Why Haven’t Toronto Home Prices Plummeted? (Toronto Real Estate Market Update)
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- Опубліковано 19 вер 2024
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In this episode we take a look at the current Toronto Real Estate Market specifically the detached home prices and market trends for week ending Sept 4, 2024. We also discuss why home prices seem to not be coming down as fast as some people are expecting, even though signs are pointing in that direction.
This video will focus specifically on Toronto but be sure to SUBSCRIBE for more reports on other areas!
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Santo Sessa & Daniel Sessa
Re/Max Premier
(647)560-7778
santo@teamsessa.ca
*This video, nor any of the other videos on the Team Sessa Real Estate UA-cam channel, does not constitute legal or financial advice. This is strictly intended for educational and entertainment purposes only.
I work in law firm the amount of bankruptcy I'm seeing coming daily its going to be a cold winter and next few years ecpect lot of house prices will be unloaded
Exactly. There was a video pushed today from a insolvency lawyer who basically came clean. His office is flooded. Summer is over. And now it's payback time. The real estate industry did everything humanely possible
Last year pumping the fall market
Then it was royal lepage "all time high" is coming.
Then it was just wait till rates fall.
Now we are in the fall market.
The jig is up. This asset that is 9x your income that nobody wants has gone zero bid. While mortgages reset.
I really feel bad for the idiots who are using hope as a strategy. They have no clue how bad this is going to get. But rest assured. The real estate industry will be "surprised ". And there to "help" you.
😂
Toronto is too expensive to live. Everything. I am not surprised that people are pulling the plugs
Prices are always sticky on the way down, absolutely normal! They will continue to go down for years to come. The Canadian economy has been ruined by housing prices and will bring a long drawn recession until things correct themselves!
Will be a repeat of the 80s and early 90s.
No real gains for over a decade.
You can hold your bladder for a few minutes no problem, a few hours maybe, a few days very painful, few weeks you are done.
There is no more land in core GTA. Prices might stagnate for a few years but such a supply shortage will not crash prices. Condos are another matter and also SFH in areas outside Toronto where there is a lot more free land to build.
This is magical thinking.
@@mohammadakhtar6941
True about the downtown core, and the same in Vancouver.
But they will suffer the same fate as San Francisco.
Street level businesses there are half gone, just for lease signs everywhere, was shocked when I went there a few months ago. The local people said it was because of the price of real estate.
Hope you like your Uber eats cold or not at all.
Those expecting home prices to drop should reconsider! Do you think groceries, gas, and other essentials will fall by 50%? Prices are relative-if homes drop, so must everything else, or people will be left with more money at hand which will cause inflation to surge (Recent Demo happened Post Covid).
For house prices to fall, land, construction, and materials would also need to drop; otherwise, builders won't build, leading to shortages and increased demand, pushing prices back up. In Hamilton, builders already face $800K+ costs for land acquisition, materials and constructing a home-how can they sell for less than $1 million? Buyers can keep on the sides, but Canada is a safe haven for investors and they will return soon, and prices will keep rising-that's how capitalism works
@@tariq.ghalib it is how capitalism works.
But it's not how a recession works.
I was a teenager during the 70s inflation.
Got a pair of supertack skates when I was 12 for $100, got another pair when I was 14 for $300, same skates but 3x the price.
My father's friend built his dream house in 1978 for 175k, my dad bought it from him in 1983 for 95k.
This recession will be similar.
100%..inflation baby...prices will continue to go up...let them cut a few more tines..spring market will come back with vengeance
Who can wait this out longer. A buyer or seller.
I can assure you. A buyer.
Especially when they see prices dropping every single week. Haha
In a normal market and society the buyer always has power, simple they got the doe $$$
@@archimedes2261 thats interesting, since we've been in a sellers market for 9/10 previous years.
seller. buyer will face increasing rent and rental shortage . seller losing nothing
@@MrDedushkoMoroz
Rents are dropping as I type.
Too many empty units that can't sell hitting the rental market.
No new flood of immigrants this year to prop it up.
This is only the very beginning of the melt down. It will happen, just slower than expected.
Give it some time.... now over 3,000 'severely arrears' GTA properties now facing Court action.... stay tuned !
