Why is Toronto Real estate so expensive? For instance, you can purchase this beautiful Victorian house in North Toronto for 1.8 million. Well, that’s just a shed, but you get my drift.
I am Trev, and I write about anything that comes to my head in the morning when having my 3rd cup of coffee.
Now, at 40 years old, I remember being 18 – the good old days. My sister asked me if I’d accompany her to check out a new condo development happening in Etobicoke, Ontario. She was interested in buying an investment property to make some dinero.
It was just over a whopping 500 square feet and the asking price was somewhere around 100k. At the time, it seemed expensive as nobody enjoyed the thought of buying a shoe box for a hundred k with some crazy condo fee attached to it.
She decided that it was not a good purchase. My thoughts were equal. However if she actually bought two of those expensive shoe boxes, she would have been UP in 2021. Up a lot.
Here are a couple of reasons why Toronto real estate prices have shot up more than a heroin addict in recent years.
1. The Economy
Toronto has a thriving tech sector and companies are setting up shop. Pinterst, TikTok are just a couple big names among many that have made Toronto part of their business landscape. And thanks to our good friend D.Trump, instead of skilled immigrants heading to The States to live, they chose or were forced to choose Canada.
The average house in Canada costs an average of 500k. In Toronto the average house is about a million bucks. Vancouver and Toronto have the highest real estate prices in Canada, as you all perhaps know.
Aside from Tech, Toronto has an abundance of restaurants, hotels, and events. Jobs, jobs, jobs. The list goes on and on. With manufacturing in and around the city at no shortage. Take Oakville, Ontario and the Ford Assembly plant that employs thousands of grumpy factory workers.
2. Greedy Capitalists
Sellers, agents, and let’s not forget our good friends the bankers, might simply want the most cash possible.
Sellers (Husband and wife or non-binaries) evaluate a house and say,”Honey, do you think we could get 1.4 million for this 2 bed 1 bath bungalow?” The wife, husband or custom agrees.
The Real Estate agent also agrees to this inflated house price because 5 percent of over a million is a desirable chunk of cash for simply taking a few pictures and having some meetings.
The banker is pleased with the process because the next buyer of that property will have a mortgage until they’re, well, dead. With total interest paid over a 25 year mortgage in the ballpark of, let me check my calculator. It just broke with all those zeros.
Look, Toronto is a world class city. The NYC of Canada. Are the housing prices worth the cost of investing in Toronto real estate? Possibly. Could there be a housing bubble and it could pop one day? Interested in other options aside from Toronto?
Here is a city just outside of Toronto that could be a great alternative to live.
This is my number one choice for places to live outside of the T Dot. According to a Narcity article, Burlington is officially the best community to live in Canada.
Burlington has also been voted as the number one spot for mid-sized cities to live in Canada by the annual MoneySense Report.
Burlington by the lake is a breath of fresh air. Unless a polluted wind is coming in from the city of Hamilton next door.
Mapleview and Burlington mall are great destinations for weekend shoppers looking to add a new t-shirt, that they don’t really need, to their closet.
If you’re looking to pack on a few pounds, you can also head downtown to many of the city’s dessert shops and restaurants.
With regards to real estate – Housing prices in the city have also risen over past years as prices aren’t only skyrocketing in Toronto. Are houses cheaper in Burlington? Absolutely. Everything is cheaper outside of Vancouver and Toronto.
Condo developments have been spotted over Burlington’s downtown core with unhappy residents, perhaps Karens, voicing their opinions. Again, purchasing a condo 10 years ago would’ve been ideal. Now a 2 bed 2 bath in Burlington could run you around 700k, depending on the area you’re looking in.
My conclusion/ thoughts
If you have been a resident of Toronto since the good old days of affordable real estate, sell. Take the money and run. If you can profit 500k or even 1 mil, retire early in Mexico. Have you seen Puerto Vallarta?
But nah, I get it. Canada is a safe country and you want your kids to live in a prosperous nation. Perhaps you simply love Toronto, Burlington, Stratford (where Justin Bieber is from) and you wouldn’t leave it for the world. Canada is awesome.
Thanks for reading and remember, sharing is caring.