursall says.
Condos Condos are the housing market that uniformly evoke superlatives and challenge buyers. It’s not unusual for a downtown condo to draw 10 to 15 offers, Christopher Alexander of Re/Max says.
“The condo market just continues to defy expectations,” Andrew Harrild of Condos.ca says.
Multiple offers and over-asking prices are the norm. But, he says, supply is an issue as condo owners struggle to make their next move.
Downtown condos also offer a lifestyle their owners value, Harrild says. He recently met with a couple who were considering listing their downtown loft, but were struggling with whether they could stand to live farther than a two-minute walk to the stores and restaurants they enjoy. “If you want that patch of grass, are you willing to sacrifice on location to get it?” he says.
Royal LePage’s Brown calls the condo market “completely nutty on everything under the $700,000 range.”
Once the price approaches about $800,000, condos start to look expensive. Add in maintenance fees and the cost resembles a $1.1 million house, he says.
Brown cites a condo in Regent Park that was listed for $455,000. He figured it might be worth up to $550,000. It sold for about $600,000 after attracting 13 offers.