Real estate is a depreciating asset
That is the definition for real estate, but over the last decade or so, people have lost sight of this
Be patient they will crash
No they won't
@@jayak3768 yes they will, especially the shoe box investment condos at $1600 sq foot. No one wants them and airbnbs are banned in most of the city now.
No one wants to catch a falling knife.
Let's revisit this in a couple years.
Canadian house prices of the last 5 years never matched the obvious economic reality in Canada. We have million dollar priced average homes for a median salary of $58k a year and that's only for the ones earning that much, majority earn less, house prices have a mind completely devoided of the Country's economic and GDP reality.
material cost (+tax)
building permits (+Tax)
labor cost (+tax, cpp, insurance. etc)
development fees
land transfer tax + other taxes
delivery, gas tax
if you calculate everything what takes to build the house you will get current house price + minimal margin
It's a matter of time
Hi Santo love watching your video very informative even thou i don't own a property of my own😊
Thanks Sharon.
I don't think people realize how strong the hands are. There are folks out there in Canada right now in all of the major markets who have massive amounts of dry powder. Massive. They will not sell easily. Absolutely not.
They don't "have to" adjust their price, Sessa. There's no law that says you have to lower prices.
Looks like less listed vs same time last year? And same sales taking place. Bottoms in for freehold. Condo market diff story
construction cost for a new homes are high , why ppl think prices will plummet ?? Nobody will sell a house for less than construction cost, nobody wants to take losses
💯
What's needed for prices to crash is fear
Fear hasn't yet hit the market.. It will come soon
Inventory can't keep increasing
Money laundering
We’re also approaching near the bottom of the down cycle and if your priority is realizing a pre-downturn price it will pay to wait. Buyers, your window to purchase before the up shift is likely 12 to 18 months at best estimates.
You are correct.
In a typical recession real estate does continue downward for 12 to 24 months after the first rate cut.
This one has the potential to be a long long recession though.
Could continue down for 4 or 5 years.
I would say the window is 3-4 months. By early spring 2025 it will be too late. The options are get something now at a good low price or wait for next year, pay $100k more but save 0.50% on the mortgage rate.
@@user-bp8ie1cs4p
Your underestimating how clearly screwed the economy is.
What do you see on the horizon that is going to create employment that quickly?
The Canadian economy is too screwed for the next 10 years and after no one will ever overpay for overvalued homes.
There are many buyers waiting for lower and lower prices. Eventually they will start to buy as they will see prices are staying firm. Don’t rely on economic numbers to make decisions. Everyone wants to be a home owner, it’s human nature.
If I’m in the market to buy a home, why would the unemployment number affect my decision? If I can afford the home and mortgage then why not buy?
Sellers do not and will not budge until they do. There is still too much hysteria out there, regarding real estate prices, that basically most sources "agree" that prices will go up as interest rates fall .. so why would they not wait it out? They will wait until they cannot wait any longer.
The reality check does not come quickly ... but the traces it leaves behind are not pretty.
Houses will start to move if rates go lower not necessarily go upwards
Zero rates means nothing, if a Canadian is earning low wage compared to an American, yet pays a million for a house while an American pays $200k for a simple old 3 bedroom or even new.
@@archimedes2261 But the US gov has not made it its mission to keep housing prices high no matter what, like the Canadian gov has.
Detached homes are for richer people. Richer people make more money. Less sensitive to 2024.
Sellers better price their house right if they want to at least have a chance to sell. Things are looking pretty scary for the RE market. Buyers you're in for a treat soon!
They brought it on themselves, people earning Canada's 58k a year can never afford $800k median house 🏠 prices 😆 the special kind of stupid already bought at absurd prices, the remaining folks are lucky to keep a part time job right now, they ain't coming for your million dollar 3 bedroom average home any time soon to buy 😆
@@archimedes2261 couldn't agree more. Fun is over, and some sellers are in serious denial.
- mass immigration
- lag in the interest rate effects
These two factors have saved the market so far. But, both are coming to end now.
Once they pull the plug on immigration it will crash.. Everything will.. GDP growth has been too dependent on population influx and real estate.. and government spending..
Hi Santo
I like your truth talks.
Thankyou for honesty
People not lowering the price because there is no need for them to do it. They are not stressed.
