It is a relatively balmy Friday night. You and your significant other are walking through crowded King Street West. You can hear different types of music emanating from windows. There seems to be a party everywhere. While there is excitement brewing in the air, you are taken aback by the intensity. It is as if the entire neighborhood is going through intensification…
The dictionary defines intense as “existing or occurring in a high or extreme degree” or “acute, strong, or vehement, as sensations, feelings, or emotions.” Can a neighborhood be considered intense? Can an entire city be acute, strong or vehement? Yes, a neighborhood and city can be intense, just not in the way you think…
The Greater Toronto Area is experiencing many interesting developments in its housing market in recent months. Housing of all kinds is increasing in value, although some housing styles are increasing faster in value than others. Staying on top of the latest trends can help you ride the wave of greater wealth.
Discussions on the real estate market in and around Toronto have focused on the idea of intensification. Intensification refers to the amount of homes sold compared to the residential capacity of the building. In Toronto, there were only 11,082 home sales during the first five months of 2013, the lowest total of home sales in the GTA region since 2009, during the global financial crisis.
However, while home sales have dropped across the board, the percentages have been tipping in the favor of high-rise housing. Sales for low-rise housing were a whopping 43 percent lower than average, while high-rise housing sales only dropped by 13 percent. During the month of May, the average price of a re-sale high-rise home hit $370,000.
All of this intensification of housing has created a difficult situation for some homebuyers, though. The fact that housing sales are down, but that the price per sale has risen, means that first-time home buyers often have to take on more debt to afford a residence. Mortgage rates dropped through the floor during the financial crisis, but have slowly begun to rise at the same time that stricter lending criteria has made it more difficult to acquire financing.
Knowing how to navigate the intensification of housing and obtain a reasonable mortgage can help you rise above the rest of the pack; whether it is a condominium unit or a condominium development site. Call Janterra Real Estate Advisors when you want the best information on current trends in the Toronto real estate market.
Are you ready for Toronto’s intensification?
*Image courtesy of Songquan Deng