Is Now a Good Time to Buy a Property in Toronto? 6 Helpful Tips
If you’re a first-time homebuyer or investor considering purchasing a property in any Toronto neighbourhood, you’re probably asking yourself a crucial question: Is now a good time to buy a property in Toronto in 2023? Let’s delve into the current real estate market trends to provide a clearer picture.
Understanding the Current Toronto Real Estate Market
As of April 2023, Toronto’s real estate market is witnessing strong sales colliding with tightening supply. This clash has contributed to an increase in home prices, with the average Greater Toronto Area (GTA) home price at $1,153,269, a 4% jump from the previous month and the highest it’s been since May 2022.
After a 23-month low in January 2023, there’s been a significant bounce back. Although GTA home prices remain 8% lower compared to last year, they show a substantial recovery from the 15% year-over-year decrease observed in March 2023.
GTA Real Estate Sales and New Listings
GTA home sales are also on an upward trajectory, with 7,531 homes sold in April 2023, representing a 6% year-over-year decrease, but a massive improvement from last month’s 37% year-over-year drop.
However, new listings aren’t following suit. They’re down by 38% year-over-year, with only 11,364 new home listings. This has pushed the sales-to-new-listings ratio (SNLR) to 66%, indicating a seller’s market where homebuyers compete for fewer homes. This increase in competition can nudge prices upward, benefitting sellers but making it tougher for buyers.
Toronto Real Estate: Regional Comparison
A regional comparison highlights interesting differences. The City of Toronto saw its average home price increase by 6% compared to the previous month, hitting $1,120,352 in April 2023. Brampton also experienced a 6% increase, outpacing Mississauga’s slower 4% growth. It reminds us of Brampton’s dramatic rise and fall in 2022. In contrast, York Region, Halton Region, and Durham Region all saw a 2-2.5% month-over-month increase in home prices.
Property Types in Toronto
Looking at property types, all are experiencing year-over-year decreases in average prices. The average price of a detached home was $1,489,258 in April 2023, a decrease of 8.5% year-over-year, while condo prices dropped 8% year-over-year. Notably, freehold townhouses, with an average price of $1,093,560, are inching back towards positive year-over-year price change territory, a significant change for Toronto’s housing market.
What Does the Future Hold for Toronto Real Estate?
When asking the question, is now a good time to buy a property in Toronto, predicting what will happen to real estate in 2023 isn’t straightforward. However, some key indicators offer a glimpse. The Bank of Canada’s pause in rate hikes could provide relief in borrowing costs, potentially supporting a continued recovery. But a lack of new listings might push prices higher.
The average sales price to listing price ratio was 103% this month, meaning homes sold for 3% over their asking price, a sign of a competitive market. It’s higher than the 101% ratio seen last month, making it the first time the ratio exceeded 100% since May 2022.
Is Now a Good Time to Buy a Property in Toronto in 2023?
Given the current trends, buying a house in Toronto now depends on your individual circumstances. Despite the rising prices and a shifting market favouring sellers, there are still opportunities for savvy buyers. A keen understanding of the market trends, along with careful financial planning, can make the journey smoother.
In a competitive market like Toronto’s, knowledge is power, and staying updated with the current trends can help you make an informed decision.
At the end of the day, the decision comes down to your personal circumstances. Is now a good time to buy a property in Toronto? Toronto’s real estate market is like a roller coaster right now. But with the right knowledge, careful planning, an experienced realtor, and a little bit of luck, you might just find your dream home.