Bankruptcy lawyers say something different
Slow train wreck, no Minsky moment in sight yet but TO is Canada in a nutshell, so will take time
Depends on the sellers situation. The people that need to sell will SELL. If we have unemployment increase, higher delinquency rates and wage growth slowdown, hard to see how long folks will "stand their ground". You have to ask yourself, at what point do they break?
Unemployed people typically don't think of buying anything let alone a million dollar 3 bedroom junk 😆
Great job Santo, as always.
houses have absolutely crashed, your just pricing it in the canukistan peso. use any other metric houses have crashed. those who know, know
honestly how many first time home buyers could even afford a home over 600K? yet homes are over 1mil
You are a peasant if you cannot afford a home over $600k and shouldn’t be able to buy a house if you can’t afford $600k
@@pd5482 so with 20% down, 480Mortgage, $2750/month is peasant?
Are power of sales listed on mls.? If not where?
Why, you want to be a vulture to scoop up someone's home ?
Yet... the tide is just starting to go out.. we woll find out in about 6 months who was skinny dipping
So one high sale can set a precedent for other houses but low sale (and other houses not selling) can't say a precedent 😂. Funny how it goes eh? I can take wish for it to rain gold doesn't mean it'll rain gold.
How long can sellers hold out? People aren’t buying anything at such mismatched pricing. Longer they hold the more investors will lose. I’d say wait till end of 2025 coming into 2026
You are delusional. When one home tanks. That is the new price for the neighborhood.
And I promise you. It's coming.
Look up the videos on bankruptcy lawyers.
Agree
@@alaalrashaeideh1154agree!
Spot on
11:00 On weekly basis there is none or few sale in Downtown Toronto.
But do we have the inventory for this part ?
They probably must stay very long on the market
I just bought a house in Vaughan. I don't see what the fuss is all about. Just buy and hold long term.
Good for you, good time to buy. Why wait and pay more next year! Congrats.
Simple rule = if everyone thinks something will / wants something to happen, it won't. Especially if it's simplistic.
It looks like the gap between detached and condos has really narrowed. It used to be $1M. Do you have any numbers on mix? %of condos selling that were 1, 2, 3+ bedrooms year over year?
- also seeing an influx of freeholds that are more investor-type this whole year. Ex. with basement apartments or are "lesser tier" homes by plot (backing onto railtracks or have easements) or quite worn looking.
It isn't even close to the bottom with where economy is heading. :) I know but pain must be suffered otherwise bubble becomes bigger.
Santo - let me get this straight - if a seller is in financial trouble and lets their home go for a low price, that price sets the market on that street? No way. That other agent is completely correct. Good for them for standing their ground.
Because no one lost their job yet
Thanks for interesting seasonality comment and moving away your head 🙏
Only relief buyers can expect is mortgage rates coming down
You made a video....yes. Did you answer any questions...not at all😂
Prices need to correct by 60 to 70 percent to make it affordable and tied to income
2016 17 18 price was at hafe the price that is now .I can't believe that people are ready to pay that much . If they took 20 year to get to that price. And in just 4 5 years they dubbled .something to think about 😮
Taxes are higher, insurance, utilities im confused . Really not making any sense.
Real estate agents are very in debt they have to keep the prices up. They don't care if the seller needs to get out they need the money.
This will be a decade to remember this is a downturn it will be long and dreadful.People would be losing their shirt tail in the years to come too much instability globally
I am afraid prices will not go down. people will be stuck in their homes since no one can afford to buy them. so in a way they are valueless ,
Think about what people have to go through mentally when their home price drops by 100s of thousands of dollars! Reality is Reality, however, it is not easy for anyone to accept a negative situation. Denile goes on for a really long time.
Distressed sales - while purchasers may have lucked out, these sales are not considered when determining market value.
As long as people prefer to stay in GTA, they need a place to stay whether owning or renting. Someone must own before renter can rent. Rental rate is raising due to less inventory in the market. As most investors trying to sell. rental increase will make investment attractive at some point. As long people don’t leave , that is demand and price will not plummet much. We are heading into recession, it’s hard to find jobs in other provinces, come to GTA chance get job is higher compare to other provinces
People can't stay if they don't earn enough to pay $3000 a month rent or mortgage for an average 2-3 bedroom house or condo, most don't earn that much in net on a full time job, the short answer they will leave. And prices must tumble after that it's the only logic here the overpriced housing market is doomed.
