August housing stats in August were NOT business as usual!! August is usually a lull month for sales, but this August was record breaking and anything BUT “usual”. Is this our “new normal”??
For the FIRST TIME since we’ve been tracking sales in the GTA:
1. We have less than 2 months of inventory.
2. The average sale price of a detached home in CENTRAL Toronto is over $1.7ML
3. The average sale price of a CENTRAL Toronto semi-detached home is around $900K
4. Despite rising prices, these higher ticket homes are selling even faster…15% faster than last August and prices are 10% higher than last August!
DILEMMA:
A) Condo sales are booming, so first-time buyers have some opportunities for home ownership here. But if condo couples want to leverage their equity in their condo by selling and move into the “growing family” house…how can they afford to step up, when the average detached home is now LUXURY priced! Even if they qualify for a mortgage, look at the DOWNPAYMENT that has to be paid to avoid a high risk mortgage!!
B) Both semis and detached home sales have been sliding month after month in the city. Older home owners who WANT to sell their large family homes cannot find smaller homes to purchase for downsizing or smartsizing.
I asked a few of my clients who are faced with these problems what their thoughts were on this heated market of ours and this is what they are considering, and so are their friends….
CASH OUT in Toronto and MOVE to the “burbs” (where there is supply AND only one land transfer tax!). One client who desperately wanted to stay in The Danforth, has finally decided to move to Oakville. Why? A detached property with a lot size 20 x 100 feet costs them $1.3++. A similar detached home in Oakville sits on a 55 x 150 foot lot and costs $1.1ML….more bang for the buck and the compromise is the COMMUTE. PS: for the past several months, 65% of TREB sales have come from the 905 area code and NOT from the city…
Another client has decided to CASH OUT in Toronto, sell her large family home and rent….until the market cools. And yet another, will CASH OUT in Toronto and purchase a great condo to simplify her living….and thankfully there are lots of choices for comfortable condo living. PS: 65% of condo sales in the GTA take place in downtown Toronto.
So, perhaps CASHING OUT will help YOU “beat the heat” in Toronto. It will help replenish the ACTIVE LISTING supply and contribute to a return to a balanced market and moderating prices. BONUS: you will be considered a “good citizen” to boot!
Allow me to counsel you on the best route for YOUR Real Estate decision journey. How can I help YOU today!