For a long time, Toronto real estate had a reputation for constantly escalating – especially post-COVID-19. When interest rates dropped, buyers flooded the market, causing housing prices in the city to break records on an almost monthly basis. However, just a couple of years later, changes to interest rates caused the market to balance out, leaving buyers and sellers in a neutral position where neither side had the advantage.
Today, there seems to be a little confusion about where the market stands, with many people asking “Are Toronto houses still getting more expensive?”
Where Toronto’s Market Stands Today
So, how hot is Toronto’s real estate market right now? Are house prices still trending upward? Truthfully, neither of these questions can be accurately answered with a simple yes or no. Instead, painting an accurate picture of one’s position within the market is completely dependent on a buyer or seller’s personal circumstances.
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A City of Micro-Markets
Right now, Toronto’s real estate landscape looks more like a colourful mosaic or patchwork quilt than a singular entity. Trends are shifting at a hyper-local, hyper-nuanced level. While it was once helpful to look at broad, large-scale trends across the market, adequately understanding buyer/seller dynamics now requires zooming in and studying the relevant micro markets.
Even in a neutral market, the dynamics of a specific area can differ greatly from the city-wide average. For example, one neighbourhood might be experiencing a surge in demand due to new amenities, while another might be cooling off because of construction or other factors.
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How Trends Change Neighbourhood by Neighbourhood
Toronto is a vast city, and its neighbourhoods vary widely in terms of amenities, demographics, and accessibility. Some areas might be seeing strong interest due to proximity to good schools, parks, or public transit, while others might be less in demand at the moment. This localized demand can dramatically affect home prices, competition, and the speed at which properties are sold.
For example, more established neighbourhoods like Cabbagetown, which offer easy access to downtown and access to great schools, might still be seeing a lot of buyer interest. On the other hand, newer, up-and-coming areas like Liberty Village or Regent Park may be experiencing different market conditions, especially as new developments hit the market.
This dynamic is one of the reasons why it’s hard to answer questions about how housing prices are evolving. Demographic, social, and economic differences, no matter how subtle, have a major impact on demand. To that end, prices can fluctuate significantly from one neighbourhood to another.
In some of the more affluent areas, like The Annex or Lawrence Park, home values may remain stable or even increase slightly due to high demand. In contrast, areas with a lot of new condos or development projects might see more modest price changes as supply catches up with demand.
Opportunities For Everyone
Today’s market conditions are unique, however, they’re not entirely unprecedented. As real estate agents who have bought and sold homes in Toronto for several decades, we’ve worked in practically every type of market possible. With this experience in our back pocket, we offer you this good news: you can find success in today’s market whatever your goals may be. In other words, there’s an opportunity for everyone to reach their goals.
What’s the Good News For Buyers?
There are a handful of reasons why it’s currently a great time to buy. When Toronto’s market was red hot, a lot of buyers felt rushed or pressured to act quickly. Now, you’ve got much more breathing room. You can take the time to view multiple properties, weigh the pros and cons, and ensure that the home you choose truly fits your needs. That said, some homes are still attracting competing offers so there may be instances where you have to be quick on your feet – however, it’s much more rare.
On top of this, with homes spending more time on the market, there’s also a little more space for negotiation. Right now, sellers are more likely to entertain offers that come in below the asking price or have different terms. While you may not get a massive discount, you might find sellers more willing to meet you in the middle.
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What’s the Good News For Sellers?
Because Toronto was once known for frequent bidding wars and constantly climbing house prices, some sellers feel like they’ve missed out on their one chance of an amazing sale. However, that’s not the case.
Even though the market isn’t completely skewed in favour of sellers, properties are still selling at fair market value. If you’ve done your due diligence, i.e. working with a great listing agent, prepared and staged your home, priced it appropriately, etc., you can still expect to receive offers close to your asking price. Buyers may be more selective, but they’re also willing to pay for homes that check all their boxes, especially in neighbourhoods where demand is still strong. So, even if it takes a bit longer to find the right buyer, the fact that the market is stable means there’s less risk of your home’s value declining sharply.
Ready to head to the market? As Toronto’s leading real estate experts, we can help you reach your goals. Send us an email or call 416-587-3300 to discover your path to success.
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