You must be wondering why I say so, when we are hearing from many economists that the GTA’s local real estate will crash this year and prices will fall down?
Here are the few facts I would like to bring here to support my predictions:
1. More Affordability – The average price of 1990’s vs today is almost twice in most of the GTA areas. Whereas the interest rates of 1990’s (around 12%) has decreased 4 times down to around 3% now a days. The average cost of living that time was same as it is today. Further, in those days a two bedroom condo could be rented at $ 1,100-1,200 vs today it is around $ 2,200. So economically speaking it makes more sense to buy vs. rent.
2. Single Percent Degree Price Increase – The housing prices increased by single digit percent increase in most of the GTA area for many years. Which is also not considered as big bursting bubble and is healthy in my opinion.
3. Consistent Immigrants Inflow – For almost a decade, the consistent immigrants inflows into Canada and especially in Toronto and surrounding areas makes it rising demand of homes by these settlers over the year. Low interest rates and almost similar cost of renting vs. owning makes more sense to own a house. Also, most people understands the value and benefits of owing a home.
4. Consistent Rent Increase – Rents are almost double now then they used to be in 1990’s, making it more sense to buying then renting.
5. Least Effect of Changes in Mortgage Rules – The effect of lowering the amortization period to 25 years if you were putting less than 20 per cent down and lowered the percentage of your income that could be used for borrowing from 44% to 39%. The result was that buyers who would have purchased in late summer or fall moved up their purchasing decision to the spring. By fall, this meant many would-be first-time buyers were looking to rent instead of buy. This contributed to low vacancy rates.
6. Good For Investors – Toronto condo and homes rental vacancy rates are less than 2%. Their is plenty of demand for housing or condos by renters and low borrowing cost and bringing higher return makes it more attractive for investors to invest in the housing market.
7. Interest Rates In The Future – They are expected to be same for little while from now as the U.S. Federal Reserve is now saying it won’t raise the rates until 2015. We can’t afford to be differ much from theirs without harming our economy with a strong dollar and slower growth.
8. Strong Canadian Automobiles & Servicing Industry – Resulting More jobs and better economy in the future.
9. Strong Prices in 2012, Up by Almost 7% – Even though the slight down in number of total sales for 2012 amounted to 85,731 – down from 89,096 transactions in 2011, But the average selling price in 2012 went up by almost 7% to $497,298, inspite of mortgage rules and negative predictions.
So cheers and look forward to have a place of your own called – “Your Own Home”!!!
And being an experienced full time Realtor, I shall be more then happy to help you in fulfilling your dream to have a little piece of your own on this earth. If you have any questions, then I can be reached at (416) 400-7785 or email me at firstname.lastname@example.org.