Inventory is low, prices are high and on the rise, and it’s taking house-hunters longer and longer to find—and then win the bid on—homes that aren’t even necessarily their first choice.
You probably think I’m describing the beastly Toronto real estate market, but you’d be wrong. The challenges that have been facing home buyers across the GTA have spread outward into neighbouring regions like cold butter in a hot skillet.
In fact, the lack of options and too-high price tags on what few listings are available in the GTA is pushing buyers to look beyond even the more traditional suburban areas like Etobicoke, Mississauga and Durham, and as a result, real estate markets in the City of Hamilton and the Niagara Region are quickly heating up.
Why buyers are movin’ on out
It comes down to affordability for the young families that are making the move out of the GTA, says Nile Livesey, real estate sales representative with L. Bodner Real Estate Inc., who describes it as a chain reaction.
“Investors are coming into Toronto, which is pushing people into the surrounding areas,” he explains, “but then the people who might normally buy in those areas are being pushed out too. If you skip through Oakville and Burlington, because those have always been more expensive markets, you come to Hamilton, Grimsby, Beamsville, Lincoln and St. Catharines, and we’re starting to see it.”
The push is going out, and there’s a larger number of people moving further away from Toronto, and it’s creating an inventory problem across the board.
And of course, as we’ve seen in the GTA, when inventory’s low, prices creep upward.
Overpriced and overbid
A recent report from Canada Mortgage and Housing Corp. (CMHC) said overvaluation in Hamilton is similar to that of Toronto’s property market, and bidding wars have begun in the Niagara region almost overnight.
“Last year it was unheard of in this region. In Toronto you’re absolutely going to have eight, nine or more offers with every detached house unless you’ve priced it astronomically high. But agents in Niagara have only just started to experience multiple offers, and they don’t know how to handle them.”
There used to be a big difference between the Toronto real estate market and the Niagara real estate market, he says, but they’re becoming more and more similar, and it’s a situation that’s being mirrored in cities and towns across the province of Ontario.
Take what you can get
For many of us, Niagara conjures up images of sprawling land, elegant estates and luxury, wine-soaked living. While that IS a common sight in the region—especially in and around Niagara-on-the-Lake—it isn’t the type of housing and lifestyle for which people are currently on the hunt.
“Four years ago if people moved out to Niagara they wanted that big piece of property and a bigger house, and they’d change their lifestyle to meet the area. Nowadays, people almost aren’t even bothered with that,” says Livesey. “In many cases, it’s a matter of ‘I’ll take what I can get, and I’ll figure out how to get to work in Toronto,’ or they’ll find something out here in terms of work.”
In case you’re wondering, the drive from Niagara to Toronto is approximately one hour and fifteen minutes in low traffic, around one hour and forty-five minutes in busy traffic, and can be well over two hours when the conditions get rough.
Whether or not it’s a trek you’d be willing to make, many ARE willing because it’s the only way to get the home of their dreams (or at least one they’re willing to settle for) at a price that won’t blow their budget to smithereens.