Correction seems like the kindest word…
2008 was at once cruel and kind in the Toronto housing market. Cruel, no doubt, to investors who had placed their faith in the potential appreciation of Toronto real estate and especially to buyers who invested in multi-unit schemes intended to reap large rewards. While real estate prices in the Toronto market have fallen by an average 8% in the last 12 months, this frankly is a pretty modest decline compared to losses experienced in equity and bond markets.
Cruel too was the experience for most homeowners of opening up their recent property assessment notices - many of which seemed to reflect what your home may have sold for on the busiest night of the bidding war era! But there weren’t 9 cars idling outside with anxious buyers, and a $50,000 certified cheque was nowhere to be found. ”If the city thinks my house is worth that much,” a handful of my clients said, “then they can come buy it”. Amen.
Cruel finally to to vendors who have HAD to sell their homes, and sometimes at valuations that were dramatically and uncomfortably lower than what they had imagined as recently as a few months ago.
Yet this correction has been a kind time, as well. The exuberance of the last several years could not, would not and should not have continued indefinitely. The panic felt by buyers to get a house at almost “any cost” wasn’t what the home buying experience should reflect. Buyers forgoing home inspections or accepting sub-standard renovations simply to find shelter isn’t sustainable behaviour. And the gloom reflected by the sense that home ownership would “never be affordable” to first time buyers hasn’t been kind to watch. While home prices have strengthened, I believe that the experience of the last few years in Toronto has damaged the reliability, confidence and logical functioning of the market.
So be kind to yourself, if you are in a home that’s comfortable and fairly easy to afford. If you don’t have to sell it tomorrow, be thankful and at easy knowing that the housing market is still alive, although a bit quieter than days gone by.
And if a new home is on your horizon - a first time loft, larger house for a growing family, or an awesome lot to build your dream home - then realize that the market has done something kind. Finally, after all this time, it has given you the chance to make a careful choice, with consideration and care. Not only might your home be much more affordable, but hopefully you will find exactly your own unique urban home.
Paul Johnston
http://pauljohnston
Unique Urban Homes Toronto
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