In spite of the ongoing pandemic, Toronto’s housing market continues to boom. While activity has slowed slightly due to lockdowns and stay-at-home orders, home sales have increased by over 300% since April of 2020.
But where is the market headed now? What can home buyers and sellers expect, and what are their best strategies at this time? To find out, we interviewed Toronto real estate agent Ajay Gohil, a longtime resident of the Toronto and York Region. Mr. Gohil is a licensed Realtor who uses his marketing expertise to gain maximum visibility for his clients’ listings.
EM: The Toronto housing market has had a huge amount of activity over the past year. Where do you see the market heading in the next couple of years?
Ajay Gohil: I anticipate the market continuing to be very strong in terms of sales volume and appreciation, even more so as the economy gradually re-opens, along with travel and immigration.
We’ll likely see the continued development of cosmopolitan metropolises or “mini Downtown Toronto’s” across the region, like we’re seeing in Vaughan and Mississauga.
But what we really need is greater supply and affordable housing to help balance the market for all Canadians.
EM: Based on the current Toronto market conditions, should home buyers and sellers act now? Or should they wait until later?
Ajay Gohil: Despite a global pandemic, property values have continued to soar and the mortgage “stress test” rate has recently increased. Therefore, waiting to buy may hold very little benefit, unless it means, for example, being able to save more for a larger down payment.
Sellers are currently benefitting from the impact of low supply and high demand, so it continues to be a perfect time to sell.
EM: You’ve said that properties for sale in this market may receive dozens of bids. How can buyers maximize their chances of a successful bid?
Ajay Gohil: Firstly, review your finances with a mortgage advisor/broker and obtain a mortgage pre-approval (unless you’re a cash buyer).
Go in with your best offer, as there may not be an opportunity to improve it, however, stay within your budget.
Sellers prefer a clean offer, i.e. one with the least amount of conditions (or none at all) and where the buyer can accommodate the seller’s preferred closing date.
Put down a larger deposit, i.e. greater than the typical 5%, if possible.
EM: Should buyers consider a pre-construction or resale property?
Ajay Gohil: According to a report recently published by the Ontario Real Estate Association (OREA), 69% of buyers are more interested in resale properties than pre-construction – about a 1% increase from last year.
Despite this, we’re still seeing new build projects selling out fast, particularly for detached and townhouse projects. Benefits include staggered deposit payments, value appreciation during the construction phase and that distinctive new home feel. Explore the pros and cons of either option with your real estate professional.
This article is opinion and not a substitute for professional advice. Disclaimer