GTA has unemployment rate of 8%. Average for Canada is 6.4%. it's more likely people will leave Toronto to get work.
@@Jo-mf2vu cause it’s happening already, more people moved here to find work.
@@archimedes2261 15 mattresses in a house is common now a day. 3000 to fit 5 mattresses that is only 600 each. Yet people still prefer to stay special hard to find job in other provinces. When all have are more established in the future, they demand five individual units. That is 5 times increase in demand
@@archimedes2261 if rental is 3000 and 5 mattresses that is only 600 each. Still have room to hike rent. Yet, people still prefer to stay in GTA. If they become more establish, they will demand for 5 separate units. 5 times increase in demand
Houses in GTA that cost $1.6 million now will go down to $600,000.00 next year. ( If horses could fly beggars will ride)
That’s an aggressive price drop David. I personally don’t see a scenario where that is possible.
@@teamsessa Apparently you did not recognize the sarcasm in my statement, hence my quote that if horses could fly……. You see reading through peoples comments on the video, it seems to me that there is some glee being expressed by some people if properly prices drop like a stone. I am an investor myself and have properties that I have bought 6 to 10 yrs ago in the GTA area, and come hell or high water I will not “give away” my properties when it is time for me to sell. As far as I know Canada is not a socialist country, as much as Trudeau wants it to be, if investors take the risk to buy properties this is not a crime, and if they sell to make a profit or hold on to their properties if the price is not right, it is their prerogative. We have a lot of people who are pointing their fingers at”greedy landlords” as the cause of increase in property prices forgetting that it was the BOC that increased mortgage rates. It is this same people who will rent your property and refuse to pay rent. So for all those waiting for prices to drop to the very bottom, don’t hold your breathe.
It does not mean the crash is improbable
Sellers are firm on their prices because they know prices will raise next year or the year after. Buyers who are waiting for price drops will regret it soon. They are losing one of their best opportunities to buy with reasonable prices.
Reasonable??... The economics does not support the notion of house prices increasing next year or the year after.. living cost is too high, it hasn't come down yet. People won't be able to afford a high mortgage plus expensive prices for basic needs..
@@humbledreamer88 I understand it is not affordable for many people. But consider that interest rates are on the decrease, and next year at this time, you will be able to negotiate much better deals for your mortgage. Also, the home prices are a result of supply and demand. We all know that developable land is limited and single family homes are not going to keep up with the population growth rate. Going forward, single family home will be less and less affordable, and most people will have no option but condos, but there will always be enough demand for houses to push their high prices even higher and higher.
@@Bykv78
Also many new construction is not happening now. Builders can’t sell and hence no financing. Condo that sell now should be ready by 2027, but since these projects are cancelled, expect high demand in 2027. So what do you think the prices will be in 2027? Check the videos from condowong.
@@user-bp8ie1cs4pCondowong is sleazier than a used car salesman. There still will be plenty of completions in 2027. In 2028 things start to dry up. Still a lot of pain in the condo space for the next few years.
Some sellers can wait it out, but there are many that have been trying to sell for the last two years and are getting desperate. It's the marginal seller and buyer that decides the market price, and those prices will continue downward for the next year or more. No use buying on the way down into a recession.
You people live in la la land...prices will continue to go up...more rate cuts are on the way....SPRING MARKET WILL COME BACK WITH VENGANCE!
Prices are not coming down your delusional if you think prices are coming down in Ontario....😂😂😂😂😂😂
Click bait 😂. Plummeting on the way.
well you have to get everyone that has money to lose money.
Prices, particularly over the past five-seven years, have been bid up by the investor class. Current prices are not supportable absent the investor class. Investors have left the market... en masse, particularly in the condo space. They can't make the 10% annual returns they are used to and expecting. It is only a matter of time for those assets to be re-priced for the owner-occupier class that must be able to qualify for a mortgage based on income !!! You can't have a real-estate market sustainably priced at 11 X income without investors present , bidding up the prices. It is only a matter of time. I expect long term stagnation on prices for the most attractive and valuable properties (single detached in good condition in good neighbourhoods) and long term decline for properties that have over the past five-seven years, been supported by investors... who have now left the market.
Yet
First
Second.