Talk to real-estate agents, and most express disbelief at how the Toronto market keeps defying the doomsayers month after month.
What’s fuelling it? Those bargain-basement mortgage rates keep affordability in line, even as prices have risen, says Toronto Real Estate Board analyst Jason Mercer.
Factor in the number of potential buyers per house, and you’ve got a recipe for price hikes. Mercer says recent sales totals projected annually could make 2012 the second-best year on record (after 2007), even as listings have lagged.
Related: How to win a real estate bidding war
There is also a rush of foreign money looking for security, as trouble spots multiply overseas. Re/Max Realtron broker Bill Thom says his immigration consultant friends are reporting new interest from the well-heeled in Greece, Italy and Spain, and real-estate board president Richard Silver recently welcomed a visiting group of realtors from India.
But not all neighbourhoods are on the boil. Magnets include (comparatively) affordable prices, good transportation, top-notch public schools and a major dollop of cool.
High-priced houses move slowly. “The real brilliance is in what we would call the lower end, which is around the average of $500,000 now,” says Silver.
Here are five Hogtown hotspots:
East Willowdale/Bayview Village
Who can forget the headline-making story of 300 Dudley Ave. last month. A student, whose family lives in China, bought the bungalow for about $1.18 million, a shocking $421,800 over asking.
Thom knows the area: between Sheppard and Finch, running east from Yonge to the Don River.
He offers another market measure: A bungalow at 59 Forest Grove Dr., on an extra large lot, sold in 2010 for $1.65 million. Just 22 months later, it resold for $2.53 million. No changes: just a hefty $900,000 gain.
Affluent immigrant buyers, mainly from China, Korea and Iran, are drawn to the area. It started with the excellent public schools, such as Earl Haig Secondary, says Thom, but there are other attributes.
The location is close to the subway and major highways, and the original housing stock is uniform: post-war bungalows on large lots, which lend themselves to redevelopment. Properties with “knockdowns” go for about $1.3 million, but with a brand new house, you’re looking at $2.4 to $2.5 million, Thom says.
“I don’t think this is the end of it, because there’s still a lot of money coming in. This area will continue to attract more investment.”
Related: A home closing checklistMimico-New Toronto
Realtor Lynn Tribbling is no doubt biased. She lives in a condo in south Etobicoke’s Humber Bay Shores, with one of the city’s hottest housing markets to the west.
She loves the waterfront, a prime reason for the area’s renaissance. Another draw: it can satisfy a range of buyers, from the cluster of condo towers at the eastern edge to the family-friendly streets of Mimico and New Toronto, with modest older homes, as well as newer townhouse infills on industrial land.
Her survey of 20 recent single-family sales shows the hottest price points are in the $400,000 to $500,000 range on 30-foot lots, where 95 per cent sold over the asking price within days.
“When you get into Mimico,” explains Sutton Group realtor Bill Mohan, “a couple years back we were seeing $359,000, but now $499,000. And they’re still selling, for $510,000, $515,000, $520,000. It’s just affordability. Because everything else has gotten expensive, it’s pushed people into these areas.”
That starts an evolution: “If enough people move into an area, then it’s all of a sudden cool. They’re bringing their friends over there. I’ve always found that has been the trend, the last 10-15 years.”
What’s the future for Mimico, in the doldrums until recently as a low-income industrial area? Planned new condominium projects will boost the population by many thousands, continuing to transform the area’s commercial amenities, even as it poses traffic and transit challenges.
The Junction
One of the strongest year-over-year price hikes took place in the Junction and adjacent neighbourhoods. The real estate board’s “benchmark” prices, which smooth volatility, showed a 16.3-per-cent gain for single-family detached homes ($717,900 in March) and 21.5 per cent for semis ($593,700).
Says Sutton Group’s Bill Mohan: “I was just up there the other day, driving, and I couldn’t believe how many people were out there walking and shopping. That’s what’s changed in the last couple of years. It’s really got a good neighbourhood feel.”
