August 27th 2021
City Real Estate: Toronto Homes for Sale
By Arthur Favier
A deep dive into the Toronto real estate market
Toronto and Vancouver have always been neck and neck when setting the bar for consumer demand in the Canadian real estate market. As two of the country’s three largest cities, they’re popular places for people of all ages, backgrounds to settle down. There’s only been one reason people second guess themselves when purchasing Vancouver or Toronto homes for sale: price.
A hefty price tag comes alongside all the cultural, economic, and entertainment benefits of living in a major city. The demand for property in cities like Toronto is so great that real estate now constitutes a significant chunk of the overall Canadian economy. Despite the steep price, people by and large still prefer city life. Or at least they did…before the COVID-19 pandemic.
The pandemic impact
While the rest of the Canadian economy struggled to adjust in the madness of the economic restraints put in place by the novel coronavirus, the real estate industry is proving once again to be the bedrock of financial activity in Canada. However, the threat of the contagious virus, and the add-on effects of rolling lockdowns and drastic lifestyle changes are causing people to reconsider where they live — both in terms of structure type and geographic location.
Condo struggles are real
Two of the major economic victims during the pandemic, in real estate terms, were commercial property and condominiums. While the former has faced obvious challenges due to the widespread closure of businesses (particularly small businesses), the latter is facing difficulties due to a paradigmatic shift in the importance of personal space. As people in more rural areas have enjoyed relative safety and less restricted movement during lockdowns, those in condominium buildings continue to experience isolation, a much more sedentary lifestyle, and additional regulations imposed by condo boards.
Coupling these struggles with the additional factors of widespread remote work and a mass exodus to suburban neighbourhoods and satellite cities, it’s not hard to see why the condo market in Toronto has experienced large-scale disruption. Over the first two-thirds of 2021, improvements in the number of COVID-19 infections, the rollout of vaccines, and borrowing rates see many industries rebound, and the condo market appears to be one of them. However, there’s no question that demand for these structures is shaken in the wake of recent events.
Buying a house in Toronto
A monumental task in standard times, buying a house in Toronto seems nearly impossible for those who don’t have high salaries, multiple incomes, or vast financial support networks. The popularity of Canada’s largest city and all the great amenities and experiences it offers have driven the highest demand and home prices in years. But even the mighty residential market for freeholds and semis in Toronto is feeling the impact of pandemic-related changes.
While the total demand for homes within the GTA and surrounding areas remained high throughout the pandemic, the geographic locations experiencing the most demand has changed. Reports from earlier this year found that over 30% of surveyed real estate purchasers during the pandemic bought in areas that they “would not have considered before COVID.” The major reasons for this decision being skyrocketing prices, a desire for freehold homes, and more outdoor space.
Simply put, people now value different aspects of real estate than they did prior to 2020. Coupling that with the traditional difficulty of buying a home in Toronto, it's not hard to see why people are migrating towards the Toronto suburbs and other areas of the GTA.
Neighbourhood assessment: Toronto real estate
While demand has certainly shifted in the Toronto real estate market (for now, at least), there’s no question that it remains a popular destination for investors and residents alike. It’s simply a shuffling of neighbourhoods experiencing the most demand. While all market segments are performing well, here is an analysis by our expert real estate analysts at Properly as to which communities are the relative winners and losers in the current Toronto landscape.
The winners: GTA suburbs
A comparison between average pre-pandemic sale prices and current price estimations shows that buying a home in the GTA suburbs is more popular than buying a home in Toronto right now. Areas to the East of the city, like Oshawa, Clarington, and Brock, are experiencing price increases greater than 40%. There’s a similar, albeit slightly smaller, increase occurring to the West in places like Halton Hills and Caledon. This data perfectly coincides with other reports of consumer migration towards less expensive properties that afford more space and greenery.
The runner-up: Toronto
It’s difficult to call Toronto the “loser” in this situation, seeing as there is still a 16% increase in the average sale price across the city over the last year and a half, as well as renewed interest in buying a house here. But it’s clear that the stranglehold this metropolis has on the real estate market is weakening. As condos begin to show a resurgence in demand, it’s unclear whether the benefits of buying a home in Toronto will be able to fully recover from the value of more affordable, quality options that sit just outside the city boundaries.
Finding Toronto homes for sale
Finding homes for sale in Toronto that fit within the parameters of your needs and financial reality is still a difficult process, no doubt. Even with people beginning to move towards the suburbs and satellite cities, there’s unsurprisingly much demand for property in Canada’s largest city. Neighbourhoods like Alderwood, Rosedale, Yonge-St. Clair, Moss Park, and the Annex continue to peak buyer interest.
For buyers still interested in securing a condominium or home in Toronto, it pays to partner with real estate professionals that leverage the tech power of enhanced analytics and machine learning to stay on top of the constantly changing markets in Toronto, the GTA, and beyond.