As Toronto’s Housing Market Heats Up, There Are Still Great Alternatives
The average price of a single family home in Toronto is now over $1,000,000, which is a 12.7% increase from the year before. (http://www.thestar.com/business/2015/09/04/average-gta-house-price-up-10-in-august.html)
Today’s current housing market in Toronto has been steadily increasing, even throughout recent recessions and a weak Canadian dollar. Though there’s not a lack of space or any particularly high demand or dense demographics, prices have continued to increase and we’ve seen townhomes for $500,000 on the lower end of the spectrum. For many Torontonians, this is a daunting realization but there are options available for those who opt out of purchasing an overvalued new home in the city.
Consider a Renovation
Insanely high purchase prices are one of the main reason home renovations have been far more prevalent within the last 5 years than the purchase of brand new homes. Buyers are opting to fix their own homes, or buy fixer-uppers to later renovate into the home of their dreams. In 2015 alone, Canadians spent approximately $68 billions in home renovations compared to spending $20 billion on the purchase of brand new homes. Be sure to carefully check any contractor you choose to go with. I had a great experience with Georgian Custom Renovations (just a little shout-out, thanks Georgian) but there are no doubt many good companies in the Toronto area.
What Are Your Thoughts?
Do You Think Toronto Real Estate Prices are Over-Inflated and Will Crash?See results without voting
Head to the Suburbs
Heading into the suburbs tends to be one of the go-tos for prospective buyers tired of the high prices within the city’s core. Mississauga, Brampton, Pickering, Ajax and Whitby are just a few areas in the Greater Toronto Area that may not necessarily boast lower prices per se - but definitely gives you more bang for your buck. With similar prices but more square footage and outdoor space, it’s a fair tradeoff for many who feel stifled by the rising prices but small spaces in the city centre. The flipside of this is an increase in commute times if a homeowner works within the city; so it depends on which convenience matters the most to you and your family.
If the Timing's Not Right, Try Renting.
Renting is a viable option for many who don’t have not yet found the perfect home - or who simply life the flexibility of lease instead of a mortgage. Typically, renting or leasing a condo, townhome or detached home will be much cheaper in the moment; only requiring first and last and potentially also a deposit. In the long run, however, you may end up paying more than you would have had you purchased a property. Also, rentals don’t allow you the same freedom of customization that you get with ownership.
Purchase a Rental Income Property
Buying a home with a rental suite (or renovating a basement or attic to accommodate one) is a great way to supplement the costs of your home. Depending on the quality of the rental and your home’s location, it’s possible to ask for a monthly amount that more than covers your monthly mortgage payments, allowing for your home to “pay for itself.” Finding good tenants is the most important part of this plan, so it’s a great option for homeowners who are comfortable also being landlords and property managers.
No matter what option you choose, there are alternatives to purchasing a brand new home; so research a few and find the one that works best for you.
No comments yet.