Dundas St., east of Keele, is a striking commercial streetscape, but it languished for years in the lee of polluting industries and the pungent stock yards to the north. Plus, the area was dry until a 1997 referendum.
Now, it has some of the coolest architectural antique and furniture stores in the city, busy coffee shops (including a recently opened Starbucks) and restaurants.
The neighbourhood’s appeal has lit a fire under the railway delineated Junction Triangle to the east, as buyers seek more-affordable options on streets such as Perth and Symington Aves. Not much is available, but some detached houses have recently gone over list in the $500,000s. A Perth Ave. semi is currently listed for $469,000.
Dufferin Grove
Real-estate board president Richard Silver picks this area, bounded on the north by Bloor, running west from Dovercourt Rd., past Lansdowne Ave. to the tracks and south to College and Dundas Sts.
The name, of course, comes from Dufferin Grove Park, where volunteers have built, and are fighting hard to retain, a remarkable array of programs.
It gives the area a strong centre, says Silver, and storefronts along College and Dundas are reinventing themselves, as the population changes.
He says houses in the area, both north and south of College, “are flying off the shelves.”
He just sold a unique 800-square-foot, two-bedroom coach house sitting right at the edge of the park for more than its $549,000 list price. Substantial three-storey semis in the area are selling for $700,000 to $850,000, well above list prices in the high $600,000s.
“Personally, I think the market is driven by the fact that Roncesvalles (super hot, as well) to the west and Little Italy to the east have increased in pricing, making Dufferin Grove seem like the affordable option,” says Silver.
Related: Why it's still a good time to buy a homeWoodbine Corridor
Here’s another neighbourhood that Silver highlights for rising interest and prices. It’s bounded by Coxwell Ave. and Woodbine, and runs from north of the Danforth to Queen St. E.
Says Silver: “Proximity to the Beach and the Danforth subway are big drivers.”
The housing stock includes more detached homes, (the March “benchmark” price was up almost 11 per cent from a year earlier), as well as the ubiquitous semis.
While the board’s average period on the market is 25 days, homes in this area are snapped up in only 13, Silver says, selling for an average of 102 to 105 per cent of the asking price.
“Years ago, young families chose to move to the 905 when they could no longer afford larger detached houses in the 416,” he points out. “Now, and in the future, because of transportation issues, it will be harder than ever to live in the 905, yet work in the 416.”
You can find some of the classic east-end, two-storey semis in the area priced from a low of $375,000 to $450,000, while a few detached are on the market in the $500,000 range. An older-style, two-storey semi on Moberly, south of the Danforth and west of Woodbine, just sold for 120 per cent of list at $601,000.
Looking outside the city?
As Toronto prices rise, so do those in the suburbs, driven by affordability, lack of inventory, and value for money compared to the city.
WEST: Asked to identify a Mississauga hot spot, Sutton Group agent Cynthia Shaw points to Lorne Park, south of the QEW. A more-affluent family neighbourhood, it includes older homes from the 1950s-‘70s, some of which are being demolished and replaced. She estimates prices are up 25 per cent year over year, but says you’ll still get twice the house and a bigger lot in Lorne Park compared to Toronto’s west end.
EAST: Re/Max broker Mary Roy says the hot spot in Whitby and Ajax is actually a price point: $350,000 to $400,000 for a detached 1,500- to 1,600-sq.-ft. home. Even in this high-demand, first-time-buyer category, prices are only $10,000 to $20,000 ahead of last year, she says.
NORTH: Look for the best schools, and that’s where you find the action. Pierre Elliott Trudeau High School ranks high, and Markham’s Berczy Village feels the impact. Just about every sale in the area draws multiple offers, says Sutton Group agent Martin MacFarlane. He estimates increases over the past year at about 10 per cent. Detached homes range from $550,000 to $1.1 million.
http://www.thestar.com/business/article/1160061--five-housing-hot-spots-in-toronto