Real Estate Reflections ~ Why Toronto real estate still remains HOT ~ VL Mt. Pleasant Edition
Regardless of the time of year, real estate remains a hot topic. Take the summer of 2013, for example. What is typically a slower time of year, has once again proven to be warmer than the weather. Once again July experienced an increase on values and over 20 percent more sales than this time last year. Values in the summer show a three percent increase over last year.
The government has done all it can do to try and cool a market that has been on an upward swing for over 15 years. Just some of the changes implemented are:* Amortization periods have been brought down to 25 years from 40 years. This increases the monthly mortgage payment. * The minimum down payment has been increased. More money needs to be saved before a purchase. * The percentage permitted to borrow in comparison to value has been lowered and especially for homes over $1 million. Banks have really tightened their lending rules. * The government has tightened how much the banks can insure. This means that banks now scrutinize who they lend to. Yet homes are briskly selling and even multiple offers are still happening on some homes that are smartly marketed. Will this end? If so, when? What is driving the market? There are many positive indicators that we can share: * The interest rates are still and will remain at record lows. * Available supply of homes are and remain at an all time low. There just aren’t enough homes for the demand. * More people are renovating instead of moving. This adds to a supply issue for interested buyers. * More immigrants are choosing Toronto as home. These are families with wealth and value desirable neighbourhoods with great schools. * More people are choosing to pass on the commute and live closer to where they work. Saving on this expense allows for extra money to invest in a home.
When the year comes to a close, 2013 will be remembered as another fantastic year for real estate. Sales growth and results are proving that buyers are still very active and competing for the homes that do come on the market.
If you’re sitting on the sidelines waiting for a correction, the numbers and data prove this is not about to happen, especially not in 2013. I’m just stating the facts…..no doom and gloom here.
Tim Syrianos is the Broker of Record and Owner of RE/MAX Ultimate with close to 200 Realtors in Leaside and Central Toronto. email@example.com