If you are home shopping for a home in Toronto this week, here are the price tags you can expect to see:
- $536,404 for a new home in Toronto (Source: Canada Mortgage and Housing Corporation)
- $384,605 for the average Toronto resale home (Source: The Toronto Real Estate Board)
Toronto resale homes are still priced well below Vancouver homes, where the average price is $535,598. Toronto home prices are just below those in Calgary, where the average price is $390,599.
If those prices are too rich for your blood, try Windsor or Oshawa. These are the areas most likely to advertise many homes at cut-rate prices, because auto sector workers have recently lost their jobs.
Don’t count on readily picking up a distressed property for a song this week without much searching, because there are only 20,000 to 25,000 Canadian residential mortgages in arrears 90 days or more, which represents 0.27% of all home mortgages (Source: The Canadian Association of Accredited Mortgage Professionals). This percentage is substantially less than it was during the last big recession of 1992, when the default rate was 0.6%. By contrast, the U.S.A. has a default rate of 22%, of which 4% are prime mortgages (those with a down payment) and 18% are subprime (with no down payment). Your mortgage broker might be able to find you a distressed vacation property in the southern U.S.A., if you have at least a 30% down payment.
If you are selling a home in Toronto this week, know that Ted Tsiakopoulos, the Ontario economist for Canada Mortgage and Housing Corporation, predicts that Toronto homes will not be devalued, but will not appreciate in price as quickly as they have been. Toronto homes will likely appreciate steadily at the rate of inflation, so the housing market will be balanced and prices more reasonable. Last year, a record 93,193 homes were sold in Toronto. Mr. Tsiakopoulos predicts sales will fall to 79,000 – the level of 2003 – because of slower job increases and lower demand for housing. If you list your home today, expect to sell it in 36 days, which is about a week slower than it would have sold in the spring.
